Obama’s offer to cut Social Security spending

What happened

President Obama this week unveiled a detailed, 10-year budget proposal that for the first time would include cuts in Social Security spending, in an attempt to woo congressional Republicans back to the negotiating table on a “grand bargain.” Obama proposed cutting $930 billion in planned spending on domestic programs and entitlements, while raising $580 billion in new revenue through the “Buffett” tax requiring millionaires to pay a minimum tax rate of 30 percent, higher taxes on tobacco, and capping tax breaks for the wealthy. The budget would cut Social Security by $230 billion over 10 years by using a different formula, called “chained CPI,” to make future cost-of-living adjustments to benefits and tax brackets. Obama said his budget would reduce the deficit by $1.8 trillion over 10 years, and could therefore replace the $1.2 trillion sequestration cuts to military and domestic spending that have begun to go into effect. “I am willing to make tough choices that may not be popular within my own party,” he said, “because there can be no sacred cows for either party.”

House Speaker John Boehner immediately dismissed Obama’s budget, saying “modest entitlement savings” should not be held “hostage for more tax hikes.” But some Republicans welcomed the president’s proposals as the first step toward a broad deficit-reduction deal. Sen. Lindsey Graham of South Carolina praised the president for “showing a bit of leg.”

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What the editorials said

Social Security cuts are a “bad idea,” said The New York Times. Retirees will be more heavily dependent on the program in coming years, since traditional pensions no longer exist and few people have adequate 401(k)s. It’s no surprise that “the Left is outraged” at any hint of entitlement cuts, said the Financial Times, but this is exactly the sort of compromise needed for long-term fiscal reform. An agreement to reduce deficit spending would remove the “persistent question mark hanging over the U.S. recovery.”

Thanks, but no thanks, said NationalReview.com. This calculated “feint at a grand bargain” is just more of the same Obamanomics, a supposed “compromise” of higher taxes and gimmicky spending cuts that would nullify $1.2 trillion in sequestration cuts. He even includes a brand-new universal pre-K program, whose $77 billion cost would be funded by nearly doubling the federal cigarette tax to $1.95 a pack. The budget’s only purpose is “to generate press coverage about how reasonable the president is.”

What the columnists said

Obama has been reasonable all along, said Jonathan Chait in NYMag.com, though Republicans have refused to admit it. Obama’s new budget offers the same entitlement cuts and modest tax increases that he’s been offering since 2011, and that Republicans have repeatedly rejected for the simple reason that they “hate his ideas and hate him.” Putting his previous offers into a budget document is simply a “message strategy” to convince the Washington establishment that “Obama Is Serious.” Nonetheless, his offer to cut Social Security is a mistake, said Kevin Drum in MotherJones.com.Republicans will treat Obama’s triangulation as a “new baseline to negotiate down from,” while continuing to reject all new taxes.

As a “starting point for negotiations,” this budget is a welcome first step, said Michael Tanner in NationalReview.com.Putting entitlement reform on the table is “not an easy thing for a Democrat to do,” and we should credit the president with finally recognizing that we’re on the road to fiscal crisis. This budget does little to solve it, of course, but “the longest journey starts with a single step.”

So will Republicans return to the negotiating table to talk grand bargain? said Ezra Klein in WashingtonPost.com. At this point, they’re “out of excuses.” They can’t convincingly say Obama isn’t willing to meet them halfway, as chained CPI was actually their idea. And as the sequester begins to bite into unemployment checks, Medicare reimbursements, and national park hours, outraged calls for a balanced deal to replace it will only get louder. The White House has called the Republicans’ bluff. “The question now is whether, as the pressure mounts, they double down against compromise, or they begin to fold.”