Many progressives here argue that because we passed the Senate's fiscal cliff bill, we have lost leverage. They argue, therefore, that we will gut Medicare and Social Security.
Let's consider that, shall we ?
Below the squiggle :
So, what was actually in the Senate fiscal cliff bill ? It was a $41 to $1 ratio of tax revenue to spending cuts. So, we got stuff without spending cuts. So, we got it for free.
One can argue that we lost all that revenue - but we did not want tax rates to go up on 98% of Americans any more than they already will (with the end of the payroll tax rate holiday). So, most of that was going away no matter what. Raising taxes on the middle class now would be both bad economics and bad politics. Taxes did not go up as much as they would have for those making $250 K to $400 K - true. However, they did go up - itemized deductions were eliminated for them. The marginal rates were returned to the Clinton years for those making $400 K individually and $450 K as a household.
Unemployment Insurance was extended for a year. "Well, they would have or should have extended it anyway. " - The House GOP would not accept extending unemployment insurance for a year without an offset in spending. They would have accepted it only as they did, as part of a package deal. This means that people who are without work can eat and live. Political points and poisoning their national brand are not sufficient reasons to allow people to go hungry.
In addition, we got the following goodies :
—Estate tax: Estates would be taxed at a top rate of 40 percent, with the first $5 million in value exempted for individual estates and $10 million for family estates. In 2012, such estates were subject to a top rate of 35 percent.Clearly, as even the bill's detractors admit, the bill, considered by itself, is hardly a bad bill. So, why do some Kossacks oppose it ?
—Capital gains, dividends: Taxes on capital gains and dividend income exceeding $400,000 for individuals and $450,000 for families would increase from 15 percent to 20 percent.
—Alternative minimum tax: Permanently addresses the alternative minimum tax and indexes it for inflation to prevent nearly 30 million middle- and upper-middle income taxpayers from being hit with higher tax bills averaging almost $3,000. The tax was originally designed to ensure that the wealthy did not avoid owing taxes by using loopholes.
—Other tax changes: Extends for five years Obama-sought expansions of the child tax credit, the earned income tax credit, and an up-to-$2,500 tax credit for college tuition. Also extends for one year accelerated "bonus" depreciation of business investments in new property and equipment, a tax credit for research and development costs and a tax credit for renewable energy such as wind-generated electricity.
—Unemployment benefits: Extends jobless benefits for the long-term unemployed for one year.
—Cuts in Medicare reimbursements to doctors: Blocks a 27 percent cut in Medicare payments to doctors for one year. The cut is the product of an obsolete 1997 budget formula.
They argue that we no longer have the shadow of an impending marginal tax rate increase hanging over their heads. Therefore, we have lost our ability to motivate them to provide a reasonable compromise to avoid the sequester and avoid defaulting on our debt.
First, allow me to simply point out that this is silly. We can always put together a bill that addresses tax rates at any time. So, that is a silly thought.
Nevertheless, the argument goes that Republicans will threaten to allow us to suffer the sequester and default on our debt. Therefore, the argument goes, we will agree to gut Medicare and Social Security to avoid it.
Those who think this way have not done enough research on the sequester. Let us consider the actual effects of the sequester :
Under the terms of those cuts, most military programs face a 9.4 percent reduction, while most domestic programs would be sliced by 8.2 percent. Medicare would be trimmed by 2 percent, while other social programs — excluding Social Security — would be sliced by as much as 10 percent.
White House officials said cuts to Medicare would fall on health care providers, not beneficiaries.Big cuts would hit the military. Defense Department operations and maintenance would lose $3.9 billion next year alone. Air Force and Navy aircraft procurement would be sliced by more than $4.2 billion. And money to strengthen Afghanistan’s security force the year before the United States plans to withdraw its own forces would fall by $1.3 billion.
Pain would be spread widely. The National Institutes of Health would lose $2.5 billion. Rental assistance for the poor would fall by $2.3 billion; nutrition programs for women, infants and children would lose $543 million.
Domestic priorities more associated with Republicans would also take a hit. The Customs and Border Patrol budget would fall by $823 million, and the budget for the border fence would drop $33 million.
More about the sequester is found here :
If it fails -- and as of now, Obama and Republicans are at loggerheads, with the election less than eight weeks away -- defense spending would be cut by 9.4%, non-defense spending by 8.2%, most entitlement programs by 7.6% and Medicare providers by 2%.The sword of Damocles is hanging over them more than us with the sequester. Earned benefits (Medicare, Medicaid, and Social Security's benefits) are not cut at all. They are protected. There is a cut to Medicare providers. So, basically, the big three are left alone. So, if they threaten to allow the sequester to take place, we will not feel any unique threat to our programs that is greater than the threat that they will feel to defense. So, we simply point out that earned benefits will not be touched, that defense will be blasted, and say, "Do what you will." .
"It makes glaringly clear that those programs most closely related to combat readiness of the force will be severely cut," said Senate Minority Leader Mitch McConnell.
"Today's ominous report confirms what so many defense officials have warned in regard to sequestration, including the Chairman of the Joint Chiefs, who declared it an 'unacceptable risk,' and Defense Secretary (Leon) Panetta, who compared it to 'shooting ourselves in the head,'" said House Republican Conference Chairman Jeb Hensarling, who co-chaired the bipartisan panel that failed to come up with an alternative. "This report comes not long after the Congressional Budget Office confirmed that allowing sequestration to occur at the same time that taxes go up, as the president wants, would drive the nation over a 'fiscal cliff.'"
So, the sequester is not a unique threat to us. So, they do not gain any leverage from that.
They can argue that we should cut earned benefits because we raised taxes on the wealthy some. Fine, let them make that argument. However, that argument is not a threat to us. There is no threat that they can make that does not endanger them more than us.
What are the worst measures (measures which I oppose by the way - as I have all along) that can pass the Senate ? The chained CPI cuts and raising the Medicare Eligibility age from 65 to 67. Those are the only changes to earned benefits that Democrats will even consider. However, would they accept those measures simply because Republicans argued that they had compromised and now it was our turn ? Hardly. What threat would they have ? None. So, would those changes pass the Senate ? Probably not, no matter what they offered. There probably would be a filibuster by our side. And if those measures were somehow accepted, then serious tax revenue would be demanded as well. The Senate Democrats will not pass those measures unless they get serious new tax revenue. They will simply tell them, "No. Why should we? Make us! " There is nothing the republicans can do at that point. They can try to win the public relations game, but we have easy answers to that. Today's GOP rightly has a terrible image in the mind of the public regarding economic policy / fiscal policy.
So, then, what are they left with ? We will allow the country to default. President Obama has repeatedly said that he will not negotiate in order to get a debt ceiling bill passed. He reiterated that commitment immediately after the bill passed the House of Representatives. President Obama said that he had learned his lesson about not negotiating for the debt ceiling. Vice President Joe Biden told the House Democrats that they would allow the country to default rather than negotiate for a new debt ceiling bill.
Given what they have said, then default is not a weapon that Republicans can use either. Undoubtedly, if we default, Republicans will own that in the mind of the voters. Moreover, Wall Street will corral them and push them into eventually accepting a new clean debt ceiling bill.
These are the reasons that progressives like Senators Sherrod Brown and Sanders and almost all Senate Democrats voted for the Senate fiscal cliff bill. Raul Grijalva and Keith Ellison, co chairs of the Congressional Progressive Caucus, also supported it. The House Democrats who opposed it are, by and large, blue dogs. And Red State is howling about it.
If the bill is so bad and should have been defeated on progressive principles, then why did almost all progressives in the US Congress vote for it ? Are people here more informed and more progressive than Socialist Senator Bernie Sanders and Senator Sherrod Brown ? Is that what you are really telling me ? Are you really saying that they are sell outs ? Because if you say President Obama caved and sold us out, then you must also say that Senator Sanders and Senator Brown and Congressmen Grijalva and Ellison also are sell outs and also caved. Is that really a position that you want to advocate ?
11:42 AM PT: Again, my thought is not that the deal is perfect or that I would not have preferred better terms; my thought is that the deal is not bad. The deal is better than no deal.
I oppose chained cut CPI since (1) Social Security does not contribute a penny to the national debt (2) it will hurt seniors (3) the cut would contribute less than $200 Billion over a DECADE and our deficit is $1Trillion. I oppose raising the Medicare eligibility age since the problem is not actually the aging population and that moving the age up does not address rising health care costs and since this also contributes less than $200Billion over a DECADE to our $1Trillion deficit. Other options like raising the cap might be better, but neither of those are helpful.
11:51 AM PT: Purge the epithet Obama name callers from your midst and we can have a reasonable and constructive dialogue. Align yourself with those who are more thoughtful and who offer more reasonable and informed positions. Then, we can work together. As you know, I first started at DKos in 2006 as math4barack. My values are progressive values. I don't categorically reject criticism of the President's policies or views. I dislike and do not approve of or agree with ad hominem attacks on the President and his character. I do not find such attacks constructive; I find them divisive. I will tell you that President Obama is quite popular among Democrats and will be even more popular when he leaves. He will leave nearly deified by our party.
Criticize policies or bills. Be specific. Offer specific and politically feasible solutions. Support your positions by facts and reason using temperate language. And note the good things that the President has done. And note the good parts of legislation passed. Show some perspective. Show you understand context. Show you understand the legislative process and the nature of our political system with its three branches. Show some political realism.