You may recall I recently wrote that there are clear signs that genuine reform lies ahead. This week, President Obama may have underscored that point. He spoke openly about reforming Social Security and Medicare by doing more than raising taxes. Well, if you don’t raise taxes you have to cut the benefits. So this would likely mean the President would go along with cutting benefits.
Is this a ploy? Hard to say. He would like to place himself in the middle, between the left and right. At least for the election, he would. On the left he and we hear Nancy Pelosi boast that she and colleagues fought off attempts to cut benefits. On the right there are those who would totally privatize both programs.
Maybe this attempt by the President to stand between them is election propaganda. Maybe it is more. At least he is talking about reform. He calls it “changes.” If Congress eventually does something more drastic, it would be “reform.”
We must have reform of these big benefit programs. The government has promised $46 trillion more in benefits than it will have money for. That’s like you promising to pay off a $10 million mortgage. When you will earn only $2 million over the next 20 years.
Yes, you might find a better job, more income. Yes, our government may get extra revenue from taxes. But let us be realistic. Your new job and its new revenue are not going to be enough. You have to get out of your mortgage. The government has to re-write Social Security and Medicare. Along with other benefit programs.
What sort of reform are we going to get? That depends upon how Americans vote in this election. Not just because we will decide who lands in the White House. It is the new Congress which will decide much of the question.
A more conservative Congress is more likely to push for deeper reform. That is true no matter who becomes President. A really conservative Congress would likely push for, say, some type of individual accounts for Social Security. A conservative President would likely go along with that idea. That would be genuine reform.
President Obama would probably veto such an idea. He would probably want to keep the system as is. And cut some benefits. And add some taxes. That would represent “changes” rather than true reform.
We may get similar action on our tax code mess. Conservatives would push for flat, simple tax rates. And for doing away with all deductions. That is, doing away with the devices politicians use to reward those that bribe them. A conservative President might go along with that. And that would be major reform.
President Obama would probably veto that. He would probably hold out for something in the middle. Something that included changes, rather than real reform.
So, voters in the election may well decide whether this country achieves real reform in some major areas. (Over 60 percent of our budget is for entitlements.) Or they will decide that we will settle for changes.
This is a fork in the road. Bill Clinton would persuade most of us that he and we could take both routes. Most other politicians will not be so persuasive.
From Tom ... as in Morgan.
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