The Great Debate

President Barack Obama’s budget, released Wednesday, is getting a lot of criticism from ideologues on the right and left. That is one of the most encouraging things about it.

Though the president’s budget falls short in several important ways, it demonstrates his willingness to compromise — something most Democratic and Republican legislators have resisted. Now comes the critical stage in any real effort to achieve a “grand bargain,” when the president can show true leadership by bridging the divide between the parties and using the bully pulpit to address the American people in a constructive fashion that can lead to a deal.

The most helpful thing about the Obama budget is that, for the first time, the president has publicly proposed reforms to two key social insurance programs. By adopting a GOP-backed change in the inflation calculator — the so-called chained CPI — the president is accepting adjustments in the cost of living payments for those receiving Social Security.

He is also renewing his verbal offer to Republicans from last December’s negotiations for more than $400 billion in healthcare savings – including roughly $370 billion in Medicare spending over the next 10 years. His budget proposes to expand means testing for Medicare premium subsidies.

These proposals don’t go far enough. But they put social insurance programs on the table for discussion. That is a positive step.

Defying your base is always risky. It can either bring you down — or it can make you look stronger.

Right now, politicians in both parties are trying to pull it off.  Senator Marco Rubio (R-Fla.) – a likely contender for the 2016 Republican nomination – is preparing to challenge conservatives on immigration reform. President Barack Obama is defying liberals on entitlement reform. What are they thinking?

Your base is people who are with you when you’re wrong.  Sooner or later, every politician gets in trouble. He needs people to stick up for him — people who say, “He was there for us and we’ll be there for him.” President Ronald Reagan’s base, for example, stuck with him during the Iran-contra scandal. So did President Bill Clinton’s base during impeachment.

Social Security is not the problem – it is the solution.

Washington is filled with talk of a looming “retirement crisis.” The discussion focuses on funding Social Security and usually includes calls to cut benefits – either by changing payout formulas or raising the retirement age.

But the real problem is not the long-term solvency of Social Security. Rather, it is the fact that millions of Americans are facing an insecure and underfunded retirement.

The best way to address this retirement issue would not be to cut Social Security but to expand it, as Michael Lind, Steven Hill, Robert Hiltonsmith and I argue in a new paper released Wednesday. By increasing the public portion of the American retirement system, we can spend the same or less on retirement as a share of the economy while making the system as a whole much more progressive and stable.

Washington has been fascinated by Republican self-laceration since the 2012 election. Karl Rove triggered a circular firing squad by vowing to take out unwashed challengers in GOP primaries. Louisiana Governor Bobby Jindal begged Republicans to stop being the “stupid party.” Strategists say the party can’t survive as stale, pale and male. Tea Party legislators knee-cap GOP congressional “leaders” and well-funded political PACs strafe any who dare deviate from the party’s unpopular gospel. Republicans are even talking about changing “Grand Old Party” to something more fashionable.

Representative Paul Ryan’s newest budget will put every Republican on record voting to turn Medicare into a voucher, gut Medicaid, repeal Obamacare, savage investment in education and leave some 50 million Americans without health insurance. Not surprisingly, polls suggest Congress is less popular than colonoscopies, and Republicans poll at lowest levels on record.

The re-engaged president is pressing reforms on immigration, gun violence, gay marriage and climate change. These issues help consolidate his majority – the “rising American electorate” of young voters, minorities and single women.

The Gang of Eight: (Top Row, L to R) Senator Mark Warner (D-Va.), Senator Saxby Chambliss (R-Ga.), Senator Tom Coburn (R-Okla.) Senator Kent Conrad (D-N.D.) (Second Row, L to R)) Senator Mike Johanns (R-Neb.), Senator Mike Crapo (R-Idaho), Senator Dick Durbin (D-Ill.), Senator Michael Bennet (D-Colo.)  REUTERS/File

There is growing momentum in Washington and around the country in the fight to restore fiscal sanity. So get ready for the counter-attack by the special interests and ideologues.

A growing number of Republicans have now stood up to Grover Norquist’s organization, Americans for Tax Reform, and disavowed the pledge they signed to not raise taxes. We should all commend legislators like Senator Saxby Chambliss (R-Ga.), Senator Lindsay Graham (R-S.C.) and Representative Peter King (R-N.Y.), who have recently joined in refusing to put ATR’s pledge ahead of the nation’s interests.

The focus in Washington has now shifted to the fiscal cliff, with the White House and Congress, particularly the House Republicans, staking out negotiating positions on the expiring Bush tax cuts and the looming budget sequester.

The White House’s firm opening salvo—and House Speaker John Boehner’s grudging admission that he is “open” to a budget deal that contains new revenue—have been much discussed. With six in 10 Americans expressing support for higher taxes in exit polls on Nov. 6, President Barack Obama’s position is a strong one.

It’s important to remember, however, that the public came out on Election Day in support of more than Obama’s tax stance. Exit polls and public-opinion surveys show that the president’s mandate goes far beyond taxes and the fiscal cliff.

ILLUSTRATION: MATT MAHURIN

Former GOP presidential nominee Mitt Romney said in a Wednesday conference call to donors that President Barack Obama won re-election because he promised “big gifts” to voters, “especially the African-American community, the Hispanic community and young people.” Romney singled out healthcare reform as a “huge” gift to these voting blocs and the working poor.

This echoes what the conservative commentator Bill O’Reilly has been saying. “The demographics are changing,” O’Reilly lamented on election night. “This is not a ‘traditional America’ anymore.” Latino, black, and women voters, he noted, were turning out for Obama. They did so, O’Reilly said, because “they want stuff.”

The audacity of these claims is breathtaking. The Romney campaign promised $5 trillion in tax cuts and a pile of regulatory and other favors to the wealthiest Americans. Over the past three decades such conservative “gifts” have helped the top 1 percent of earners – the likes of Romney and his donors – to nearly triple their incomes and double their share of the national income.

The election left us with a status quo political lineup, one that failed to make any meaningful fiscal progress over the past two years. So is it realistic to expect that we can avoid the fiscal cliff and achieve some sort of “grand bargain”? Yes, it is possible, and here is how to do it:

First, President Barack Obama should form a “unity Cabinet” to demonstrate to the public and Congress that he wants to bring the nation together and accelerate progress on key challenges. It should include Democrats, Republicans and independents. All should be respected in both parties, have meaningful private-sector experience and credibility within and outside the Washington Beltway.

These criteria are especially critical when it comes to the president’s top economic team. Obama will almost certainly change the leadership at the Treasury Department, since Treasury Secretary Timothy Geithner has talked about leaving after the first term, and the Office of Management and Budget. Smart appointments could help reboot Obama’s relationships with Congress and increase the chance of success.

“I am looking forward to reaching out,” President Barack Obama said Tuesday night after he had won reelection, “and working with leaders of both parties to meet the challenges we can only solve together.”

The progressive community must understand this and put aside its rigidity to help him meet this goal. As Obama also said early Wednesday morning, “We’ve got more work to do.”

Yet a network of liberal groups, on Thursday, plan to demand a national day of action against a balanced, grand bargain that could pull the nation back from the fiscal cliff it faces. The beef of this progressive coalition is that a real budget deal would almost certainly cut Medicare spending and may possibly include a proposal to make Social Security solvent through the century.

It’s all in the wording. Throughout this presidential campaign, voters have heard a stream of claims and counterclaims about “entitlements” – payments the federal government makes to individuals.

The power of words to frame political ideas can’t be overemphasized. How we label specific practices and proposals affects the ways we think about them. Decades ago statisticians and economists used a neutral phrase, “transfer payments,” to describe various government disbursements: unemployment assistance, old-age pension support, food for the hungry, disbursements to veterans and federal employees.

By calling these “transfer payments,” they sought to focus on accounting techniques. They wanted to avoid the kind of charged labeling and stigmatization that we see today -‑ which prevents thoughtful discussion of the effects and benefits of these practices.