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Durbin Defaults

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Senator Richard Durbin reverses longstanding positions in his support for the Simpson-Bowles deficit reduction plan spelled out in his op-ed in the Tribune. If a politician's promises can be seen as a contract with the voters who support him, Durbin has defaulted.

(Lacking 14 required 'yes' votes, the commission adjourned without a vote Friday, but Senate Majority Leader Harry Reid promised to hold a floor vote on the commission's package, Talking Points Memo reports.)

As R. J. Eskow at the Campaign for America's Future points out, it was only recently that Durbin spoke out against raising the retirement age for Social Security benefits and insisted the system could achieve long-term stability simply by lifting the cap on payroll deductions.

Eskow cites reports that the White House was pressuring Democrats on the commission to vote 'yes.'

We've noted that raising the retirement age constitutes a 13 percent reduction in benefits. Economist Ron Baiman of the Center for Tax and Budget Accountability puts it in simpler terms: raising the retirement age by one or two years "means we're taking $20,000 or $40,000 away from people who've worked all their lives."

In his op-ed, Durbin touts a "special benefits package" for workers in manual labor jobs.

Here's Eskow's take: "Durbin mentioned the 'hardship' exemption to the increased retirement age, perhaps to blunt criticism, but we won't even know for ten years whether those occupations will qualify for an exemption. The Commission proposal defers that decision, and offers little guidance on which high-stress and high-demand occupations should be exempted."

Paul Krugman points out that this changes Social Security in basic ways. "Right now we have a retirement system that has the great virtue of not being intrusive: Social Security doesn't demand that you prove you need it, doesn't ask about your personal life, doesn't make you feel like a beggar. And now we're going to replace that with a system in which large numbers of Americans have to plead for special dispensation, on the grounds that they're too feeble to work for a living."

Reagan on steroids

Durbin says that with tax rate reductions, "middle-income Americans will enjoy a much-deserved tax cut. " But the plan's tax cuts are weighted to the wealthy (as usual), and offset by the elimination of middle-class deductions. That includes new taxes on employer-paid health care, which Durbin and Obama campaigned against. With the Social Security cuts, it's at best a wash for the middle class.

Perhaps that's why Senator Tom Coburn, the conservative Republican who's also on the commission (and also voted 'yes'), called the commission's tax plan "Reagan on steroids" and said it adheres to the House GOP's "Pledge for America," as Eskow points out.

Two "hidden agenda" items - cutting Social Security and cutting taxes on the wealthy - coming from "longstanding campaigns by corporate-backed conservatives to undermine trust in and ultimately defund democratic government" led to the deficit commission's failure, Dave Johnson of CAF argues. Neither of these items, of course, is any help in cutting deficits.

Perhaps most ludicrously, Durbin brags about pushing the deficit commission to hold off spending cuts until 2013, in order to foster continuing recovery.

"The idea that in 2013 things are going to be better - the reality is, if the public sector doesn't invest, if we don't reduce the trade deficit, things are not going to be better," said Baiman.

Durbin's right that we can't keep paying high levels of debt indefinitely, Baiman says, but the choice is false: we can't get past the current crisis, and bring down the deficit by growing the economy, without higher levels of public debt in the short term.

Where's growth going to come from?

"There's this idea that if we cut debt we're going to restore the nation to a sound economic footing and that will generate growth," he said. "But where's growth going to come from? In the '90s it came from bubbles."

With a huge trade deficit, consumers spending tapped out and businesses waiting for demand to rise, public spending is the only recourse for getting the economy going, Baiman said.

Indeed, the most sustained period of prosperity the nation has seen, following World War II, was founded on significant and sustained public investment.

Durbin touts a $100 billion infrastructure fund, but this is offset by utterly massive budget cuts elsewhere (22 percent of domestic discretionary spending), along with pay freezes and a reduction of the federal workforce by 200,000, which will only add to the ongoing stagnation of middle-class incomes.

Wonkroom at the Center for American Progress cites three progressive proposals to raise revenues that the deficit commission "left on the table": a financial transaction tax, an assessment on big banks, and a carbon tax. Instead there's a regressive 6.5 percent "deficit reduction sales tax."

The long-term deficit is driven by health care costs, where the commission doesn't go beyond the modest savings gained by health care reform. Robert Reich spells out what more is needed: "Let Medicare use its bargaining leverage to get low-cost drugs and supplies [this was an oft-repeated Democratic promise that was bargained away early in the health care reform process]. End health insurer's immunity from antitrust laws. Allow the public to buy health insurance from a Medicare-like public option. And award plans that focus on disease prevention rather than expensive diagnostics and procedures."

Political peril

The commission's report does not represent "the center against ideological extremes," as its proponents claim, Robert Borosage argues. Rather it represents "a developing Beltway consensus" that is opposed by "the vast majority of Americans."

That includes a clear majority of liberals and conservatives who want the government to focus on creating jobs, and the two-thirds of voters, liberal, conservative, Tea Party and other, who oppose cutting Medicare or Social Security - or raising the retirement age.

President Obama is not well-served by Durbin's defection from his principles, Eskow argues.

"Reports indicate that the President is inclined to include many of its recommendations in his next budget. The Administration has been determined to make cost-cutting proposals that affect Social Security, for a long time, according to all indications.

"If the President moves to cut Social Security -- whether it's by cutting benefits, raising the retirement age, or both -- it would be catastrophic: for his presidency, for his party, and for the nation."

With huge margins saying they would vote against politicians who cut Social Security, "nuances about compromise or 'saving Social Security for its own good' will be lost on voters....

"Make no mistake: These cuts will be laid at the feet of President Obama and any Democrat who supports them. There will be no passing the buck."

In his home state, Citizen Action Illinois applauded the 'no' vote from commission member Jan Schakowsky, but said: "We are deeply disappointed that Senator Durbin, by supporting the proposal, chose to set a bar for deficit reform in a way that cuts to the heart of our progressive values." They remain hopeful, however: "We firmly believe that he will fight for those values in the U.S. Senate as this debate moves forward, and we stand ready to work with our senior senator."

They may be on to something: John Nichols reports at the Nation that Durbin has said he would oppose many of the commission's specific proposals. Perhaps the senator could spell this out in another op-ed.

Call home, Dick Durbin!

For a report on alternative plans see Newstips - Alternatives to Austerity.