Tuesday, October 2, 2012

Just What We Need

So, is my timing good or not? Right after I warn about the risk that Democrats, including the president, might betray the mandate they seem likely to get for preserving the safety net, we learn that Senate leaders are at work on a plan based around, well, you guessed it:
[Krugman then quotes Jonathan Weisman at NYT, who examines possible outcomes of attempts to avert the sadly misnamed "fiscal cliff" triggered by last year's budget negotiation failure, and finds an outcome distressingly similar to Bowles/Simpson. - SB]
Just to say, this would be politically stupid as well as a betrayal of the electorate. If you don’t think Republicans would turn around and accuse Democrats of cutting Social Security — probably even before the ink was dry — you’ve been living under a rock.
Bowles/Simpson 'Nest Egg'
Social Security Plan
Yes, Mr. President, that would be politically ill-advised.

If you want to risk your lead in the polls for a real-world result that no one with an income under a half-million bucks a year wants to see, by all means, let this misbegotten effort go forward.

If, on the other hand, you want to keep the "votingest" part of your base... senior citizens... talk to the "Senate leaders" with whom you have the most influence and attempt to avert this catastrophe.

AFTERTHOUGHT: Dean Baker, co-director of CEPR (Center for Economic and Policy Research), has cross-posted an article on CEPR and TruthOut titled "Does President Obama Want to Cut Social Security by 3 Percent?" Sadly, given Obama's repeated advocacy of Bowles-Simpson, the answer appears to be yes:

One of the items in the Bowles-Simpson plan is a reduction in the annual cost-of-living adjustment of roughly 0.3 percentage points. This would be accomplished by using a different index that, by design, would show a lower measured rate of inflation. It is important to recognize that this is an annual cut that would accumulate over time. After a retiree has been receiving benefits for 10 years the cut would be 3.0 percent, after 20 years it would be 6 percent. If a typical retiree lives long enough to get benefits for 20 years the average benefit cut over their years of retirement would be 3 percent.

Baker notes that these are not the only cuts to Social Security in Bowles-Simpson, which, remember, has Mr. Obama's support:

... The plan also would gradually raise the age at which retirees receive full benefits to 69. It also phases in a reduction in benefits for workers whose earnings averaged more than $40,000 a year over their working lifetime.

Sixty-nine is an age to which many people simply do not live, especially people in lower socioeconomic classes with less access to health care during their working years. And reducing benefits for workers who earned an average of over $40,000 a year... really a very modest income by today's standards... seems grossly unfair in light of tax cuts for the oligarchy that have been passed since G.W. Bush took office in 2001.

If Mr. Obama wants the support of Morgan Stanley board member Bowles and retired wealthy Republican Sourpuss, er, Senator Simpson, I'm sure he's got it. If he wants the votes of a substantial majority of seniors in November, I'm not so sure. Perhaps he needs to rethink the matter.

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