On Tuesday, President Obama spoke to a group of CEOs at the Wall Street Journal CEO Council. And--this should surprise no one--he again explained how he wants to cut Social Security and Medicare benefits.
Below, I've highlighted some key passages from his talk on this and other matters of budgetary priorities.
THE PRESIDENT: Actually, Larry and I, and most of my economic team -- in fact, all of my economic team -- have consistently maintained that there is a way to reconcile the concerns about debt and deficits with the concerns about growth.Sorry, but having the smallest discretionary budget since Eisenhower isn't something of which to be proud--especially in a depressed economy. I could cite endless columns or books by Paul Krugman, Joe Stigilitz, Dean Baker, etc., that show why deficit reduction in a time of high unemployment is disastrous policy. But the president doesn't seem to understand the relationship between his sharp deficit reduction and the continuation of high unemployment. And the budget caps imposed by the Budget Control Act of 2011 are not a model of efficiency.
What we know is, is that our fiscal problems are not short-term deficits. Our discretionary budget, that portion of the federal budget that isn't defense or Social Security or Medicare or Medicaid, the entitlement programs, is at its smallest level in my lifetime, probably since Dwight Eisenhower. We are not lavishly spending on a whole bunch of social programs out there. And in many ways, a lot of these programs have become more efficient and pretty effective.
Defense, we spent a lot from 2001 to 2011, but generally we are stabilizing. And the Pentagon, working with me, have come up with plans that allow us to meet our security needs while still bringing down some of the costs of defense, particularly after having ended the war in Iraq and on the brink of ending the war in Afghanistan.You want to stay in Afghanistan until "2024 and beyond." That's not "on the brink" of being over.
Also, there's that thing about the Cold War being over and the U.S. not facing any existential threats. Yeah, that. Remember that?
Also, Reuters just ran a series on the epic waste at the Pentagon. There's quite a bit of "stabilizing" to be done then.
So when we talk about our deficit and debt problems, it is almost entirely health care costs. You eliminate the delta, the difference between what we spend on health care and what every other country -- advanced industrialized nation spends on health care, and that’s our long-term debt. And if we’re able to bend the cost curve, we help solve the problem.And we could balance the budget with a genuinely universal system such as those in other advanced industrial countries. Sadly, that's not what we have under the ACA. It is just a modest improvement that tinkers around the edges without making the much-needed structural changes to the system.
Now, one way to do that is just to make health care cheaper overall. That’s I think the best way to do it, and that’s what we’ve been doing through some of the measures in the Affordable Care Act. There are some other provisions that we could take that would maintain our commitment to seniors, Medicare, Social Security, the disabled, and Medicaid, while still reducing very modestly the costs of those programs.(emphasis added)
To me, that's code for chained CPI and increased means testing of universal benefits, both of which are in his budget.
If we can get beyond the tactical advantages that parties perceive in painting folks as extreme and trying to keep an eye always on the next election, and for a while at least, just focus on governing, then there is probably 70 percent overlap on a whole range of issues. A lot of Republicans want to get infrastructure done, just like I do. A lot of them believe in basic research, just like I do. A lot of them want to reform entitlements to make sure that they’re affordable for the next generation; so do I. A lot of them say they want to reform our tax system; so do I.(emphasis added)
Remember when Obama said that he and Romney agreed on Social Security during the first debate last year? He still feels that way. And I'm sure the CEOs in his audience are happy to hear it.