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April 23, 2014

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Harry Reid willing to deal on Social Security if the deal is big

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AP Photo/Charles Dharapak

President Barack Obama meets with Republican and Democratic leaders regarding the debt ceiling, Monday, July 11, 2011, in the Cabinet Room of the White House in Washington. From left are, House Minority Leader Nancy Pelosi, House Speaker John Boehner, the president and Senate Majority Leader Harry Reid.

Sen. Harry Reid, who once promised that he’d do everything as majority leader to prevent changes to Social Security, is willing to support changes to the program as part of a "grand bargain" to raise the debt limit.

“I’m only willing to take a look at Medicare and Medicaid if there is a grand bargain...and Social Security is the same,” Reid said Tuesday.

But then Reid acknowledged such a deal is unlikely:

“Grand bargain? Obviously there’s no need to start talking about the grand bargain because it has been trashed by (House Majority Leader Eric) Cantor and (Senate Minority Whip Jon) Kyl, and we haven’t heard any wild applause from anyone else in the Republican Party.”

Reid’s position basically hones a message President Barack Obama delivered Monday: that Democrats will deal on entitlement programs provided there’s a “big” deal on the table.

“If you’re a progressive who cares about the integrity of Social Security and Medicare and Medicaid, and believes that it is part of what makes our country great that we look after our seniors and we look after the most vulnerable, then we have an obligation to make sure that we make those changes that are required to make it sustainable over the long term,” Obama said Monday, urging Democrats -- many of whom don’t want to consider changes that will make cuts to the programs, or raise the age of eligibility. “The reason to do Social Security is to strengthen Social Security to make sure that those benefits are there for seniors.”

But while the president said wouldn’t horse-trade on entitlements for a “30-day or a 60-day or a 90-day or a 180-day temporary stopgap resolution,” Reid's threshold is more demanding: There has to be “more than $4 trillion on the table”, or he’s not willing to deal.

That puts negotiators between a rock and a hard place.

Negotiations between the president and congressional leaders, which resume at the White House this afternoon, don’t seem to be going so well. There’s a lot of ideas being tossed around, but little progress, and every evening, participating lawmakers emerge with more harsh words to throw across the aisle about the other side’s intransigence than indications that the process is moving forward.

Saturday night, House Speaker John Boehner threw a poison pill into the talks when he said that progress seemed untenable, and perhaps negotiators should take up a shorter-term resolution instead, based on the negotiations a group of lawmakers had been having under Vice President Joe Biden.

Those talks -- which, Reid noted, Republicans walked out on -- were aimed at a deal in the neighborhood of $2 billion to $3 billion.

If lawmakers go for a smaller deal, it effectively serves Reid’s interests on entitlements -- Social Security and Medicare won’t be changed if the deal stays small. But if it stays small, he’ll be forced to repeatedly contend with the whole debt ceiling morass.

After Aug. 2 - the day when Treasury Secretary Tim Geithner says the country starts defaulting - there’s still a fiscal 2012 budget to be passed. And a tax deal to be struck. And then another budget, for fiscal 2013, to be passed before the 2012 election.

That’s been Obama’s argument. “If we think it’s hard now, imagine how these guys are going to be thinking six months from now in the middle of election season where they’re all up,” he said Monday.

Still, confidence that the talks will produce a resolution was at such a nadir that senators of both parties have been unveiling alternatives.

On Monday, Senate Budget Committee Chairman Kent Conrad, who hasn’t been participating in the White House debt talks, unveiled a proposal he says can strike a $4 trillion deal without touching Social Security.

Today, Senate Majority Leader Mitch McConnell, who has been at the debt talks table, unveiled a proposal that would let Democrats and the president raise the debt ceiling, but protect Republicans politically from the process.

Under that plan, Congress would pass a “resolution of disapproval” which Obama could then veto, and if Congress failed to override that veto with a two-thirds majority (which it couldn't), Obama would have the right to raise the debt ceiling -- leaving Republicans able to say “hey, we voted against it.”

Reid said Tuesday he wasn’t ready to comment on the proposal, but he was “not going to trash it.”

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  1. There are any number of scare tactics being used on both sides.

    First, failing to raise the debt ceiling should have no impact on *current* SS payments since in theory it is 100% self-supporting until 2017. At that point in time it becomes a budget item as the trust fund bonds start to be redeemed to make up the difference.

    Second, if SS is *not* a budget item, then why is such a big deal being made over it? Of course it is a budget item if it must redeem bonds.

    If the debt ceiling is not raised then the government must choose between making payroll or making loan payments, not to mention Medicare and Medicaid payments. It would probably be forced to make significant layoffs as well. Contrary to what most would have you believe, the number of non-Postal federal employees has grown by over 6% under Obama.(See this fact check from Politifact: http://www.politifact.com/truth-o-meter/... )

    The reason that changes to Social Security helps is that it will increase the current surplus that must be used to buy bonds, increasing the money available to the general budget. And that is why some Democrats and Obama are willing to talk about it with Republicans.

    The tax code must be changed to close the loopholes, especially on monies earned overseas. Even better would be a way to get out from under the WTO and enact reasonable tariffs on imported goods.

  2. boftx...

    Agree with you entirely.
    (Especially your last paragraph.)

    I wish these clowns would think about the impact & angst their games are having on some of our citizens, especially the elderly. Though as you point out, the clowns are using "scare tactics", I don't think those watching the clowns are enjoying the show. These clowns are in the mold of Stephen King's "Pennywise".

  3. Think big boys and girls. It is for the good of the country.

  4. "Think big boys and girls. It is for the good of the country".

    Tell that to the republicans. They're doing it "for the good of all their rich cronies" certainly not for the good of the country.

    PS re boftx comment:
    I agree - scare tactics. And pending on the news show you watch, it is at varying degrees. Some worse than others.

  5. Turrialba,

    You just gave a whole new level of irony to the statement "what's good for GM is good for the country!"

  6. I agree with mred. Serious Soylent Senior Sitizen Sandwiches.

    I'll need tobasco sauce though...

    Seriously, I think I've found the heart of the entire problem....

    The Republicans hate cats!!!!!

    http://debtceilingcat.tumblr.com/

  7. LasVegas2011...
    That was a joke, right?
    Whew! For a minute ther I thought you were serious.

  8. Cutting Social Security and Medicare benefits for low income seniors is the equivalent of throwing grandma under the train. For many there is nothing left to cut. Absurd suggestions from Congress and its budget spin artists have suggested such silly examples as having seniors eat more pork and less beef to save money. With rising medical costs, many seniors are shelling out hundreds of dollars from their low income "paychecks" already, shopping for generics and forgoing most of life's little luxuries, with little likelihood of any improvement in their lifetimes. There are no promotions or Christmas bonuses to fill a budget gap. Means testing seniors with substantial other income may be appropriate, but across-the-board cuts would be devastating.

  9. @oldPSUguy:

    No one is talking about throwing granny under the bus. This is the biggest piece misinformation going. It is about whether we our going to throw our children and grandchildren under the bus.

    Medicare and Social Security is about slowing the growth of benefits to future recipients. Future retirees will not do as well as granny is doing to today on Social Security. Prepare for retirement. However, there will be social security and medicare. The only alternative to reform is insolvency. Program costs and revenues have to line up over the long haul.

  10. A meaningful mega-deal (emphasis on meainingful) will do a great deal to help long-term economic growth in this country. It will be painful, but it will bring some certainty to the financial markets and encourage investment.

    Definition of meaningful--realistic objects and assumptions.

    No deferred pain (the cuts and stuff start pinching sometime in the next decade);

    the growth of entitlements have to be addressed (discretionary spending isn't a big enough part of the budget).

    equitable distribution of pain (loopholes must go in exchange for broader taxes)

    In other word everyone hates the deal, but takes it because it beats the alternative.