As Susie already noted, this release by the co-chairs of President Obama's Catfood Commission that don't look like they have any chance of being approved by the entire panel is nothing but a political ploy designed to warm us up for the "reasonable compromises" we're likely to see proposed next. And the Villagers haven't wasted any time getting started. Here's Gloria Borger and Wolf Blitzer telling us how important it is that this got "the conversation going."
Too bad that "conversation" is a completely dishonest one about what really should be done to take care of our deficit instead of lying about Social Security.
BLITZER: Let's talk about the political realities of this proposal.
We'll bring in our senior political analyst, Gloria Borger -- Gloria, how likely are these proposals going to be to move forward?
It's by no means a done deal.
BORGER: No. And as you pointed out, Wolf, this is a chairman's mark. They wanted to get this out there, to put this on the table. And I think we should give the two chairmen, Alan Simpson and Erskine Bowles, some credit here for putting some really bold, serious ideas on the table.
But it -- but you do need 14 out of 18 members to approve of this in order to get this proposal before the Congress. Given the fact that this has both large spending cuts in it and a change in the tax system, I'm not sure, Wolf, that they can get there. But it's in everyone's interests right now to try and get something before the Congress. So I won't say no. You know, we just don't know at this point.
BLITZER: We're -- we're already, though, hearing loud complaints...
BORGER: Yes.
BLITZER: -- from liberals and from conservatives. I don't think this should be surprising.
BORGER: No, it's not surprising. You know, Wolf, we've been debating these issues for years. They're the same issues. Nancy Pelosi just put out a statement -- I just got it on my BlackBerry -- that called it "simply unacceptable." A lot of the spending caps are going to be unacceptable to Democrats. And the changes in the tax system, particularly eliminating sort of the deductions on mortgage, for example, are going to be unacceptable to Republicans.
But what was interesting to me about looking at this document is there wasn't just one tax option they gave. They gave three different scenarios on the tax front, because it was clear that the chairmen probably couldn't agree on what the tax options should be. And they're giving you a trade-off here. They're saying, if you lose some of your deductions, you're going to get a lower overall tax rate. So say you lose your mortgage interest deduction and you're a wealthy person, your rate is now 39 percent. That -- 39.6 percent -- that would actually drop to 23 percent.
So, again, they're saying to people here, take a look at these. There are trade-offs. This is a very serious problem. We have to deal with it and just don't say no. We have to try and work on this.
BLITZER: For the highest income, right now, it's 36 percent, the rate, under the Bush tax cuts. It would go back up to 39 percent...
BORGER: 39.6...
BLITZER: -- if the...
BORGER: That's right. Sorry.
BLITZER: -- if the Bush tax cuts lapse, it goes back to...
BORGER: That's right.
BLITZER: -- to the tax rates 3.5 percent higher than existed...
BORGER: Right. Sorry.
BLITZER: -- during the Clinton administration. I just want to be precise on that.
BORGER: Right. That's the number they used, by the way, in their -- in their outline, was the 39.6 percent, because, of course, we don't know what's going to happen with that right now.
BLITZER: But -- but Nancy Pelosi and a lot of the liberals...
BORGER: Yes?
BLITZER: -- they don't even want to discuss reducing Social Security benefits.
BORGER: No.
BLITZER: For them, that's a nonstarter.
BORGER: You know, it -- it's interesting, because when you read this very carefully, we've been, again, having this Social Security debate for, what, more than a decade?
And so there aren't that many things that you can do, Wolf.
What's interesting to me here is that these proposals are not really the kind of structural reform that we saw during the Bush years. There's no talk about so-called privatizing Social Security. As you were speaking about before, what they're talking about is raising the retirement rate very gradually. The difference will be that wealthier retirees will get fewer benefits and probably have to pay more in payroll taxes. That may not go over so well.
But what's important here is the money they save on Social Security goes back into Social Security. Liberals have always complained, Wolf, that you save the Social Security money and you put it into deficit reduction, you balance the budget on the backs of the seniors.
And what they're saying here is we're not going to do that. Whatever we save on Social Security goes back into the system to make it solvent.
BLITZER: We'll see if this initial proposal by Erskine Bowles and Alan Simpson...
BORGER: Right.
BLITZER: -- if it gets off the ground, if they get a total of 14 members of their commission on board. We'll see what happens over the next few weeks.
BORGER: It gets the conversation going, Wolf, which is what's important.
BLITZER: And we've just had a little conversation right here, as well.
All right, Gloria.
Thank you.
BORGER: Sure.
