Kathianne
12-03-2012, 05:03 AM
I have to agree with Norquist, the Conservatives should argue that the discussions be broadcast on C-SPAN.
http://www.realclearpolitics.com/articles/2012/12/03/whos_not_bargaining_in_good_faith_116309.html
Who's Not Bargaining in Good Faith?By Robert Samuelson (http://www.realclearpolitics.com/authors/robert_samuelson/) - December 3, 2012
WASHINGTON -- Put Social Security on the table -- clearly and irrevocably. Protecting retiree benefits is the left's political equivalent of the right's "no new taxes" pledge. Congressional Republicans are abandoning their untenable position. Now it is time for President Obama and congressional Democrats to do the same. As long as they don't, they aren't bargaining in good faith, or in the national interest.
Supporting retirees is now the federal government's main activity. There's a huge redistribution from young to old -- a redistribution that will be made worse if retiree programs are largely excluded from deficit reduction, as many liberal groups urge. Either taxes will rise steeply or other federal programs (defense, food stamps, environmental protection) will be cut sharply. The young will pay more and get less. Or, given these unpalatable choices, true deficit reduction won't happen.
...
As baby boomers retire and health costs rise, this spending will mount. In 2010, there were 40 million Americans 65 and older. By 2020, that number is projected to be 55 million; by 2030, 72 million.
All these trends are old news; I have repeatedly written about them. If we had begun cutting benefits years ago, changes could have occurred slowly. People would have received ample notice. Now we lack the luxury of time. Benefit cuts will be unfair to retirees; but avoiding cuts will be unfair to the young. That we have arrived at this juncture indicts our democratic system and many Democratic politicians, who have obstructed constructive change in retiree programs. Obama continues this short-sighted tradition.
What could justify it?
One argument is that most elderly are poor; benefit cuts will further impoverish them. Not so. The Administration on Aging reports that in 2010, 25.9 percent of households headed by someone 65 or older had incomes exceeding $75,000; 19.4 percent had incomes from $50,000 to $74,999; and 18.8 percent had incomes from $35,000 to $49,999.
Another argument is that recipients "earned" benefits through their payroll taxes, which (many believe) were saved. But they weren't saved; they paid the benefits of earlier retirees. Even had they been saved and earned interest, they typically wouldn't cover lifetime Social Security and Medicare benefits, estimate the Urban Institute's Eugene Steuerle and Caleb Quakenbush. A couple with average wages retiring in 2010 would receive $966,000 in benefits against taxes of $722,000.
...
No genuine debate about government priorities can exclude its biggest program and those loosely associated with it, Medicare and Medicaid. The exemption isn't progressive, because protecting retiree benefits will intensify pressures on the social safety net. The trick is to cut retiree benefits while minimizing the impact on the elderly poor. There are ways to do this: changing the benefit inflation-adjustment formula, fully taxing Social Security payments (affecting mostly the affluent elderly), gradually raising eligibility ages.
Deficit reduction should include higher taxes on the richest Americans. But there are practical limits. Already, Obama's proposals would, in combination with state taxes, raise some top marginal tax rates to about 50 percent. As taxes rise, so do risks of adverse economic effects and more tax avoidance. Spending must be addressed. Government has other responsibilities besides sheltering the elderly.
By evading this, Obama flirts with failure. If Democrats won't relinquish their sacred cows, Republicans will cling to theirs. We might go over the "fiscal cliff." Or any budget package may be tiny. We need to acknowledge new social realities affecting the elderly (longer life expectancy, better health, greater affluence). Benefit cuts can be introduced over a few years to minimize the threat to the recovery. But we need to start. Now.
http://www.realclearpolitics.com/articles/2012/12/03/whos_not_bargaining_in_good_faith_116309.html
Who's Not Bargaining in Good Faith?By Robert Samuelson (http://www.realclearpolitics.com/authors/robert_samuelson/) - December 3, 2012
WASHINGTON -- Put Social Security on the table -- clearly and irrevocably. Protecting retiree benefits is the left's political equivalent of the right's "no new taxes" pledge. Congressional Republicans are abandoning their untenable position. Now it is time for President Obama and congressional Democrats to do the same. As long as they don't, they aren't bargaining in good faith, or in the national interest.
Supporting retirees is now the federal government's main activity. There's a huge redistribution from young to old -- a redistribution that will be made worse if retiree programs are largely excluded from deficit reduction, as many liberal groups urge. Either taxes will rise steeply or other federal programs (defense, food stamps, environmental protection) will be cut sharply. The young will pay more and get less. Or, given these unpalatable choices, true deficit reduction won't happen.
...
As baby boomers retire and health costs rise, this spending will mount. In 2010, there were 40 million Americans 65 and older. By 2020, that number is projected to be 55 million; by 2030, 72 million.
All these trends are old news; I have repeatedly written about them. If we had begun cutting benefits years ago, changes could have occurred slowly. People would have received ample notice. Now we lack the luxury of time. Benefit cuts will be unfair to retirees; but avoiding cuts will be unfair to the young. That we have arrived at this juncture indicts our democratic system and many Democratic politicians, who have obstructed constructive change in retiree programs. Obama continues this short-sighted tradition.
What could justify it?
One argument is that most elderly are poor; benefit cuts will further impoverish them. Not so. The Administration on Aging reports that in 2010, 25.9 percent of households headed by someone 65 or older had incomes exceeding $75,000; 19.4 percent had incomes from $50,000 to $74,999; and 18.8 percent had incomes from $35,000 to $49,999.
Another argument is that recipients "earned" benefits through their payroll taxes, which (many believe) were saved. But they weren't saved; they paid the benefits of earlier retirees. Even had they been saved and earned interest, they typically wouldn't cover lifetime Social Security and Medicare benefits, estimate the Urban Institute's Eugene Steuerle and Caleb Quakenbush. A couple with average wages retiring in 2010 would receive $966,000 in benefits against taxes of $722,000.
...
No genuine debate about government priorities can exclude its biggest program and those loosely associated with it, Medicare and Medicaid. The exemption isn't progressive, because protecting retiree benefits will intensify pressures on the social safety net. The trick is to cut retiree benefits while minimizing the impact on the elderly poor. There are ways to do this: changing the benefit inflation-adjustment formula, fully taxing Social Security payments (affecting mostly the affluent elderly), gradually raising eligibility ages.
Deficit reduction should include higher taxes on the richest Americans. But there are practical limits. Already, Obama's proposals would, in combination with state taxes, raise some top marginal tax rates to about 50 percent. As taxes rise, so do risks of adverse economic effects and more tax avoidance. Spending must be addressed. Government has other responsibilities besides sheltering the elderly.
By evading this, Obama flirts with failure. If Democrats won't relinquish their sacred cows, Republicans will cling to theirs. We might go over the "fiscal cliff." Or any budget package may be tiny. We need to acknowledge new social realities affecting the elderly (longer life expectancy, better health, greater affluence). Benefit cuts can be introduced over a few years to minimize the threat to the recovery. But we need to start. Now.