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UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who covered Washington during all or part of ten of America's presidencies and who has edited alternative journals since 1964. The Review, which has been on the web since 1995, is now published from Freeport, Maine. We get over 5 million article visits a year. See prorev.com for full contents of our site

February 5, 2010

THE MARCH OF THE MEDICARE - SOCIAL SECURITY WRECKERS

Robert Kuttner, Prospect - Fiscal conservatives in Congress hope to hold recovery spending hostage for long-term caps on social outlay, and they have some company in the White House. Groups like the billion-dollar Peter G. Peterson Foundation are leading the charge.

For a quarter-century, Peterson has been exaggerating long-term costs of Social Security and Medicare. In truth, Social Security is close to balance -- its 75-year projected deficit is just one-half of 1 percent of gross domestic product. Medicare is seriously in deficit, but reform of Medicare consistent with high-quality health care depends on tackling the deeper drivers of medical inflation.

But for those inclined to cut social insurance, the recession--driven deficit is a godsend because it lends credence both to the alarmism and to extreme remedies. Sen. Kent Conrad, a Democrat from North Dakota, and Sen. Judd Gregg, a Republican from New Hampshire, are promoting a fast-track commission with extraordinary powers to cap federal spending, a long-standing Peterson project. The commission would make recommendations that Congress must vote up or down with little debate or opportunity to amend.

The flaws in this idea are both procedural and substantive. The Constitution vests the power of the purse in a democratically elected Congress, not in an elite body insulated from public deliberation and debate. Substantively, the commission's sponsors want it to recommend the sort of cuts in Social Security and Medicare that would never be approved through the normal legislative process. Some say new taxes could be on the table, but the commission's Republican backers insist tax increases would be dead on arrival. So the lowest common denominator would be deep cuts in social insurance.

Given the opposition of key House and Senate leaders, Conrad-Gregg may not get through Congress. But the Obama administration, looking for "cover" to offset short-term spending increases, now supports some version of the idea. This is a huge mistake; it reinforces the misplaced obsession with deficits as well as the self--fulfilling prophesy that such a commission is both desirable and inevitable.


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