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Beware Obama's Dealmaking | The Nation

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George Zornick

George Zornick

Action and dysfunction in the Beltway swamp. E-mail tips to george@thenation.com

Beware Obama's Dealmaking


Barack Obama and House Speaker John Boehner. (AP Photo/Pablo Martinez Monsivais.)

As sequestration churns on, President Obama is reaching out to moderate Republican members of the Senate to see if he can still put a deal together. He is coming to the Hill next week for a Republican luncheon, and hosting other members for dinner tonight. The president is also picking up the phone. “He just called me,” Senator Lindsey Graham told reporters yesterday. “What I see from the president is probably the most encouraging engagement on a big issue that I’ve seen since the early years of his presidency. He wants to do the big deal.”

This should, and does, worry progressives inside and outside of Congress. The default position among center-left pundits is that if Obama gets Republicans to agree on a grand deficit reduction package that includes new revenue, he’s “won.” But that assumption really needs to be interrogated, and each concession examined.

Sequestration is a terrible policy; the cuts will touch a number of vital government functions and inflict unnecessary pain on many Americans. But here’s what Obama is proposing: an unbalanced package of $930 billion in cuts and $580 billion in revenue, with an additional $100 billion in deficit reduction through Chained CPI. This is the formula that would cut Social Security benefits $1,000 per year for some seniors and take $1,400 per year from disabled veterans.

Is that truly better? The sequestration cuts are damaging, but money taken away can always be restored later. (In this case it would involve scrapping the Budget Control Act, which is no doubt more difficult.) Chained CPI, however, permanently cuts the safety net, and that’s much harder to ever undo—and the fact that a Democratic president did it opens the door to even more cuts down the road.

It also presents serious political risks for the Democratic Party. Obama is currently being blamed by Republicans and many in the media for the idea of sequestration, as he was blamed relentlessly during the 2012 campaign for the $700 billion Medicare cuts—both things he ostensibly proposed to appease Republicans. He will almost certainly be blamed for cutting Social Security as well if his plan is enacted.

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A very telling phone call came in to CSPAN’s Washington Journal this morning, during conservative GOP Representative Lynn Westmoreland’s appearance. A Republican caller from West Virginia begged Westmoreland to hold firm on the spending cuts, criticized the idea of government handouts, but then specifically blasted “the chained CPI that the president wants”:

I hope Republicans do the right thing, take care of the people—you know who we are. And I don’t want anything from the government, I’ve been working all my life and so has my entire family, so I hope that you guys stick to your guns, no matter what the cost, and please bring us back from the brink of disaster. And don’t set up that CPI, that chained CPI that the president wants. And would you explain the Chained CPI a little bit?

There’s a reason Republicans haven’t actually staked out and named entitlement cuts they want in this debate. Cutting Social Security is not popular, even among Republicans. You can bet your last dollar they’ll blame Obama for cutting Social Security during the 2014 midterms if his plan passes.

There is, of course, a great deal of doubt that it would ever pass. Even if Republicans agree to a grand deficit reduction package, which at least in the House seems unlikely, Obama still has to deal with Democrats. Note that the Democratic sequester replacement bill in the Senate contained an even split between new revenue and cuts, and no Chained CPI. The AFL-CIO supported it for this reason: “Although it would not repeal sequestration, it would minimize harm to the economy and would not cut Social Security, Medicaid or Medicare benefits.”

In the House, where significant Democrats might be needed to pass any sort of deal with Obama, resistance is strong to benefit cuts as well. The Congressional Progressive Caucus has long opposed them, and today Representatives Alan Grayson and Mark Tanako are asking colleagues to sign a letter pledging to vote against any cuts to the safety net. They are also holding a call with activists via the Progressive Change Campaign Committee.

Grayson predicted this week that “if they go through with cuts, you’ll see people pouring into the streets. Pouring into the streets of Washington, DC, and every other capital, state capital and major city in the country.” That’s probably a bit hyperbolic, but there is significant reason to be worried about Obama’s dealmaking on the sequester.

Barack Obama may be wrong on the sequester deal, but he’s right on his nomination for EPA director, George Zornick writes.

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