Of course that leads to the obvious question: then why bother? Why not work with the so-far experimental index for seniors, the CPI-E, if a new index is in order. That answer is easy. Because chained CPI is a cut, and the administration wants to offer up this sacrifice of the elderly as a warped expression of "good faith." Good faith to the Republicans, not to the rest of us. But what Orszag is also saying, as TMP's Brian Beutler points out, is that switching to the chained CPI isn't going to do all that for deficit reduction.
Republicans have already dismissed the offer as not going far enough, as small ball that if the president really wanted he'd have done already. Since even President Obama's former OMB director (you can hear them say now, gleefully) says that it won't really do much for the deficit, then Social Security must be cut more. If, you know, he really means it.
But it wasn't entirely Republicans Obama was reaching out to, Beutler says, and that part of his goal "was to win the battle for elite opinion by positioning himself between those on his left criticizing him for preemptively conceding (and, worse, putting Social Security on the chopping block) and the entire GOP, which evidently can’t take yes for an answer." If so, mission not accomplished. Elite opinion is essentially Republican opinion. If Republicans will use Orszag's argument as ammunition against Obama, the elites—the Very Serious People—will use it as proof that much, much more needs to be done to hurt the elderly if the deficit beast is to be tamed. Even though Social Security does not contribute to the deficit. That doesn't matter. What matters is Obama's willingness to make people actually hurt. So even just as an effort triangulation to prove that he is really willing to piss off his base, it is likely to fail.
The Very Serious People are the only constituency Obama has in making this offer. Republicans have already, repeatedly, rejected it. He put his fellow Democrats in a terrible, terrible position in making it. The public certainly is massively opposed to it. And now Peter Orszag has ruined his chances of getting the VSPs on his side.
The good news is that this budget is almost certainly DoA. The bad news is that the Rubicon has been crossed. A Democratic president, who still has three years in office to try to prove himself to the VSPs, has sacrificed Social Security benefit cuts, and set himself up to be pushed into offering up much, much more.
That's why we have to keep fighting it. Send an email to the White House telling President Obama to give up the chained CPI cuts to Social Security and veterans.