With the interim ‘debt ceiling/government shutdown’ agreement reached last week between the Obama administration and the Teaparty-driven US House of Representatives, the real negotiations on deficit cutting—aka Austerity American Style—are about to begin again, now that the Teaparty has retreated on its demand to defund Obamacare.
A committee will now recommend further spending cuts by December 13, with a deadline in January 2014. The next debt ceiling deadline has been pushed even further out, to February 7, 2014. That means the parties will clearly now focus specifically in the coming months just on deficit cutting.
At the center of coming negotiations will be hundreds of billions of dollars in proposed cuts to social security and medicare, in exchange for a longer term debt ceiling extension beyond the November 2014 midterm congressional elections.
In the ‘ mix’ for an agreement may also be big corporate tax cuts in exchange for token, ‘smoke and mirror’ tax loophole closings, as Tax Code legislation moving through Congress comes to a concurrent vote.
Both Obama and the Republicans in the House were agreed last summer, before the Teaparty faction upset the negotiations agenda in September by injecting the Obamacare issue, to proceed toward cutting ‘entitlements’ and seeking Tax Code Overhaul.
With the Teapartyers in temporary retreat, Boehner and the Republicans have now returned to their initial strategy of this past summer of demanding entitlement cuts for a budget deal. And Obama is prepared to meet them half way, already on record to date to cut social security and medicare in his 2014 budget by $630 billion, as well as on record to cut the top corporate tax rate from 35% to 28%.
For my analysis of Obama’s 2014 Budget—which includes hundreds of billions in social security-medicare cuts—listen to my June 5, 2013 radio show, Alternative Visions, commentary at the following url:
See also my June 2013 blog entry and analysis of Obama’s Budget, plus the longer historical piece on US deficit cutting entitled, ‘Austerity American Style’.
It is important for readers to know that neither social security nor medicare are facing a long term financial crisis. A closer look at the 2014 budget and at reports by social security-medicare trustees shows that problems exist for financial of Social Security Disability Insurance (SSDI) within the social security program, but do not the retirement benefits program in social security. Nevertheless, Obama is proposing to cut future social security retirement benefits. Similarly, problems exist with funding for Part D prescription drugs program within medicare, which has never been funded by a tax since its inception in 2005 and under which drug companies are allowed to price gouge everyone on drug costs. But Medicare’s basic hospital and physicians, Part A and Part B, programs are fully funded for the next decade.
For a clarification of the real status of social security and medicare, watch my 35 minute video presentation earlier this year to the Progressive Democrats of America in San Francisco, on this topic. That video is available on my website at:
http://www.kyklosproductions.com/videos.html (note: click on the TV icon that is second from the top, for the PDA presentation).
It is time to get the facts straight, before the hype and lies start to flow once again in the run up to the next deficit cutting-tax cuts for the rich deal that is now on the agenda once again.
Dr. Jack Rasmus
October 21, 2013