Washington, DC felt like a city on a deathwatch this week, after a series of White House news leaks said the president would announce cuts to Medicare and Social Security benefits next Monday.
One plan was to raise the eligibility age for Medicare and Social Security. Another involved an accounting gimmick that would cut the already-inadequate cost of living adjustments for Social Security benefits -- and raise taxes on the middle class, too.
The response was negative, as most people might expect. Very, very negative.
Ever since these trial balloons were first floated, many elected Democrats have been dreading next Monday's speech. They saw these proposals as a fatal blow to their reelection chances.
Another dark cloud was hanging over public interest groups who represent older Americans, sound economic policy, or improvements to our health care system. They understood the damage these ideas could cause.
That was then, this is now. Today the clouds lifted... some of them, anyway.
Today's leak, as reported in the Wall Street Journal and many other outlets, cites "people familiar with the discussions" who now say Monday's deficit reduction proposal "will leave out changes to Social Security" and "may" -- note the use of that word, "may" -- "may exclude any increase in the Medicare eligibility age."
Those "discussions" are internal White House deliberations, which means the "people familiar with them" are on the President's staff. That makes these leaks real and official, and they bring good news about Social Security.
Political and advocacy groups have been making their feelings known to the White House, and they deserve credit for the change in plans. So does the president, who was open-minded and flexible enough to see the wisdom in their arguments.
That's the good news.
What's left (isn't "left")
What's left to fix in Monday's speech? There's still that word "may" in those comments from his staff. The decision to protect Social Security is a smart one, but if the president goes ahead with his plan to raise the Medicare age it will still be a political and policy disaster. The blowback won't come from the "left," as Washington insiders might think, but from voters all across the political spectrum.
Remember, 51% of Republicans wanted the public option, which was a way of making Medicare available to all Americans. And they were right. This country is being strangled by runaway health care costs. The solution to that problem is making Medicare available to more people, not less.
A plan for insurance companies (and those who love them)
We've already listed eight reasons why raising the Medicare age is a truly terrible idea -- possibly the worst in a season of terrible policy ideas. Where did it come from? One likely source is the health insurance industry, which is giving it as warm a public reception as it possibly can without killing it.
Why wouldn't they like it? It would hand them millions of new customers, just as they were handed millions of new customers when the public option was scrapped from a bill that required people to purchase insurance products.
This idea found two Senators to propose it: Conservative Republican Tom Coburn of Oklahoma, and conservative (non) Democrat Joe Lieberman, the insurance-friendly Senator from Connecticut.
If the president proposes this Coburn/Lieberman idea on Monday, he'll be offering the insurance industry a bonanza while infuriating seniors -- and pretty much everybody else, too.
The deficit that dare not speak its name
That's not to say we don't have a long-term deficit problem, or that Medicare isn't a huge part of it. It's the biggest part of it, in fact, as this chart clearly shows:
This chart shows that we can't afford to let profiteers make millions off our elderly and sick populations any longer. The real "deficit hawks," as opposed to the phonies, are the people who understand this. It can't be fed by taking more from the pockets of older Americans. We have a systemic problem that requires systemic solutions.
The president should reject the Coburn-Lieberman-insurance industry proposal, and use this as an opportunity to demand that his opponents address the real source of our long-term spending problem: runaway profits for drug companies, insurance companies, and for-profit medical providers.
Just Say No to Drug Manufacturers
There are several steps that can be taken immediately, and reports suggest the president is seriously considering one of them. They say he'll propose letting Medicare use its buying power to negotiate discount prices with the drug companies, which it should have been allowed to do all along. That's a smart move that would save hundreds of billions of dollars from the Federal budget.
It would also save money for America's seniors by lowering their out-of-pocket costs. That, in turn, would have an immediate stimulus effect by freeing up billions of dollars, which seniors will then spend on goods and services. That means more jobs.
What a three-fer: Cut the deficit, help our seniors, and create a no-cost economic stimulus at the same time! Anybody who doesn't support that idea has lost the right to be called a "deficit hawk," and must instead be called a "pro-drug company politician."
We can do other creative things to address Medicare costs. Medical students, like other young people, graduate with unprecedented and onerous levels of debt. Why not implement a debt-forgiveness program for young physicians who agree to dedicate a certain percentage of their work to providing Medicare services for which there is a shortage of doctors?
We need more studies on which forms of treatment really work, and which force patients to endure needless suffering while driving up costs. The Dartmouth Atlas and other studies show that many surgeries are unnecessary -- and extremely costly. We're not talking about "death panels." We're talking about making sure nobody cuts you open unless it's going to help you.
That's only common sense. It's how the British and Canadians do it. For all the scare talk, one fact is inescapable: Their health plans are much cheaper than ours. And the only plan in this country that approaches theirs in public approval is... Medicare.
As the distinguished physician and policy expert Ezekiel Emanuel pointed out (yes, he's Rahm's brother): "Cost-shifting cuts don't actually reduce health care spending; they just shift costs from the government to the private sector." If you do that enough, with foolishly-designed industry giveaways like raising the Medicare age, you'll create even more economic chaos and doom seniors to a life of poverty.
The president should be commended for deciding against unwise moves against Social Security. Now he has an opportunity to defend Medicare, too, and to propose deficit solutions that really work -- while making things better for everyone.
Today they're saying the president's plan "may exclude any increase in the Medicare eligibility age." It's time to turn that "may" into a "will." It's time to say he will exclude that increase, and that we have the political "will" to fix our real Medicare problem: