The Fiscal Cliff Deal Could Destroy Medicare

[xchrom]

http://www.businessinsider.com/fiscal-cliff-and-medicare-2013-1



***SNIP

Yet if Democrats couldn't get more revenue now, under the best circumstances possible, they'll never get it in the future with the pressure off. Hence, the welfare state is doomed.

Here's Mr Douthat:
[T]hese negotiations amounted to a test of liberalism’s ability to raise revenue, and it isn’t clear that this outcome constitutes a passing grade: If a newly re-elected Democratic president can’t muster the political will and capital required to do something as straightforward and relatively popular as raising taxes on the tiny fraction Americans making over $250,000when those same taxes are scheduled to go up already, then how can Democrats ever expect to push taxes upward to levels that would make our existing public programs sustainable for the long run?

Mr Kwak thinks the failure to get more revenue "sealed the fate of Medicare—as well as Medicaid, food stamps, and perhaps even Social Security." Without more revenue, we're guaranteed an eventual debt crisis, and at that point government will slash safety-net programs:

For decades, conservatives have been trying to "starve the beast"—choke off the federal government's revenue stream so that rising deficits would force Congress to cut spending. They just got a big help.


Read more: http://www.businessinsider.com/fiscal-cliff-and-medicare-2013-1#ixzz2HCjscAkV

[kentuck]

1. Hard to argue with that argument.

I have no idea where the revenue is going to come from to pay for the programs we now have? We have no guts.

[djean111]

2. +1

[kentuck]

3. <snip>

The once-temporary Bush tax cuts were made permanent for income below that level. This will not provide enough revenue over the long term to support America's welfare state (Medicare, Social Security, Medicaid) at anything like current levels.

Yet if Democrats couldn't get more revenue now, under the best circumstances possible, they'll never get it in the future with the pressure off. Hence, the welfare state is doomed.

Read more: http://www.businessinsider.com/fiscal-cliff-and-medicare-2013-1#ixzz2HCn9BT2B

[dkf]

20. Geez we only see the light when some guy on the right exposes what we've walked into.

DU doesn't even understand the big fail yet. Sad.

Howard Dean was the only Democrat pointing this out. He is still the only truth teller around.

[newfie11]

4. SS has nothing to do with the fiscal cliff deal

It is funded by our paychecks AND Reagun doubled the amount drawn out to insure money would cover the baby boomers.

Maybe if we outlawed bribes (contributions from corporations) we would actually see a congress that considers the welfare of it people.

What the hell is wrong with this country, look at what we have become. It is scary.

[kentuck]

5. It doesn't matter if...

...the politicians are convinced we have a huge spending problem, they are going to cut programs that spend a lot of money, such as Medicare. It doesn't matter if we have Military Industrial Complex that is destroying our nation.

[newfie11]

17. So if we all head to the street for protest we can look forward to the military complex and NDAA

Indefinite prison with no trial.


This is like a horror movie

[Bluenorthwest]

10. What did Iraq have to do with 9-11? Nothing, but 'moderates' invaded Iraq anyway, along with

Bushco. Why would this be different, why would they use logic or reason for this issue when they are able to inflict shock and awe on human beings for the sake of an ideology?
Of course, if we had a Fierce Advocate for Social Security in the Oval Office the message would be different and we might have hope.

[newfie11]

16. There doesn't seem to be any logic or reasoning used by politicians, only the highest payoff wins

Obama has already offered up SS so I guess we will all be like Greece and looking in garbage cans

[Enrique]

6. that's only true if people equate democrats with centrists

centrism is only one faction in the Democratic party. It's a fact that we have a centrist president now, but it doesn't always have to be that way. The media will pound it into our heads that only a centrist can get elected, but we need to get over that. Starting in the 2016 primaries.

(By the way, i never heard of Kwak before, but I know Ross Douthat is a conservative, and I'm very confident that he has criticized Obama for being too liberal. If that's true, then it is very disingenuous for him to say now that Obama's failure to raise taxes is a problem.)

[JHB]

11. Kwak may have a position somewhat similar to yours

The excerpt below is from a blog post of his dated Jan 4 (two days after the article for The Atlantic referenced in the Business Insider piece):

But those tax cuts came at the expense of future federal tax revenues, which means they came at the expense of—you guessed it—Social Security, Medicare, and Medicaid. In other words, Obama and the vast majority of the Democrats in Congress chose goodies for low-, middle-, upper-, and very-upper-income families today (the only people not getting goodies are the super-upper-income families that make more than $450,000*) over the fiscal capacity required to preserve our social insurance and safety net programs.

That’s the problem with the tax deal—not the fact that the threshold was set at $450,000 rather than $250,000, which Krugman correctly notes doesn’t make much of a difference. And you can’t say the tax cuts were a necessary choice to keep the economy from slipping into recession. If that were the case, they should have been temporary, not permanent, and Obama has been trying to make them permanent since 2010.

The Democratic Party today, as I’ve said countless times over the past year, has become the party of smallish government and tax cuts for most people, while the Republican Party is the party of tiny government and tax cuts for everyone. There is no party dedicated to the New Deal and the Great Society. We need one.

http://baselinescenario.com/2013/01/04/if-only/

I haven't read enough of his work to fully know where I agree with him and where I don't, but the Business Insider writer is using him for a "both sides" framing.

[socialist_n_TN]

14. It might only be one faction, but it holds the power.........

AND it thinks and, more importantly, LEGISLATES in a neo-liberal economic fashion right along with Republicans. It might be neo-liberal lite compared to the Republicans, but the thinking behind the legislation is the same. What's more is this kind of economic outlook goes against what the people want. You can read any Pew Poll on economic questions and see that this is the case. I wonder how long legislation will go against what the people want before there's an explosion of resistance?

[nenagh]

7. Isn't he looking at this through one lens: taxes?

Change Medicare Part D? reduce Rx medication costs... get people who understand to change that system..

I only know the Ontario system of drug pricing..where the Govt regulates what it will pay for Rx meds.

Oops: I seem to have taken up a lot of space here...

[kentuck]

9. Is that type of reform possible now?

After the Democrats rushed to make sure Doctors did not get short-cutted on their Medicare payments in the latest fiscal cliff deal?

[nenagh]

18. I do not know the answer to your very valid point..

But I've dispensed medication for years here in Ontario...(dual citizen, born in Penna)

I don't understand what legislation is required to get a grip on drug costs in the USA ...or can some changes be done internally in some manner.

But a DUer months ago posted that if Medicare drug costs were run like the VA system, great savings could be made.

My ears perked up at that, but I don't really know either system..

Perhaps Elizabeth Warren can articulate a new policy in future years. I hope so..

[rgbecker]

8. When the Tea Party GOP shuts down the government by refusing to pay it's bond holders..

they'll be writing out their own pick slips. If Obama has the guts to let them shut the Federal Government down, we won't be worried about a GOP congress that refuses to raise the revenues necessary to continue funding programs like Medicare, Medicaid, SS and Veteran and government pensions. Or if necessary to reallocate revenues from the Military.

Hopefully Bill CLinton has schooled Obama in the lessons learned in the nineties. People want the Government to function and they will punish those who attempt to shut it down at the polls. Ask Newt Gingrich how the shut down worked for him.

This is about your Democrat in the Senate and Obama and whether they can stand the ground the people have elected them to protect. Programs that help every single American and/or their parents are supported by huge majorities.

[ProSense]

12. What utter garbage

"If a newly re-elected Democratic president can’t muster the political will and capital required to do something as straightforward and relatively popular as raising taxes on the tiny fraction Americans making over $250,000when those same taxes are scheduled to go up already, then how can Democrats ever expect to push taxes upward to levels that would make our existing public programs sustainable for the long run? Democrats ever expect to push taxes upward to levels that would make our existing public programs sustainable for the long run? "

What a silly argument. Typical MSM garbage. Ross Douthat is a conservative tool. Medicare is not in danger, and this piece is trying to create the impression that Medicare cuts have to be a part of the deal, but ignores that so do tax increases.

The President has already identified more than $400 billion in Medicare cuts (savings), and according to the recent deal, any $1 in spending cuts must be matched by $1 in tax revenues. There are also other parameters locked into how sequestration is negotiated.

The Left's Sequester Leverage
http://www.democraticunderground.com/10022129660

Obama offers GOP an ambitious, progressive debt-reduction plan
http://www.democraticunderground.com/10021905787

[freshwest]

13. Thanks, I thought Business Insider was more to the left than to put out this despair piece.

It's more of that black and white thinking again.

[Enrique]

21. Business Insider is just a content farm

so it doesn't have any point of view.

This article is from "The Economist" which overall is right-leaning, though I don't know about this particular blog, "Democracy in America"

http://www.economist.com/blogs/democracyinamerica/2013/01/liberalism

[JHB]

15. The article writer seems to think politics on this can't shift...

...and that this is the high-water mark for the ability to raise taxes, especially at the high end.

There is no reason to simply assume that. Doesn't mean it won't be a fight, or rather a long series of fights, but there is no reason to assume the situation is and will remain static.

And a history lesson to spread:

In 1955 there were 24 tax brackets. Adjusting for inflation:
16 of them affected incomes above the equivalent of $250,000;
11 of those affected incomes over the equivalent of $500,000;
the top rate affected incomes over $3.3 million.

I emphasize the distribution of the brackets and not what the rates themselves actually were (20 to 91%). We can argue about the optimal levels for the tax rates, but showing the distribution points out the fallacy of debating about whether to raise the rates for $250K, or $400K, or a million. It can and has been done for all of them and more.

[TXDem72]

19. Some democrats get into a tizzy

When you tell them this really was a horrible deal. This was our only chance to run the table on more revenues (back to the Clinton era which was a time of great prosperity). Norquist supported this deal because he knew that after this he has the GOP gag bound on not accepting any more revenue raisers as the tax cuts have been made permanent.