President Obama's jobs speech was pretty good for the most part except when he brought up the part about reforms to Medicare and Medicaid: I'm not sure if this article in FT (which is behind firewall) is accurate, but if it is then I'm getting very nervous and so is the Democratic party. Obama to propose Medicare and Medicaid cuts:
Barack Obama is expected to lay out a plan next week that would cut several hundred billion dollars from Medicare and Medicaid, the large government healthcare schemes for the elderly and the poor, as part of a pitch to cut future deficits by more than $1,500bn. Senior White House officials said the US president would base a detailed blueprint for fiscal reform, which is to be delivered on Monday, on an earlier speech he delivered in April on deficit reduction..
The announcement could create tensions within the Democratic party, which has traditionally staunchly defended Medicare. Mr Obama’s fiscal proposal will be released just one week after the president unveiled a separate plan to raise more than $450bn to pay for a jobs bill that senior officials said would be the president’s singular focus in coming weeks.
The NY Times writes: Democrats See Perils on Path to Health Cuts
As Congress opens a politically charged exploration of ways to pare the deficit, President Obama is expected to seek hundreds of billions of dollars in savings in Medicare and Medicaid, delighting Republicans and dismaying many Democrats who fear that his proposals will become a starting point for bigger cuts in the popular health programs.
The president made clear his intentions in his speech to a joint session of Congress last week when, setting forth a plan to create jobs and revive the economy, he said he disagreed with members of his party “who don’t think we should make any changes at all to Medicare and Medicaid.”
Few Democrats fit that description. But many say that if, as expected, Mr. Obama next week proposes $300 billion to $500 billion of savings over 10 years in entitlement programs, he will provide political cover for a new bipartisan Congressional committee to cut just as much or more.
And, they say, such proposals from the White House will hamstring Democrats who had been hoping to employ Medicare as a potent issue against Republicans in 2012 campaigns after many Congressional Republicans backed a budget that would have substantially altered Medicare by providing future beneficiaries with a subsidy to enroll in private health care plans.
Representative Emanuel Cleaver II, Democrat of Missouri and chairman of the Congressional Black Caucus, said: “Ninety-eight percent of the president’s speech was excellent. The Democratic caucus and the black caucus are fired up. But you will find that we have some differences with the president’s plan as it relates to Medicare and Medicaid. We would rather see some kind of increase in revenue as opposed to cutting these programs.”
By offering such proposals, Mr. Cleaver said, the president “cancels out any bludgeoning that Democrats might give the Republicans over Medicare and Medicaid.”
This grand bargain fetish while pleasing to the Villagers will haunt him and the rest of the Democratic party in 2012 if they actually go through with it.
A new poll by Bloomberg bares this out:
Support for one of the party’s central tenets is declining, with just 34 percent of the country now favoring repeal of President Barack Obama’s health-care overhaul, down from 41 percent six months ago. Republicans support repeal, while political independents and Democrats don’t. A 51 percent majority says a special congressional committee considering how to reduce the federal deficit by $1.5 trillion should opt to raise taxes on higher-income earners before curbing entitlements such as Medicare or Social Security, rejecting Republican pledges against tax increases. Almost six of 10 say the panel must do one or the other to meet its deficit-cutting goal. “Taxes are at the heart of the controversy because Americans hold two conflicting views,” said J. Ann Selzer, president of Selzer & Co. “In the abstract, they’d rather cut than raise taxes. But in the context of near-term goals to cut the deficit, they prefer raising taxes to cutting entitlements.”
And Republican ideas are dropping like a rock:
Rejecting Republican Plans---Majorities reject many specifics of Republicans’ long-term plan to balance the budget. More than three-quarters oppose cuts to Medicaid, the federal-state health-insurance program for the poor, and almost 6 of 10 reject replacing the Medicare plan for the elderly with a private voucher system. A 54 percent majority would raise taxes on families earning more than $250,000 per year, a measure that Republican leaders oppose.
As Digby notes, there's a little chatter out there that some Democrats are being softened up for reasons I don't understand, but it should be a complete non-starter for any Democratic president. It's pure folly. The Democrats seized momentum from the passing of Paul Ryan's Medicare Destruction Plan. Aren't they getting the message that these trial balloons are a flop? All the polls say the same things. Don't cut benefits and really, there isn't any reason to. We have a revenue problem, not an austerity or tax problems.
Let's wait and see shall we?
UPDATE: Carville has the right idea. I've been terribly angry with the WH's strategy for a long time and have written about it just as long.
1. Fire somebody. No -- fire a lot of people. This may be news to you but this is not going well. For precedent, see Russian Army 64th division at Stalingrad. There were enough deaths at Stalingrad to make the entire tea party collectively orgasm. Mr. President, your hinge of fate must turn. Bill Clinton fired many people in 1994 and took a lot of heat for it. Reagan fired most of his campaign staff in 1980. Republicans historically fired their own speaker, Newt Gingrich. Bush fired Defense Secretary Donald Rumsfeld. For God's sake, why are we still looking at the same political and economic advisers that got us into this mess? It's not working.
Furthermore, it's not going to work with the same team, the same strategy and the same excuses. I know economic analysts are smart -- some work 17-hour days. It's time to show them the exit. Wake up -- show us you are doing something.
2. Indict people. There are certain people in American finance who haven't been held responsible for utterly ruining the economic fabric of our country. Demand from the attorney general a clear status of the state of investigation concerning these extraordinary injustices imposed upon the American people. I know Attorney General Eric Holder is a close friend of yours, but if his explanations aren't good, fire him too. Demand answers to why no one has been indicted.
Mr. President, people are livid. Tell people that you, too, are angry and sickened by the irresponsible actions on Wall Street that caused so much suffering. Do not accept excuses. Demand action now.
3. Make a case like a Democrat. While we are going along with the Republican austerity garbage, who is making the case against it? It's not the Democrats!
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