Behind the Chained CPI Outrage Is an Obama Budget That Is a Democratic Wish List

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Laser eyes

It is not the least bit unusual for athletes, the best athletes, to learn to have laser-like focus on a goal whether it is a basketball hoop, a space between a hockey goalie’s legs, or a 100 mile-per-hour spinning tennis ball off the racket of a tennis star. That ability to tune out peripheral sights and sounds is a feat that takes years of practice and self-discipline along with an acute mental attitude few human beings possess. Toward the end of last week, and all this week, many on the left displayed laser-like focus on President Obama’s symbolic budget proposal and honed in on his inclusion of the Center for American Progress’s budget recommendation to shift to Chained-CPI in calculating cost of living adjustments for Social Security and other government programs, and unfortunately they tuned out nearly every other proposal the President made for reducing the debt. It is really too bad, because the President’s proposals contain a great deal of Democrats’ long-cherished wishes and few are paying any attention.

First, it is true Chained CPI is not everyone’s favorite item in the President’s purely symbolic budget proposal, but buried where a fine-tuned Democrat would never look is the Center for American Progress’s recommendation to protect the most vulnerable Social Security recipients to keep them from falling into poverty. If the Progressive think tank’s name fails to convince anyone they are not a shadow-organization controlled by the Koch brothers, they are the pre-eminent Progressive organization in the nation. But let us not focus on Chained CPI and peruse some of the President’s other proposals that Senate Minority Leader Mitch McConnell called “just another left-wing wish list,”.

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There is a reason John Boehner, McConnell, and Paul Ryan dismissed the President’s proposal out of hand as too extreme for their wealthy supporters, and not nearly Draconian enough and punitive to the poor for their conservative tastes. The deficit cutting measures “buried” in the President’s budget are a mirror-image of the outline he offered Boehner last year and during the fiscal cliff manufactured crisis. The President said, “I don’t believe that all these ideas are optimal, but I’m willing to accept them as part of a compromise,” and “I’ve already met Republicans more than halfway. So in the coming days and weeks, I hope that Republicans will come forward and demonstrate that they’re really as serious about the deficits and debt as they claim to be.” One thing is certain, President Obama is really serious about holding the richest 1% of Americans accountable for paying their fair share to help reduce the debt and deficit and get them off the Republican entitlement train.

The proposed budget achieves $1.8 trillion in deficit reduction over 10 years, and added to the $2.5 trillion in deficit cuts from past efforts, the total reduction would be more than $4 trillion the President and Republicans claimed would be an acceptable goal. Under the President’s budget, the ratio of deficits to GDP would fall to 2.8% in 2016, and below the 3% level economists say is necessary to put debt on a path to shrinking as a share of the economy. The non-partisan Congressional Budget Office (CBO) in February projected the U.S. deficit to be 5.3% of GDP this year; deficit hawks in the Republican Party should be ecstatic.

The proposal revives the President’s successful campaign message calling for wealthier people to help more with deficit reduction, especially in light of their windfall after they assisted driving up the deficit with their obscene tax cuts Americans will be paying for over the next generation. The budget requires the rich making $1 million a year or more to pay at least 30% of their income in taxes, caps tax breaks for wealthier taxpayers, increases the estate tax, and ends the tax break for “carried interest” profits earned by fund managers like Willard Romney that allows him to pay a lower income tax rate than his gardener. It reduces the threshold for estates from $5 million to $3.5 million, and then raises the tax rate from 40% to 45%, and caps the value of tax exemption for interest paid by municipal bonds, an idea that infuriates the $3.7 trillion municipal bond market. If those items are insufficient to grab the attention of Democrats angry over Chained CPI, the President’s budget also replaces the Republicans’ job-killing, poverty increasing, and economy stunting sequester.

The Obama budget is also in line with proposals he talked about during his State of the Union address in January such as new spending on policy priorities such as infrastructure improvement and expanded pre-school programs financed by raising the federal tobacco tax that should enrage Boehner’s campaign donors. Also included is a 10% tax credit for small businesses that raise wages or hire new workers to encourage them to start hiring and pay their employees a decent living wage, and all of these programs are funded by eliminating tax breaks for Republicans’ precious wealthy donors.

Republicans like Boehner and Ayn Rand devotee Paul Ryan were appalled with the President’s budget because it lacks severe cuts to Social Security and Medicare Republicans lust after, and does not include cuts to education, food Stamps, and healthcare programs for the poor, elderly, Veterans, and children. Ryan also could not comport the absence of a 14.9% tax cut for the richest 1% of income earners his “Path to Prosperity” for the wealthy included. The only thing Ryan, McConnell, and Boehner warmed to was, according to Ryan, the President’s “willingness to address entitlements, but we’re obviously a long way from there right now” and complained that healthcare and social programs are not eviscerated, as well as being very unhappy the Republican sequester is replaced to save jobs and spur economic growth.

It is likely the President’s budget will never reach fruition, but it does signal to voters, and Democrats, that his campaign promises and agenda from his State of the Union are still front and center as a means of creating jobs, rebuilding the middle class, and rejuvenating the austerity-crippled economy. The President readily admitted it is not his ideal budget, but it contained, as Mitch McConnell said, “another left-wing wish list” that sadly, hardly any Democrats noticed because they were so laser focused on those ten letters, C-h-a-i-n-e-d C-P-I, to recognize that, like the Center for American Progress’s budget, it contained everything Progressives have dreamt of for the past thirty years.

 

 

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