WHERE IS THE PROGRESSIVE LONG-TERM BUDGET FOR AMERICA?
By Kevin A. Stoda
Last week two recommendations were made on how to handle long-term budget troubles in the USA. One was a duo appointed by Obama. These were Erskine Bowles and Alan Simpson--both longterm Washington insiders. They proposed (1) raising the retirement age for Social Security to 69 by the year 2075, (2) decreasing the cost of living benefits for Social Security recipients, (3) imposing new limits on the Medicare health insurance program, and (4) ending several middle-class tax breaks.
A less-talked about proposal was certainly more sane. This was the proposal from the Peterson-Pew Commission--and is referred to by Robert Kuttner on his slashing of the Bowles-Simpson proposal in a radio interview recently..
The Peterson-Pew Proposal would require the government branches to work together on long term budgets and keep them within spending bands and targets--ones that can be negotiated through times of catastrophe and times of abundance. (However, this sort of proposal does not include a solid set of progressive prerogatives.)
Robert Kuttner stated, concerning the ridiculous and anti-American anti-Progressive Bowles and Simpson proposal, that Bowles had no business what-so-ever not recusing himself from being on such an important committee: Bowle i s "on the board of directors on one of the top five banks that would actually be taxed if you taxed financial speculation. . . .. I mean, if Obama had put, you know, Rich Trumka as one of the two co-chairs, the right would be screaming bloody murder, and so would Wall Street. And yet, Wall Street got one of its people, not as the Republican co-chair, but as the Democrat co-chair."
Robert Kuttner noted in his Democracy Now interview last week, " Well, the only thing worse than the economics [of the Bowles-Simpson proposal] is the politics. The economics are totally perverse. Bowles talks about being on a path to an economic crisis. Of course, we're in an economic crisis. We're in a prolonged recession that bears more resemblance really to a depression. And you cannot get out of a depression by austerity. The idea that you should have an arbitrary set of cuts in the deficit at a time when you need more public spending is totally perverse. It's the economics of Herbert Hoover. It's the politics of the Republican right. And it's one more indication of the capture of the Obama administration by Wall Street.
Kuttner, a cofounder of The American Prospect noted, "I mean, Erskine Bowles gets over $300,000 a year for attending a few meetings of Morgan Stanley, the investment bank, on whose board he sits, so he gets more money in board fees than 99 percent of Americans earn. And you've got three privately funded commissions by the Peterson Foundation, Pete Peterson, proposing the same stuff. It's intended to create a drumbeat to carry out a wish list that has long been the goal of fiscal conservatives, that has nothing to do with this crisis. Social Security is in surplus for the next 27 years. So, the idea that you can somehow get the budget closer to balance by cutting Social Security is perverse. It's politically insane."
THE RISK FOR ALL OF AMERICA
Turning towards Obama's hand in this matter, Kuttner added, "And if the President had the kind of spine that we hoped he had when we elected him, he would be saying, "No way are we going to balance the budget on the backs of working people.' Instead, I think the risk is that the President is going to embrace some version of this. And the hope is that the four progressives on the commission, three of whom have already said "no way," plus Max Baucus, the chair of the Senate Finance Committee who's on the commission, will view this as a threat to his prerogatives as a Senate committee chairman. The best thing about this commission is that maybe it will deadlock."
Good congressmen and senators need to respond as Kuttner outlined, " I think the hope is that the Republicans, some of them, will say, "Well, nothing that reduces defense spending or reduces tax loopholes are we going to support,' and the liberals on the commission will hang tough and say, "No way are we going to cut Social Security and Medicare.'"
Then the Bowles and Simpson proposal will be tossed.
However, the bottom line for progressives should be: WHERE IS OUR LONG-TERM AND SHORT-TERM BUDGET PROPOSALS?"
Kuttner noted, "So I think the only thing that's going to block this [crazy Bowles-Simpson Proposal]--and we heard some of this from Rich Trumka--the progressive movement needs to put forward its own version of a budget that would cut defense spending, cut tax loopholes, insist on suspending the Bush tax cuts for the wealthy, and dramatically increase social investment, and explain to the American people why that's a better route out of the real crisis that we're in. There's one resource I want to commend to all of your viewers and listeners. It's a new website, ourfiscalfuture.org, which proposes a counter-strategy for getting the economy out of this mess. That's a coalition of progressive think tanks--Demos, where I'm a fellow, Economic Policy Institute, Century Foundation. And we have a huge fight on our hands, because the other side is investing tens of millions, if not hundreds of millions, of dollars in a propaganda effort on behalf of austerity. It's backed by Wall Street. And all we can do is try and argue that this whole set of proposals is bad economics and bad politics for the Obama administration and the Democrats."
Let's set a one-week deadline and get a progressive proposal on the table pronto.