[lbo-talk] NYTimes: Obama Promises Bid to Overhaul Retiree Spending

Shane Taylor shane.taylor at verizon.net
Thu Jan 8 10:45:13 PST 2009


Mark Rickling wrote:


> Dean Baker thinks it might not be this bad. Let's hope he's right.

Indeed, though Obama said:


> We will -- we are working currently on our budget plans. We are
> beginning consultations with members of Congress around how we
> expect to approach the deficit. We expect that discussion around
> entitlements will be a part, a central part, of those plans. And
> I would expect that by February, in line with the announcement
> of at least a rough budget outline, that we will have more to say
> about how we're going to approach entitlement spending, how we're
> going to approach eliminating waste in government, one of Nancy's
> tasks.
>
> So we will have some very specific outlines in terms of how it's
> going to be done.

Above, Obama isn't speaking in terms of health care, but of entitlements. The former would echo Dean Baker and the Center on Budget and Policy Priorities, but the latter sounds like Peter G. Peterson, the entitlement vulture. As Dean has said previously, speaking of Social-Security-Medicare has been a disenginuous way of using the rise in health care costs to go after Social Security.

But why would Obama even consider resurrecting those debates now? Well, you can't send a meaningful signal without it costing you something. If Obama wants to signal to the elite that he is serious about deficit reductions in the future, perhaps the signal they are most eager to heed is some sacrifice in entitlements. How else can he reconcile deficit reduction in a couple of years with enlarging the military and cutting taxes? Although he has emphasized cost reductions to sell his health care reform, that doesn't necessarily mean he will make health care reform the "central part" of deficit reduction. But Dean is right that something like that should be the measure of the "specific outlines" to come.

Shane



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