Thursday, June 30, 2011

Why is the Social safety Net the Deficit Reduction Target?

June 30, 2011

A few weeks ago, in his speech on the deficit, President Obama gave a little history of how we got here. At the end of the Clinton presidency, we had a projected budgetary surplus. According to the president we knew we could manage the baby boomer retirements. This was a result of some cost cutting, some increased taxes and a generally strong economy.

Then under George W Bush, we cut taxes drastically, particularly on the wealthy. We suffered the 9/11 attacks. We launched two wars on borrowed money. We had a great recession with massive worker layoffs, causing the tax base to shrink.

Nothing on this list show the cost of the social safety net as the reason for the deficit. Yet, the main plan for dealing with the deficit is to "reform" medicare. Presumably medicaid and social security itself is not far behind.

I firmly believe the reason is political. The republicans have been against these programs from the very beginning of the New Deal. They sense that frightening the American people over the deficit can win the argument and the political battle they have been fighting since the 1930s.

This blog is dedicated to providing information and yes, opinion, with which to arm ourselves in this battle.

The Attack From the Right

June 30, 2011

I first heard the term "social safety net" in a speech by Ronald Reagan. After campaigning against social security, but realizing the battle was not a political winner he used this term to describe social security, medicare and medicaid. The republicans today believe they can win the political battle. They are on the attack.

The first salvo was Rep.Paul Ryan's plan, which has passed in the house of Representatives. This plan features defined payments to eligible seniors to purchase private insurance. The payments would approximate the price of medicare in 2012 minus already existing senior contributions.

Some clear problems for seniors
1. The Ryan plan does not allow for the growth in health care cost, so each year the payments would become more inadequate to the actual need.

2. The Ryan plan presumes private insurance would be available. Yet, it makes no provision to deal with the current difficulty of seniors obtaining private health care insurance at any price.

It has been promised that these changes would not effect current beneficiaries, but only those who are today under 55. Politicians do occasionally mangle the truth.

Tomorrow: New Senate plan authored by Sen.Lieberman and Sen.coburn