GOP Super Committee Co-Chair: Lawmakers Failed Because Democrats Refused To Privatize Medicare
Rep. Jeb Hensarling (R-TX) faults the Democrats’ refusal to accept partial Medicare privatization for the super committee’s inability to come up with a bipartisan plan to lower spending in today’s Wall Street Journal. He writes, “Democrats on the committee made it clear that the new spending called for in the president’s health law was off the table” and pretends that the spending in the Affordable Care Act added to the deficit (it actually reduces it). “Republicans offered to negotiate a plan on the other two health-care entitlements—Medicare and Medicaid—based upon the reforms included in the budget the House passed earlier this year,” he continues and lays out the premium support proposal offered by Alice Rivlin and Pete Domenici:
The Medicare reforms would make no changes for those in or near retirement. Beginning in 2022, beneficiaries would be guaranteed a choice of Medicare-approved private health coverage options and guaranteed a premium-support payment to help pay for the plan they choose….These seniors would be able to choose from a list of Medicare-guaranteed coverage options, similar to the House budget’s approach—except that Rivlin-Domenici would continue to include a traditional Medicare fee-for-service plan among the options.
This approach was also rejected by committee Democrats.
The Congressional Budget Office, the Medicare trustees, and the Government Accountability Office have each repeatedly said that our health-care entitlements are unsustainable. Committee Democrats offered modest adjustments to these programs, but they were far from sufficient to meet the challenge. And even their modest changes were made contingent upon a minimum of $1 trillion in higher taxes—a move sure to stifle job creation during the worst economy in recent memory.
Hensarling doesn’t mention that the Rivlin-Domenici premium-support proposal doesn’t so much lower national health care spending as it shifts it to the beneficiary. The plan reduces the federal contribution to Medicare by capping costs for each beneficiary and offering premium support credits that won’t keep up with actual health care spending. The federal government spends less, but seniors will pay more out of pocket for health care benefits every year. The proposal also breaks up the market clout of traditional Medicare and rather than ratcheting up some of efficiencies and payment reforms in the Affordable Care Act, it sets the nation on an untested path of private competition — leaving seniors vulnerable to the manipulations of for-profit health insurers.
Democrats, for their part, offered rather substantial concessions on Medicare spending. As the Center on Budget and Policy Priorities argued, the Democrats’ $3 trillion deficit proposal to the super committee “stands well to the right of plans by the co-chairs of the bipartisan Bowles-Simpson commission and the Senate’s ‘Gang of Six,’ and even further to the right of the plan by the bipartisan Rivlin-Domenici commission.” The plan contained “substantially smaller revenue increases than those bipartisan proposals while, for example, containing significantly deeper cuts in Medicare and Medicaid than the Bowles-Simpson plan.” For instance, Bowles-Simpson offered $383 billion in Medicare and Medicaid, while Democrats put $475 billion on the table.
President Obama introduced $320 billion in health care savings, mostly from the pharmaceutical industry and other providers, including rural hospitals, teaching hospitals, and biotechnology firms. But the plan even incorporated the GOP’s push for greater means testing in Medicare, asking some wealthier beneficiaries to pay more for coverage and sought to give beneficiaries “skin in the game” — as the GOP puts it — to discourage over treatment.
All of these are significant concessions — as are the health cuts included in the trigger mechanism — but Hensarling and Republicans aren’t interested in bipartisan agreement. They’re not accepting anything short of Medicare privatization.
By: Igor Volsky, Think Progress, November 22, 2011
With Economic Plans, GOP Abandons Middle Class Entirely
I have watched with a truly curious sense of amazement as the Republicans, especially the presidential candidates, have stuck it to the middle class.
What have they been thinking with their tax plans and their relentless pursuit of even greater tax-cut largess for the very wealthiest of Americans? What do they have against the middle class, those who have seen their incomes drop by 4.8 percent this past decade, according to a report in the Wall Street Journal?
The latest Republican proposal made to the Senate’s Gang of 12 “supercommittee” is to lower the tax rate on the top wage earners from 35 percent to 28 percent; this on top of the temporary tax cut that Bush provided. The Republicans propose various revenue increases to help reduce the budget deficit but take them away with this giveaway to the wealthy.
Once again, the middle class is left holding the bag, watching as they get stuck with less take-home pay and more expenses for rent, mortgage, college tuition, basic essentials.
Let’s look at the Republican presidential candidates‘ tax proposals. Governor Perry has proposed a huge tax windfall for those whose income averages over a million dollars. For those millionaires and billionaires, he would give them a $512,733 average tax break! How can that possibly be justified since these wage earners have seen a 385 percent increase in their wealth over the last 20 years?
Perry’s plan would actually see tax rates go up for those who make less that $50,000, according to the Tax Policy Center.
Herman Cain’s pie in the sky 9-9-9 plan would see the poor and middle class lose with a 15.8 percent drop; those families who make the average of $49,445 would see their effective tax rate go from 14.3 percent to 23.8 percent, according to the Tax Policy Center.
The Romney tax plan is more of the same. More tax cuts for the wealthy: 67 percent of his lower capital gains taxes would go to millionaires; 50 percent of the continuation of the Bush tax cuts go to the top 5 percent of wage earners.
The policy prescriptions we are seeing from Republicans as we approach 2012 are coupled with a complete lack of explanation of why it is important to help middle-class families. All their rhetoric is ideological—anti-Washington, anti-government, anti-taxes. They have drunk the Grover Norquist Kool-Aid, even to the detriment of those families struggling to make it in a tough economy.
The benefits go to Wall Street, not Main Street; the analyses of all the tax plans clearly point to giveaways to those top 2 percent of Americans, with the squeeze put on those in the middle.
As they campaign in the next 12 months, the Republicans will find it increasingly difficult to make the case that they stand for hard-working, middle-class families. This could well be their downfall come next November.
By: Peter Fenn, U. S. News and World Report, November 9, 2011
We Are Living In The Conservative Recovery, And It’s Pretty Terrible
In talking about the economy, the Republican presidential candidates are quick to blame government spending for our current woes. “On my first day in office, I will send five bills to Congress and issue five executive orders that will get government out of the way and restore America to the path of robust economic growth that we need to create jobs,” said former Massachusetts Governor Mitt Romney when he unveiled his jobs plan in September. Likewise, in his plan, Texas Governor Rick Perry touts spending cuts as part of the road toward renewed economic growth: “The cut, balance, and grow plan paves the way for the job creation, balanced budgets, and fiscal responsibility that we need to get America working again.”
The problem, as Neil Irwin reports for The Washington Post, is that sharp cuts to government have been terrible for the recovery. Thanks to lower revenue, limited federal aid, and budget-cutting state legislators, the public sector has cut 455,000 jobs since the beginning of 2010, sending the proportion of government jobs to 16.7 percent, the lowest level in three years. These cuts have been a huge drag on the recovery -– to wit, October saw private-sector job growth of 104,000, which was offset by the loss of 24,000 public-sector jobs, for a net increase of 80,000 jobs. This dynamic has been true of every month since the recovery officially began.
Far from unleashing the power of the private sector, cuts to government have prolonged the economic pain, as demand is removed from the economy without an adequate replacement. Despite this, conservatives continue to press for further and greater cuts to government spending –- the Pentagon notwithstanding. What conservatives refuse to acknowledge is that we are living through the recovery they say they want, and it’s been disastrous.
By: Jamelle Bouie, The American Prospect, November 7, 2011
How The Rich Created The Social Security “Crisis”
Now and then, George W. Bush told the unvarnished truth—most often in jest. Consider the GOP presidential nominee’s Oct. 20, 2000, speech at a high-society $800-a-plate fundraiser at New York’s Waldorf-Astoria. Resplendent in a black tailcoat, waistcoat and white bow tie, Bush greeted the swells with evident satisfaction.
“This is an impressive crowd,” he said. “The haves and the have-mores. Some people call you the elites; I call you my base.”
Any questions?
Eight months later, President Bush delivered sweeping tax cuts to that patrician base. Given current hysteria over what a recent Washington Post article called “the runaway national debt,” it requires an act of historical memory to recall that the Bush administration rationalized reducing taxes on inherited wealth because paying down the debt too soon might roil financial markets.
Eleven years later, the Post warns in a ballyhooed article, reading like something out of Joseph Heller’s “Catch-22,” that Social Security—the 75-year-old bedrock of millions of Americans’ retirement hopes—has “passed a treacherous milestone,” gone “cash negative,” and “is sucking money out of the Treasury.”
Anybody who discerns a relationship between these events, that is, between a decade of keeping the “have-mores’” yachts and Lear jets running smoothly and a manufactured crisis supposedly threatening grandma’s monthly Social Security check must be some kind of radical leftist.
That, or somebody skeptical of the decades-long propaganda war against America’s most efficient, successful and popular social insurance program. It’s an effort that’s falsely persuaded millions of younger Americans that Social Security is in its last days and made crying wolf a test of “seriousness” among Beltway courtier-pundits like the Post’s Lori Montgomery, who concocted an imaginary front page emergency out of a relatively meaningless actuarial event.
All in service, alas, of a single unstated premise: The “have-mores” have made off with grandma’s money fair and square. They have no intention of paying it back. That’s the only possible interpretation of the Post’s admonition that “the $2.6 trillion Social Security trust fund will provide little relief. The government has borrowed every cent and now must raise taxes, cut spending or borrow more heavily from outside investors to keep benefit checks flowing.”
Little relief? In fact, the law’s working precisely as intended. After 28 years of generating huge payroll tax surpluses to cover the baby boomers’ retirement benefits, the system must now begin to draw upon those funds to help pay current benefits—the vast majority still covered by current payroll tax receipts.
“Rather than posing any sort of crisis,” explains Dean Baker of the Center for Economic and Policy Research, “this is exactly what had been planned when Congress last made major changes to the program in 1983 based on the recommendations of the Greenspan commission.”
Again, this is the beneficiaries’ money, invested by the Social Security trustees in U.S. Treasury bonds drawn upon “the full faith and credit of the United States.” Far from being “meaningless IOUs” as right-wing cant has it, they represent the same legally binding promise between the U.S. government and its people that it makes with Wall Street banks and the Chinese government, which also hold Treasury Bonds.
A promise not very different, the Daily Howler’s Bob Somerby points out, from the one implicit in your bank statement or 401K (if you’re lucky enough to have one). Did you think the money was buried in earthen jars filled with gold bullion and precious stones?
Raise taxes, cut spending or borrow? What other options does the U.S. government, or any government, have?
On his New York Times blog, Paul Krugman dissects the Catch-22 logic behind the Post’s bogus crisis. You can’t simultaneously argue “that the trust fund is meaningless, because SS is just part of the budget, then claim that some crisis arises when receipts fall short of payments, because SS is a standalone program.” For practical purposes, it’s got to be one or the other.
So is Social Security a “Ponzi scheme”? No, it’s group insurance, not an investment. You die young, somebody else benefits. Its finances have been open public record since 1936. Do fewer workers support each beneficiary? Sure, but who cares? It’s denominated in dollars, not a head count. The boomers were nearing 40 when the Reagan administration fixed the actuarial tables. No surprises there.
Are longer life expectancies screwing up the numbers? Not really. Most of the rise is explained by lower infant and child mortality, not by old-timers overstaying their welcome. Kevin Drum points out that gradually raising the payroll tax 1 percent and doubling the earnings cap over 20 years would make Social Security solvent forever.
But that’s not good enough for the more hidebound members of the $800-a-plate set. See, over 75 years Social Security has provided a measure of dignity, security and freedom to working Americans that just annoys the hell out of their betters.
By: Gene Lyons, Salon, November 2, 2011
Who’s Paying For The GOP’s Plan To Hijack The 2012 Election?
Over the past six months, someone—or a group of someones—has spent hundreds of thousands of dollars to fund an effort to change the rules of the 2012 presidential election to make it very difficult for President Barack Obama to win reelection. But the shadowy lobbying group mounting this campaign hasn’t disclosed its donors—and under current law, it doesn’t have to.
In two states, Pennsylvania and Wisconsin, GOP legislators have introduced bills that would change how electoral votes—a candidate needs 270 of the 538 to win the presidency—are awarded in a presidential election. Under the current system, the winner of the statewide popular vote receives all of the electoral votes from that state.
If the Republican plan becomes law in either Wisconsin and Pennsylvania, those states would change how electoral votes are awarded. The new plan would allot electoral votes on the basis of vote totals within congressional districts. If a candidate wins a congressional district, he or she would receive one electoral college vote. Whoever does best in the statewide race would receive two electoral votes.
Because Republicans will draw the boundaries of the congressional districts in both states, the new rules would mean that Obama could win the states but still receive fewer electoral votes than his Republican opponent. Should a Republican split the states’ electoral votes with Obama (even if Obama draws more votes), that could provide the GOPer with the margin of victory in a close race. (Under the US Constitution, it is up to the states to allot electoral votes as they see fit.)
In Pennsylvania, a secretive nonprofit group called All Votes Matter has been pushing the electoral vote scheme since May. All Votes Matter has close ties to the Pennsylvania GOP—it hired a number of former top state Senate staffers-turned-lobbyists. “It was pretty much the Senate GOP All Star Lobbying Team and [former state House Democratic Counsel Bill] Sloane,” Peter DeCoursey, the bureau chief for Capitolwire, a newswire that’s read religiously by Harrisburg insiders, explained in September.
Between April and June, the group spent $77,700 to lobby state officials to support legislation to implement this scheme. By early September, GOP Gov. Tom Corbett and the state House and Senate leaders, Mike Turzai and Dominic Pileggi, both Republicans, had all expressed their support for the idea. It was “the best $77,700 anyone ever spent on potential legislation,” DeCoursey wrote. “The entire state governing wing [was] for a bill that [hadn’t] been introduced yet.”
A week later, though, the landscape had changed significantly. Mother Jones and other national media outlets drew widespread attention to the story, and the state GOP chairman and the vast majority of its congressional delegation came out against the plan.
All Votes Matter wasn’t fazed. It kept lobbying. Charles Gerow, a spokesman for All Votes Matter, told DeCoursey that the group had raised $300,000—and already spent $180,000. But Gerow wouldn’t tell reporters where the money was coming from, saying only that “civic-minded citizens” had provided the dough. This week, the group filed new lobbying disclosure forms revealing that it spent $186,882 on lobbying between July and September.
All Votes Matter doesn’t disclose its donors “as a matter of policy, per the request of many of them,” Gerow told Mother Jones. “It’s their legal right not to have it disclosed, and they don’t want it disclosed so they’re not subject to media calls and other potential harassment,” he added. All Votes Matter has “fully and completely complied with the law and will continue to do so,” Gerow said, and “if those who don’t agree with the law want to change it, it certainly is their right to do that.”
There’s no law that says All Votes Matter has to disclose where its money comes from. But opponents of the electoral college changes are outraged that voters are being kept in the dark about who’s behind such a potentially consequential reform. “This is an effort to fundamentally change the way Pennsylvania conducts its presidential elections, in my view to rig the election,” says Democratic state Sen. Daylin Leach. “They raised an awful lot of money very quickly—$300,000 in just a few days. We’re all curious where that level of funding comes from.”
Carolyn Fiddler, a spokeswoman for the Democratic Legislative Campaign Committee, which assists Democrats in state-level races around the country, says: “Given the potential impact of this measure this group is lobbying for, not just for Pennsylvanians but for presidential politics and Americans in general, the public has a right to know who’s behind it.”
Transparency advocates say it’s not enough to just know who is doing the lobbying—voters should also know who is paying the bills. “The old adage is that actions speak louder than words, and deeper pockets allow for more action,” says Michael Beckel, a spokesman for the Center for Responsive Politics. “Without disclosure, the public is unable to fully hold accountable the companies and organizations that have hired these lobbyists in the first place.”
In Wisconsin, it’s even less clear who’s behind the electoral college shenanigans. The Wisconsin Democratic party has alleged that the bill there, sponsored by GOP state Rep. Dan LeMahieu, was written by the American Legislative Exchange Council, a conservative group funded by the billionaire Koch brothers, among others. But so far, the Dems haven’t been able to produce any evidence to back up their charge, and emails from LeMahieu’s office Mother Jones obtained via an open records request showed no evidence of any outside involvement in the drafting of the law.
Democratic state legislators are worried that the Pennsylvania and Wisconsin bills are part of a broader effort. If GOP legislatures in Pennsylvania, Wisconsin, and other states where Democrats typically win presidential elections pass the electoral college changes All Votes Matter is proposing, it would mean “the end of competitive presidential elections and certainly people’s confidence that the process is fair,” Leach maintains. “To think that some secret group somewhere is rubbing their hands together and putting millions of dollars into this effort—and we can’t even know who they are—I think that’s obscene.”
By: Nick Baumann, Mother Jones, November 2, 2011
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