Warren, Sanders Ready to Face Down Obama over Social Security, Medicare Cuts

As budget negotiations restart, Obama, GOP still pushing austerity

– Jacob Chamberlain, staff writer

Both images: Reuters

Though the ‘deficit scold dream‘ of a so-called ‘Grand Bargain’ may be diminished on Capitol Hill, a mini-version—circulating among some as the ‘Small Deal’ version of a 2014 austerity budget—is still on the table as congressional budget negotiations are set to resume Wednesday.

With austerity proposals again taking the lead in the latest budget battle, however, at least two progressive senators, Bernie Sanders of Vermont and Elizabeth Warren of Massachusetts, are ready to fight such a deal.

“Instead of talking about cuts in Social Security, Medicare and Medicaid, we must end the absurdity of corporations not paying a nickel in federal income taxes.” –Sen. Bernie Sanders

“Instead of talking about cuts in Social Security, Medicare and Medicaid, we must end the absurdity of corporations not paying a nickel in federal income taxes,” Senator Sanders, who is on the Senate and House budget conference committee, wrote in an op-ed in the LA Times Monday.

Pushing for progressive tax reform as opposed to further cuts to key social programs and earned benefits, Sanders added, “We cannot impose more austerity on people who are already suffering. When 95% of all new income between 2009 and 2012 went to the top 1%, and while tens of millions of working Americans saw a decline in their income, we cannot cut programs that working families depend on.”

Among the austerity proposals put forth in Obama’s 2014 budget and still considered a bargaining chip in the new round of talks, significant worry among progressives centers around a plan that would reduce the annual cost of living calculations for Social Security payments, known as the ‘Chained CPI’, which would effectively reduce benefits for seniors.

“Chained CPI is just a fancy way to say ‘Cut benefits for seniors, permanently disabled, and orphans,’” warned Sen. Warren in a recent interview. “Our Social Security system is critical to protecting middle-class families, and we cannot allow it to be dismantled, inch by inch.”

According to the Boston Globe’s analysis, “Warren’s voice on the issue is key to liberals, and could put pressure on other Democrats to avoid compromising on the issue.”

“Our Social Security system is critical to protecting middle-class families, and we cannot allow it to be dismantled, inch by inch.” – Sen. Elizabeth Warren

“Her six-minute floor speech on the role of government during the shutdown,” the paper notes, “drew about 1 million views on YouTube, even though she had no official role in leading the Democrats’ case.”

A so-called ‘Grand Bargain,’ which would overhaul the tax code by lowering the corporate tax rate alongside deeper social spending cuts, has been on the docket since budget talks began late last year. A subsequent series of failed negotiations led to the ongoing budget sequester of $100 billion in across-the-board cuts per year (or until lawmakers agree on a new plan) and a series of near budget catastrophes such as the government shutdown that ended earlier this month.

Republicans have held firm against progressive tax reform pushed by lawmakers such as Warren and Sanders. Meanwhile, the Obama administration has increasingly urged support for a right-leaning bargain laced with cuts.

But as an editorial in The Nation magazine recently argued, trying to find “common ground” with the obstructionist Republican Party is exactly the wrong strategy and Obama’s consistent call for a “balanced approach” to the budget is both bad economics and bad politics. Instead, according to the editorial:

[Obama and the] Democrats should be capitalizing on their stronger position by demanding a budget that fits the needs of the moment: one that ends the painful cuts caused by sequestration, invests in infrastructure and job creation, and provides desperately needed resources to state and local governments. Democrats and their allies must recognize that their current advantage is not guaranteed or permanent, and it is not so fail-safe that the party can abandon principle in the shaping of a budget deal. They now have an opportunity to redefine the debate fundamentally, away from the absurd focus on deficit-cutting—the deficit is actually plummeting—and toward the real crisis of our time: high unemployment and record inequality.

When it comes to addressing the long-term budget deficit over a short-term jobs program, said Sanders, “The president is dead wrong.”

“It’s OK to spend trillions on a war we should never have waged in Iraq and to provide huge tax breaks for billionaires and multinational corporations,” Sanders wrote, describing the viewpoint of Republican leaders. “But in the midst of very difficult economic times, we just can’t afford to protect the most vulnerable people in our country.”

“That’s their view. I disagree,” he said.

Sanders and Warren were joined by Rhode Island Democrat Senator Sheldon Whitehouse, who was quoted in the Boston Globe saying he was “fully opposed” to Obama’s chained CPI proposal. Whitehouse also serves on the budget committee.

The joint budget committee is expected to offer proposals by December 8, and a deadline for lawmakers to come to an agreement has been set for January 15.