SALON

Thursday, Nov 29, 2012 6:00 PM UTC

Liberals double down: No entitlement cuts

As reports of a "grand bargain" emerge, Rep. Keith Ellison and the Progressive Caucus refuse to budge

By

Topics: Entitlement reform, progressive movement, Progressives, Liberals, Fiscal cliff, Keith Ellison, Taxes, Barack Obama, "grand bargain",

Liberals double down: No entitlement cuts (Credit: AP/J. Scott Applewhite)

In a story already making waves across Washington, Politico’s Jim VandeHei and Mike Allen reported this morning that a bipartisan “grand bargain” is emerging from talks between the White House and Republicans. The contours of the deal are this: About $1.2 trillion in new tax revenue, most likely from an rate increase on income over $250,000, along with at least $400 billion over 10 years in entitlement cuts “and perhaps a lot more,” mostly from Medicare.

Liberals have drawn a hard line against entitlement cuts and $400 billion is a lot of money, so some progressives are not pleased with the idea.

Democratic Rep. Keith Ellison, the chairman of the 77-member Progressive Caucus, told Salon that his members would not support entitlement cuts. “Any agreement to meet our end-of-the-year deadlines will need a large portion of the House Democratic Caucus to pass. Progressives will not support any deal that cuts benefits for families and seniors who rely on Medicare, Medicaid and Social Security to put food on the table or cover their health costs,” he said.

Outside groups took an even tougher line.

“If this report in Politico is correct, then some ‘senior Democrats’ are sorely misguided about where their base stands. So let me be crystal clear. Any benefit cuts in Medicare, Medicaid, or Social Security, including raising the retirement or eligibility age, are absolutely unacceptable,” Ilya Sheyman, the campaign director at MoveOn.org told Salon. “More than 80 percent of MoveOn’s 7 million members say they want us to fight a deal that cuts those benefits, even if it also ends all of the Bush tax cuts for the top 2 percent. And that’s a mainstream position everywhere except in the lobbyist-cash-infused D.C. cocktail circuit,” Sheyman continued.

There will be consequences, he warned, for Democrats who support a deal that cuts entitlements. “Bottom line: Any Democrat who votes to cut Medicare, Medicaid or Social Security benefits does so at his or her own peril, and shouldn’t be in the least bit surprised to be held accountable by MoveOn members in the next primary election.”

However, there’s an important caveat that’s missing from the deal described by Politico. While Ellison and progressives have said they oppose benefit cuts, they’re open to other means of cutting costs in entitlement programs. “There are better options that protect seniors, children and disabled Americans,” Ellison said, citing the elimination of the income cap on Social Security taxes or letting Medicare negotiate drug prices with pharmaceutical companies, something Illinois Democratic Sen. Dick Durbin also floated yesterday.

The details of the cuts in the Politico article were vague, and it’s unclear if they represents real cuts to benefits or not. “That’s a crucial distinction,” said Adam Green, the co-founder of the Progressive Change Campaign Committee. “What’s worried some about the Politico article is that it kind of tossed in reforms or efficiencies along with talk about raising the Medicare retirement age or adjusting the cost of living adjustment — those two things would essentially start a nuclear war on the left,” Green said. “Those are the two big things. Those are benefit cuts. Those actively hurt seniors.”

But Green said he was encouraged by Durbin’s speech yesterday, and he doesn’t think raising the retirement age is a real possibility. The cost of living adjustment is another matter.

That is wonky, but important and represents a shift of billions of dollars, so stick with us. Basically it comes down to how you calculate the cost of living adjustment (COLA), which is meant to ensure benefits keep pace with inflation. Inflation is measured by looking at the change in the price of a basket of common consumer goods, which creates a measure called the Consumer Price Index (CPI).

There are lots of slightly different variations of the CPI, and liberals fear the final deal will shift from the current measure — called the CPI-W — to a different measure called the chained CPI. Many economists agree the CPI-W overstates inflation, so some people want to change that formula, which would save Social Security money. The chained CPI has emerged as the most likely replacement. It assumes that beneficiaries will change the goods they purchase as prices change (e.g. if chicken prices go up, they’ll buy more beef), but liberals and some economists say that this change isn’t fair to Social Security beneficiaries. They warn that it represents a devastating cut to monthly checks and that it’s not practical to assume that seniors will adjust to cuts by constantly altering their spending habits in response to subtle price variations.

Alex Lawson, executive director of Social Security Works, an advocacy group that works to protect social safety programs, told Salon the chained CPI is “unacceptable.”

“The chained CPI would cut significantly the benefits of all current and future Social Security beneficiaries, including retired and disabled veterans, even after politicians promised repeatedly that any changes to Social Security would not affect current beneficiaries,” the group warns in a fact sheet. Veteran benefits are calculated used the Social Security Administration’s COLA measure.

That said, it’s entirely possible that a grand bargain remains out of reach, but that Democrats were happy to have Politico run a story showing their willingness to make serious entitlement cuts. When the deal falls apart, they can boast that they made a good faith effort to work with Republicans, despite the protestations of their base.

Indeed, House Speaker John Boehner just told reporters that “no substantive progress” had been made in fiscal cliff talks, despite the story.

In this, perhaps conspiratorial scenario, the $400 billion trial balloon would be designed precisely to elicit angry liberal responses such as those above, so as to make Democrats seem at once more reasonable and less able to make a GOP-favored deal. It should be stated that there is zero evidence supporting this notion and there’s plenty of evidence to suggest that Obama really does want to cut entitlements, but planting the story would be classic “triangulation” — and Obama seems to understand how to play this game a lot better than he did during last year’s budget talks.

Alex Seitz-Wald

Alex Seitz-Wald is Salon's political reporter. Email him at aseitz-wald@salon.com, and follow him on Twitter @aseitzwald. More Alex Seitz-Wald.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 75 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

vote
Journalists file suit against Manning's trial secrecy: Plaintiffs including Glenn Greenwald and Julian Assange demand press, public access to trial and documents
149 points150 points | comment
vote
Kaitlyn Hunt refuses plea offer, will go to court over high school relationship - The 18-year-old rejected a deal that would have labeled her a sex offender and placed her under house arrest
136 points137 points | 93 comments
vote
Report: Nearly a quarter of Americans struggle to afford food
136 points137 points | 12 comments
vote
Kaitlyn Hunt refuses plea offer, will go to court over high school relationship - The 18-year-old rejected a deal that would have labeled her a sex offender and placed her under house arrest
123 points124 points | 37 comments
vote
Ted Cruz against the world - How the Junior Senator is igniting the GOP civil war
79 points80 points | 19 comments

From Around the Web

Presented by Scribol
listener_new_rect The Listener: Chekhov's story mirrors Russia's own

Recommendations