Naked Capitalism: Peter Orszag Is Selling Catfood Futures

[amborin]

Peter Orszag of Bank Welfare Queen Citigroup is Selling Catfood Futures Hard

The Obama victory was less than 24 hours old when the Rubinite faction of the Democratic party was out full bore selling “reforming” Social Security as the adult solution to the coming budget impasse, giving it higher priority than any other measure on the table while simultaneously admitting that this is not even a pressing (let alone real) problem:

"....So the most promising approach may be to compromise on Social Security -- even though it is not a significant driver of our long-term deficits.

This would have several benefits for the White House. For one, Democrats should leap at the chance to restore solvency to the program while keeping private accounts off the table. (That may not always be a possibility.) Raising the $110,000 cap above which the payroll tax no longer applies is perhaps the single most popular way to raise revenue. And, by making the annual Social Security benefit more progressive, the administration could address the growing gap in life expectancy by income and education in the U.S. ...."

http://www.bloomberg.com/news/2012-11-07/white-house-should-be-ready-for-a-debt-limit-deal.html

".....Even if you were to accept the wrongheaded premise that deficit cuts were necessary, the Orszag piece is disingenuous. Orszag claims the Administration has three options, no more, no less. That’s patently ridiculous, particularly since Orszag fails to mention spending cuts, in particular, defense-related. Yet polls show overwhelmingly that Americans put that on the top of their list of budget fixes. No, instead Orszag says Obama could go into the new year and let tax cuts expire or could make concessions on raising taxes on the rich. Orszag doesn’t even bother giving very convincing reasons for dismissing these possibilities. In fact, he undermines his case against going into January with his aside early on “No one was really punished for the debt limit debacle of 2011.” Correct. It made Mr. Market very unhappy for a while, but Mr. Market got over it, and the partisans blamed the other side.

The rest of his article argues for his option which has some bells and whistles, but boils down to: “”We can’t agree on anything else, so let’s go after Social Security and sort out the rest later.” And he admits this isn’t a solution to any real problem:

So the most promising approach may be to compromise on Social Security — even though it is not a significant driver of our long-term deficits....."

snip

.....this would spit in the face of the people who just put Obama in office:



Read more at http://www.nakedcapitalism.com/2012/11/peter-orszag-of-bank-welfare-queen-citigroup-is-selling-catfood-futures-hard.html#WZOdghZ3h2KR1DGs.99