I think this is right, reading tea leaves from Obama as well.

I do think folks need to be honest that Medicare reform doesn't completely match up with health system reform: end-of-life care is an issue that is almost exclusively a Medicare issue-- one that drives a significant portion of Medicare costs (20-30%), and is pretty distinct, policy wise, from other health system reform questions.

So are you calling Jane Hamsher shrill?

I assume all the Repukes and Blue Dogs will oppose the huge increase in DOD spending...

I am happy that Orszag is correctly focusing on healthcare, however the Orszag-Diamond proposal is not embraced by this liberal.

Various liberal economists, among them Brad Delong and O&D, think solving the potential problem out on the 75-100 year horizon will quiet the critics. This is stupid. Fox News and others of that ilk are hammering away at the near term shrinking payroll tax surplus that must be compensated for with increasing income tax revenue.

The bottom line is conservatives do not want to repay the trust fund. Efforts such as the O-D plan completely miss the salient political point.

The task force can begin by acknowledging the huge (15.3%) tax burden the payroll tax imposes on labor. To that end, both Social Security and Medicare should be limited to those who paid into the system and worked sufficient quarters to qualify for benefits.

Programs such as SSI and Medicaid are worthy, but should be supported via general income tax revenues, not a regressive tax on labor.

I'm with Nat - Diamond-Orszag may have been (far) better than anything the Beltway wanted, but the only proper response to talk of "fixing" Social Security is to ask if every other shortfall of the next 75 years has been fixed first.

At any rate, Obama needs to know that, if he so much as touches Social Security*, he will hear massive outcry from liberals. Blue Dogs need to know that, if they try to fuck with SS, they will be targeted in primaries.

* without, I suppose FIRST securing extraordinary concessions on UHC and a more progressive tax structure

The proper response to Peterson and his ilk is contempt.
And given Obama's dubious performance on progressive issues to date, a "mighty din" might well be called for. After all, there some pretty dubious characters in his entourage.

I'm afraid. The Diamond-Orszag proposal uses lots of language to muddy the water, but it does advocate for raising the eligibility age and lowering the payments for SS, while simultaneously upping the amount everyone pays into the system. This will be particularly tough on self-employed folks (like myself) who pay the full share of SS tax, currently around 12.8% I think, on top of our income taxes and everything else. The proposal talks about raising that amount substantially.

Thank you. I can't tell you how annoying I find it that the moment the word "entitlement" comes out of ANY Obama Admin person's mouth, the Left start sharpening their knives and spouting off about one-term presidencies. Chill, y'all. There's really nothing in Obama or Obama's team's history to suggest he has any intention of gutting Social Security. Quite the contrary.

Is it so hard to hold in our brains the concept that "reform" can mean all kinds of good things? Medicare and Medicaid ARE in trouble because of ballooning costs. We WANT to reform them, i.e., reform our health care system. Sheesh.

I am not worried by Orszag or Furman, but the administration also employs Jeffrey
Liebman, who was the coauthor with Repulicans Maya MacGuineas and Andrew Samwick of a "Social Security Reform" package which includes private accounts. http://www.hks.harvard.edu/news-events/publications/

Reading through Orszag-Diamond, it's hard to see much difference from what Bush was trying to do four years ago. It increases taxes unfairly on everyone except the wealthy, lowers benefits to those who need them most, and sets Social Security on a path to extinction. If that's the opening Obama position, like the stimulus package in our hyper-partisan political culture, it's a crappy opening proposal from the perspective of working Americans.

NealB: I honestly cannot for the life of me understand how you came to that conclusion by reading their plan.

The deal is gonna be UHC for the SSTF. They'll call moving SS to Pay-Go "fiscal responsibility".

Now with some tweaks, we really don't need the trust fund, but it will mean the final ripoff of workingclass baby boomers for trillions of dollars. Ezra don't like those hippies anyway.

And what, when Obama puts it to Congress, y'all gonna turn him into a lameduck loser?

Ezra,

You seem blinded, at least in part, by your positive opinion of Orszag. We know he "gets" healthcare and thats good. But if I recall correctly the grand "Orszag-Diamond proposal" is far from a very liberal defense of Social Security. Rather, it posits significant alterations to the program that are unnecessary and potentially regressive.

I think you are confusing your readers by positing the "proposal" as the liberal riposte to the Pete Peterson/Bush plan. Among the Brookings crowd, invertebrate Congress folks, and assorted Washingtonians, it may been effecting. But most Americans and truly "liberal" supporters of social security and the American social compact would disagree.

Contra your breathless attachment to Orszag's social security boosting, Jamie Galbraith - who I think is a wee more befitting of the "liberal" moniker - supports the exact opposite of the "plan."

In DC, often times what is "liberal" - from clintonism an neoliberalism - is far from it. Thus Orszag is squarely in the "liberal" camp spawned by Rubin and Brookings, but I dont count them as allies.

Linda: Medicaid and SSI (which is Medicaid plus a small cash payment) are part of the general fund and are not funded by payroll taxes. SSI is means tested, meaning you have to be poor as well as disabled.

Disability is part of Old Age, Survivors, and Disability Insurance (OASDI) which is the correct name for that grab bag of programs we call Social Security. If you have worked 40 quarters and are disabled, you get SS Disability, not SSI. The kick in the teeth is you have to wait 2 years for Medicare, plus the SS check is pretty much guaranteed to be to high for you to qualify for SSI so you lose your Medicaid. Nice system we have here, eh?

I guess it is possible to make the case the since SS runs a multi-billion dollar surplus every year that it indirectly funds Medicaid, but that is not an argument that I would hang my hat on.

The acceptable outcome on entitlements:

1. No cuts in Social Security at all

2. Expand Medicare to Medicare for All. Single payer would save $350 billion a year; through the miracle of compounding, that number gets even better the farther out you go.

Yeah, a lot of campaign contributors and Village insiders will scream. And?

Much better discussion of Social Security over at Angry Bear, Bruce Webb is spot on. Keep your hands off Social Security, it's fine, and doesn't need any frigging "reform".

The Medicare crisis is the SS crisis on steroids. The SS crisis is simple to fix: remove the cap on SS taxable income, and you can actually reduce the SS tax rate. The rich pay more, everyone else pays less and SS is safe for 50 years.

Medicare adds the same problems, plus 15% inflation. Add to that the death of our private payer plan and we really need to turn the system upside down. A single payer plan is the only solution, and allow employers to supply supplemental plans, like dental and chiropractic, as part of their benefits packages.

I seriously doubt anyone will consider privatizing SS after last fall. Can you imagine if Bush had succeeded and millions of senior citizens just saw their SS lose 50% of its value in 3 months along with the value of their homes and the value of their Wall Street portfolio? AARP would be demanding we nationalize the Stock Market if that every happened!

The real problem is the entire health care system and Medicare reform should be done in tandem with that. Some change in social secuirity probably is necessary, but that should be minimal-just increasing the age for full benefits slightly over time and, I think, replacing the payroll tax with a carbon tax in the amount necessary to then fund the system.

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