Just caught Krugman's post tonight about what Ezra guesses or hints may be the current state of the fiscal curb negotiations. According to Ezra the Republicans concede to a 37% top rate (not 39.6%) and there may be some cap on deductions. The Dems would make a bigger concession:
the headline Democratic concession is likely to be that the Medicare eligibility age rises from 65 to 67The thinking is the the ACA would soften the blow of such an increase, and Ezra implies that Nancy is not saying no. But Prof. Krugman isn't having any of it.
It would be terrible policy even if the Affordable Care Act were going to be there in full force for 65 and 66 year olds, because it would cost the public $2 for every dollar in federal funds saved. And in case you haven’t noticed, Republican governors are still fighting the ACA tooth and nail; if they block the Medicaid expansion, as some will, lower-income seniors will just be pitched into the abyss.Then he proceeds to raise some very strenuous objections to this line of thinking. The objections are entirely valid, in my view, but (call me naive) premature.
You don't want to get carried away by the sausage making. Frankly I can't believe that Pres. Obama would make a deal like this, especially with all the GOP governors still doing all they can to sabotage Obamacare. He also has the leverage to make a much better deal; Krugman notes that he can do nothing and get a 39.6% tax rate.And of course, raising the Medicare age is just fool's gold -- you take the healthiest seniors out of the insurance pool and, evne with Obamacare, they're still the highest, most expensive risk in the "regular" pool. Nonetheless, I can't get worked up over this speculation because it's just part of the Beltway back and forth. When he was in a crappy postion in 2011, the President still got stimulus with the payroll tax cut extension and the unemployment benefit extension. Still, it would be a little reassuring to hear that Medicare and Medicaid are off limits (like Social Security) period, end of story, full stop.