OK

Debate transcipts, now with factual smackdown.

In this edition:
"Do you see a major difference between the two of you on Social Security?"

"Do you see a major difference between the two of you on Social Security?"
OBAMA: Well, it's difficult to tell my opponant's position on Social Security, but I would think that a bunch of people taking checks and not going to work might look like 47% of the country to him. I think it looks like an economically sound way to take care of the generation that kept the country going before us, and economists agree. Social Security isn't just an expression of our compassionate committment to the generation above us. It isn't just a promise made to the generation after us. It's good economics, because it helps hold the country together as a community instead of telling everyone to go it alone. Now, despite what my opponent and his backers like to say, Social Security is structurally sound. It's going to have to be tweaked the way it was by Ronald Reagan and Speaker -- Democratic Speaker Tip O'Neill. But it is -- the basic structure is sound.

But -- but I want to talk about the values behind Social Security and Medicare, because that's a major difference between not just Governmor Romney and I, but the two parties as a whole.

You know, my grandmother -- some of you know -- helped to raise me. My grandparents did. My grandfather died a while back. My grandmother died three days before I was elected president. And she was fiercely independent. She worked her way up, only had a high school education, started as a secretary, ended up being the vice president of a local bank. And she ended up living alone by choice.
And the reason she could be independent was because of Social Security and Medicare. She had worked all her life, put in this money, and understood that there was a basic guarantee, a floor under which she could not go.
And that's the perspective I bring when I think about what's called entitlements. What we should be calling earned benefits. Entitlement implies some sense of dependency on the part of these folks. These are folks who've worked hard, like my grandmother, and paid in, and there are millions of people out there who are counting on this.

OBAMA: So my approach is to say, how do we strengthen the system over the long term? And in Medicare, what we did was we said, we are going to have to bring down the costs if we're going to deal with our long-term deficits, but to do that, let's look where some of the money's going.

$716 billion we were able to save from the Medicare program by no longer overpaying insurance companies by making sure that we weren't overpaying providers. And using that money, we were actually able to lower prescription drug costs for seniors by an average of $600, and we were also able to make a -- make a significant dent in providing them the kind of preventive care that will ultimately save money throughout the system. Now, the Governor has attacked me on this figure, but if he'll look at his own plan, he'll see that same savings was in the Ryan Budget that the House passed twice. Now, maybe he's not in favor of the Ryan Budget anymore. Haven't asked him today. Maybe he wants waste and fraud back in the system. I hope not. But we need something done that doesn't scrap this program, doesn't put it at the mercy of the markets, but something that keeps the guiding principle intact while working out the finances. Waste and fraud have got to go, no matter what my opponent says.

So the way for us to deal...

(AUDIO GAP)

a better prescription program.

ROMNEY: That's $1 -- that's $1 for every $15 you've cut. They're smart enough to know that's not a good trade.

I want to take that $716 billion you've cut and put it back into Medicare. By the way, we can include a prescription program if we need to improve it.

But the idea of cutting $716 billion from Medicare to be able to balance the additional cost of Obamacare is, in my opinion, a mistake.

And with regards to young people coming along, I've got proposals to make sure Medicare and Social Security are there for them without any question.

LEHRER: Mr. President?

OBAMA: First of all, you were offered 10 to 1 in cuts to taxes during your primary and you said no, and now you're against 15 to 1. How exactly do you plan to fund your administration? A Loophole in every Pot? I think it's important for Governor Romney to present this plan that he says will supposedly only affect folks in the future. These future voters, I like to call them 55 year olds, they might like to see that plan.
And the details he has revealed show that he would turn Medicare into a voucher program. It's called premium support, but it's understood to be a voucher program. His running mate...

LEHRER: And you don't support that?
OBAMA: I don't. And let me explain why.

ROMNEY: Again, that's for future...

OBAMA: I understand. 55 year olds. The future.

ROMNEY: ... people, right, not for current retirees.

OBAMA: For -- so if you're -- if you're 54 or 55, you might want to listen 'cause this -- this will affect you.

The idea, which was originally presented by Congressman Ryan, your running mate, is that we would give a voucher to seniors and they could go out in the private marketplace and buy their own health insurance.

The problem is that because the voucher wouldn't necessarily keep up with health care inflation, it was estimated that this would cost the average senior about $6,000 a year.
Now, in fairness, what Governor Romney has now said is he'll maintain traditional Medicare alongside it. But there's still a problem, because what happens is, those insurance companies are pretty clever at figuring out who are the younger and healthier seniors. They recruit them, leaving the older, sicker seniors in Medicare. And every health care economist that looks at it says, over time, what'll happen is the traditional Medicare system will collapse.

OBAMA: And then what you've got is folks like my grandmother at the mercy of the private insurance system precisely at the time when they are most in need of decent health care.

So, I don't think vouchers are the right way to go. And this is not my own -- only my opinion. AARP thinks that the -- the savings that we obtained from Medicare bolster the system, lengthen the Medicare trust fund by eight years. Benefits were not affected at all. And ironically, if you repeal Obamacare, and I have become fond of this term, "Obamacare," if you repeal it, what happens is those seniors right away are going to be paying $600 more in prescription care. They're now going to have to be paying copays for basic checkups that can keep them healthier.

And the primary beneficiary of that repeal are insurance companies that are estimated to gain billions of dollars back when they aren't making seniors any healthier. And I don't think that's the right approach when it comes to making sure that Medicare is stronger over the long term.

LEHRER: We'll talk about -- specifically about health care in a moment. But what -- do you support the voucher system, Governor?
ROMNEY: What I support is no change for current retirees and near-retirees to Medicare. And the president supports taking $716 billion out of that program.
LEHRER: And what about the vouchers?
ROMNEY: So that's -- that's number one.
Number two is for people coming along that are young, what I do to make sure that we can keep Medicare in place for them is to allow them either to choose the current Medicare program or a private plan. Their choice.
They get to choose -- and they'll have at least two plans that will be entirely at no cost to them. So they don't have to pay additional money, no additional $6,000. That's not going to happen. They'll have at least two plans.

ROMNEY: And by the way, if the government can be as efficient as the private sector and offer premiums that are as low as the private sector, people will be happy to get traditional Medicare or they'll be able to get a private plan.
I know my own view is I'd rather have a private plan. I'd just assume not have the government telling me what kind of health care I get. I'd rather be able to have an insurance company. If I don't like them, I can get rid of them and find a different insurance company. But people make their own choice.

The other thing we have to do to save Medicare? We have to have the benefits high for those that are low income, but for higher income people, we're going to have to lower some of the benefits. We have to make sure this program is there for the long term. That's the plan that I've put forward.

And, by the way the idea came not even from Paul Ryan or -- or Senator Wyden, who's the co-author of the bill with -- with Paul Ryan in the Senate, but also it came from Bill -- Bill Clinton's chief of staff. This is an idea that's been around a long time, which is saying, hey, let's see if we can't get competition into the Medicare world so that people can get the choice of different plans at lower cost, better quality. I believe in competition.

OBAMA: Jim, if I -- if I can just respond very quickly, first of all, the 716 billion dollars in waste and fraud that Governor Romney wants to put back into Medicare, that's that same savings that his running mate included in his budget, which the Republican House voted in favor of twice. But he's against it now. I guess he's his own man today. Second, every study has shown that Medicare has lower administrative costs than private insurance does, which is why seniors are generally pretty happy with it.

And private insurers have to make a profit. Nothing wrong with that. That's what they do. And so you've got higher administrative costs, plus profit on top of that. And if you are going to save any money through what Governor Romney's proposing, what has to happen is, is that the money has to come from somewhere.

And when you move to a voucher system, you are putting seniors at the mercy of those insurance companies. And over time, if traditional Medicare has decayed or fallen apart, then they're stuck.

And this is the reason why AARP has said that your plan would weaken Medicare substantially. And that's why they were supportive of the approach that we took.

One last point I want to make. We do have to lower the cost of health care, not just in Medicare and Medicaid...

LEHRER: Talk about that in a minute.
OBAMA: ... but -- but -- but overall.
LEHRER: OK.
OBAMA: And so...

ROMNEY: That's -- that's a big topic. Can we -- can we stay on Medicare?

OBAMA: Is that a -- is that a separate topic?

(CROSSTALK)

LEHRER: Yeah, we're going to -- yeah, I want to get to it.
OBAMA: I'm sorry.
LEHRER: But all I want to do is go very quickly...
ROMNEY: Let's get back to Medicare.
LEHRER: ... before we leave the economy...
ROMNEY: Let's get back to Medicare.

(CROSSTALK)

ROMNEY: The president said that the government can provide the service at lower cost and without a profit.

LEHRER: All right.
ROMNEY: If that's the case, then it will always be the best product that people can purchase.
LEHRER: Wait a minute, Governor.
ROMNEY: But my experience -- my experience the private sector typically is able to provide a better product at a lower cost.
LEHRER: All right. Can we -- can the two of you agree that the voters have a choice -- a clear choice between the two...
ROMNEY: Absolutely.
LEHRER: ... of you on Medicare?
ROMNEY: Absolutely.

OBAMA: Absolutely. We want Medicare, Governor Romney and his running mate want vouchers.

11:12 AM PT: PART 5: Regulations:

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