Share

Monday, March 18, 2013

I get nervous when I read sentences like this

from Greg Sargent:
But there is no realistic scenario under which Democrats agree to serious entitlement cuts without new revenues, so until this position changes, we’re very likely going to remain stuck in extended sequestration.
It seems to me that progressive watchers of the budget wars like Sargent and Brian Beutler tend to underestimate Obama's capacity to move the goalposts on itself. Remember his alleged retort to Boehner's opening offer late last year to raise about $800 billion in new revenue over ten years via (unspecified) loophole closures: "I get that for free"?  He didn't. And as Sargent's post implies, he won't any time time soon. Relatedly, remember Obama's not-quite-hard line about the Bush tax cuts -- that they would not be extended for households earning over $250k? They were (up to $450k).
Sargent's sentence also throws into sharp relief the confines of the box we're in. Obama would I think prefer certain "entitlement cuts" -- the Medicare nips and tucks in his 2013 budget, chained-CPI for Social Security -- to the sequestration meat ax. More specifically, he would probably like cast further specimens of his kind of entitlement cuts -- Medicare changes that squeeze providers and insurers and discourage unnecessary care -- and trade them for more revenue.  Right now we have the worst of both worlds -- hamstrung domestic discretionary spending, and no move on long-term spending control (other than the possibly very considerable and perhaps even sufficient cost controls kicking in with the ACA).

Again, I suspect that Obama may ultimately get a fig leaf -- small revenues, perhaps topping off to the $800b/ten years he considered "free" -- in exchange for entitlement reform he wants. Indeed,  chained-CPI, on one front an entitlement cut, would get him about halfway there, as it also raises revenue by slowing the adjustment of tax brackets for inflation. Perhaps even Republicans can find a way to toss him another $100 billion dollar bone.

It's small consolation that even Republican political advisers are suggesting that being the party of austerity-only forever isn't politically "sustainable." Holding the House via tax absolutism may be sustainable for a long time yet. And as Jonathan Bernstein, reacting to data from Seth Masket pointing toward limited effects from Democrats' move to the center in the1990s suggests, "at least for presidential elections, GOP extremism is probably a very minor negative for them at most, but it is a big deal when it comes to governing."

No comments:

Post a Comment