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From "Change You Can Believe In" to "Eat Your Peas": Obama Prepared to Cut Social Security, Medicare and Medicaid

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In my Huffington Post article this past weekend I asked, "Will Obama Be the First Democratic President to Cut Social Security, Medicare and Medicaid?"

Since then, things have gone from bad to worse. With Republicans drawing more lines in the sand against closing a single tax loophole, Obama responded in his Monday press conference by offering up even bigger concessions on key Democratic values, specifically putting cuts to Social Security, Medicare and Medicaid on the table.

Here are some of the most disturbing quotes from Obama's Press Conference (with credit to Adam Green of Progressive Change Campaign Committee for pointing them out):

We're going to have a sales job. This is not pleasant. It's hard to persuade people to do the hard stuff that entails trimming benefits and increasing revenues.

Interpretation: For the first time, Obama specifically called for cutting benefits to seniors, the poor and the disabled who receive Social Security, Medicare and Medicaid, in exchange for some unnamed concessions by Republicans to close some tax loopholes. Couple this with reports in the New York Times and the Huffington Post that Obama has offered to increase the Medicare eligibility age from 65 to 67 and reduce Social Security cost of living increases so that over a decade benefits would decline by as much a $1,000 a year, and you have the biggest potential betrayal of core Democratic values since Bill Clinton repealed New Deal regulation of banks and the financial industry.

With respect to Social Security, Social Security, Social Security is not the source of our deficit problems...The reason to include that potentially in this package is if you're going to take a bunch of tough votes, you might as well do it now, as opposed to trying to muster the political will to get something done further down in the future.

Interpretation: WTF? A Democratic president saying we need to cut Social Security benefits? This, even though by Obama's own admission, Social Security has nothing to do with the deficit? If Obama really believes cutting Social Security benefits is necessary in the near future -- as opposed, say, to increasing the income cap on which Social Security is taxed -- then he's all but forfeited the right to call himself a Democrat.

I want to be crystal clear--Nobody has talked about increasing taxes now. Nobody has talked about increases--increasing taxes next year.

Interpretation: If Obama strikes a deal with Republicans, massive domestic spending cuts on vital programs like student loans and community health centers will take place immediately while even closing loopholes for the richest Americans will be put off several years into the future.

Some additional observations:

1. Obama continues his pattern of preemptively offering major concessions to Republicans and when they refuse those concessions, offering more concessions without getting anything in return.

2. This is both bad policy and bad politics. On a policy level, Obama has adopted the wrong-headed Republican idea that with 9.2% unemployment, the solution to the economy is austerity and spending cuts, not stimulus and job creation. He echoes Republican talking points that the reason businesses are sitting on nearly $2 trillion in cash, instead of creating jobs, is that they're not confident that government spending will be cut, rather than that there's insufficient demand.

3. On a political level, while Obama's call to "eat your peas" may please the pundit class, it flies directly in the face of a majority of voters. In a just released Pew poll, by a 2-1 margin (60%-32%) respondents believe it's more important to keep Social Security and Medicare as they are than to take steps to reduce the budget deficit. 61% think people on Medicare are already paying enough of their healthcare costs and only 31% think beneficiaries should pay more. By 58%-37% respondents support maintaining current levels of Medicaid eligibility, rather than letting states cut them back. Yet Obama and his political advisors seem to believe that the key to his reelection is being seen as the grand compromiser, rather than standing up for the essential programs which support the middle class and which a large majority of voters cherish.

4. Obama's support for raising the Medicare eligibility age from 65-67 is particularly pernicious. Already, there are numerous Americans in their 50's and 60's who don't get health insurance from their jobs, and either can't afford private insurance or are disqualified because of pre-existing conditions. They often wait to seek care until they qualify for Medicare. As Paul Krugmanhas pointed out, postponing the eligibility age for Medicare is not only cruel, but may actually increase costs because by the time a 67 year old reaches Medicare age, s/he may have developed conditions that could have been treated inexpensively earlier but now require expensive care. As I argued in The Huffington Post several months ago, there is a long-term problem with medical inflation increasing the cost of Medicare to unsustainable levels. But the long-term solution is not to raise the eligibility age of Medicare, but to join the rest of the advanced capitalist world in extending Medicare to all Americans. Obama's proposal goes in exactly the wrong direction.

5. Even if Obama actually believes the conservative beltway theory that a "grand bargain" to cut trillions in spending, close tax loopholes to a much lesser degree, lower tax rates in exchange for reducing exemptions, and cut Social Security/Medicare/Medicaid is a good idea, the notion that such a "grand bargain" could be struck in the next 9 days is a political absurdity.

In the meantime, if you oppose President Obama's overtures to cut Social Security/Medicare/Medicaid, go here to sign the Progressive Change Campaign Committee's petition stating:

"President Obama: If you cut Social Security, Medicare, or Medicaid benefits for me, my family, or families like mine, don't ask for a penny of my money or an hour of my time in 2012. I'm going to focus on electing bold progressive candidates who will fight to protect our Democratic legacy."

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