Saturday Reads: Austerity, Medicare, and Punishing the Baby Boomers

fiscal cliff fix

Good Morning!!

Following on Dakinikat’s post last night, The Austerity Plot, here are some more links about Jonathan Chait’s very very bad recommendation that Obama should cave on raising the Medicare enrollment age.

David Dayen’s reaction was immediate and shrill: Jon Chait’s Miserable Endorsement of Raising the Medicare Eligibility Age.

Let’s look at Chait’s reasoning. I would probably start with the fact that he’s not 64 or 65. My parents are, and until my dad reached Medicare in November, they were paying $2,500 a month on the private market for health insurance. So I’ll be happy to provide him with their phone number so he can tell them how it’s “tolerable” for them to spend two years more than they expected doing that.

But soft! Here are his actual reasons. One, Democrats have to accept concessions (that’s always a good strategic place from which to begin a negotiation!), and the scolds seem to like raising the eligibility age. So let’s give ‘em what they want. This is a bizarrely content-free assertion. The phrase “If Alan Simpson and Erskine Bowles wanted you to jump off the Brooklyn Bridge, would you do it?” springs to mind. Second, he thinks that Republicans will somehow forget that this only raises $100 billion, at most, over 10 years, and will then drop any demands to hit a particular number in the negotiations….

The one thing we know will be a side effect of increasing the Medicare eligibility age is that insurance premiums will skyrocket. It will make Medicare more expensive because they lose relatively healthy 65 and 66 year-olds from their risk pool, and it will make private insurance more expensive because they add relatively sick 65 and 66 year-olds to their risk pool. Insurers hate the idea for just this reason. As a result, everyone’s premiums will rise, and cost-shifting will ensue from the government to its citizens.

The original Shrill One, was even more shrill than usual.

…why on earth would Obama be selling Medicare away to raise top tax rates when he gets a big rate rise on January 1 just by doing nothing? And no, vague promises about closing loopholes won’t do it: a rate rise is the real deal, no questions, and should not be traded away for who knows what.

So this looks crazy to me; it looks like a deal that makes no sense either substantively or in terms of the actual bargaining strength of the parties. And if it does happen, the disillusionment on the Democratic side would be huge. All that effort to reelect Obama, and the first thing he does is give away two years of Medicare? How’s that going to play in future attempts to get out the vote?

As Dakinikat wrote, Beltway Bob immediately accepted Chait’s assessment of the likely “deal,” even though he explained very clearly last night as host of the Rachel Maddow Show that doing this would be insane and counterproductive.

Ed Kilgore defended Chait:

I do think it’s kind of important that progressives allow each other a bit of liberty in discussions about big fiscal issues: after all, even the Right-Wing Noise Machine is in a bit of disarray on the subject at the moment. I know some people think resisting anything that affects Social Security or Medicare benefits is the ultimate Red Line that cannot be crossed. Personally, my own fear is that in defending that Red Line, congressional Democrats will wind up making concessions on Medicaid and other low-income programs that in my opinion are more morally compelling than keeping Medicare precisely the way it is today.

Maybe my fears are misguided, or maybe I just don’t share the obsession of some liberals in keeping Medicare pristine as a potential model for a universal single-payer health care system somewhere in the distant future, even if that means today’s poor folks have to suffer as a lower priority.

Apparently, Kilgore doesn’t understand that millions of poverty stricken elders are on Medicare and that millions of middle class Americans rely on Medicaid for nursing home care in addition to Medicare. It’s not an either/or thing.

Atrios gave Chait the Wanker of the Day Award, and yesterday evening, Chait issued an “acceptance speech” that doubled down on his recommendations for Medicare cuts in a post that I personally found offensive–but then I’m one of those loser 65-year-olds, so what do I know?

I, along with millions of other losers, committed the horrendous crime of being born after WWII ended and thus became part of the despised population bomb called the “baby boom.” Never mind that we didn’t ask to be born when we were and that public officials have known about our huge numbers ever since 1960 at least, the problem is all our fault. Supposedly, Ronald Reagan fixed the problem by having us pay more into the system so that Social Security and Medicare would be there when we got old, but now that is all forgotten because the superrich need more money to sock away in foreign tax havens.

WH_CARTOON_071029

Kenneth Baer and Jeffrey Liebman wrote about it in a NYT op-ed yesterday:

For decades we have known that the retirement of the baby boomers would be a monumental event for the economy. But now that it’s happening, many fiscal policy makers are acting as if the boomers are eternal teenagers and are turning a blind eye to how the boomers’ aging changes how we should approach economic policy. And this affects two of the central issues of the negotiations: how much the government should spend and how we can cut unemployment.

Consider the debate over spending. The Congressional Budget Office projects that if current policies continue, total federal spending will rise to 24 percent of gross domestic product in 2022. Republicans and Washington deficit hawks argue that this means spending is out of control, since over the past 40 years government spending has averaged 21 percent.

Their proposed solution is a cap on government spending as a percentage of the economy. Mitt Romney wanted to cap spending at 20 percent of G.D.P. Senator Bob Corker, Republican of Tennessee, has proposed a cap of 20.6 percent with Senator Claire McCaskill, a Democrat from Missouri. Just this week, Gov. Bobby Jindal of Louisiana, a 2016 Republican presidential aspirant, suggested an 18 percent cap.

These plans ignore the simple fact that you cannot repeal the aging of the boomers. The main reason expenditures are rising this decade is that spending on Social Security, Medicare and Medicaid is increasing by a whopping 3.7 percent of G.D.P. as the baby boomers age and retire. This demographic fact also has been driving increases in disability insurance payments as more knees give way and backs give out.

In addition, policy-makers need to be looking at unemployment differently, according to Baer and Liebman, but are they capable of doing that? Not likely. Read more about it at the link.

rich xmas

In other “news,” on Thursday, Fox News’ Monica Crowley (did you know she has a Ph.D.?!) claimed that Americans committed “national suicide” by re-electing Obama, because now the rich will have to pay more taxes.

“From a conservative perspective, November 6 was a national suicide,” Crowley asserted. “There is a very thin, fine, red line between us and total destruction of the American idea. That thin, red line was the Republican Party. If this party also commits suicide, this will be catastrophic.”
Raw Story (http://s.tt/1wd0V)

Charlie Crist has officially become a Democrat.

Former Republican Governor Charlie Crist announced his official switch from independent to the Democratic Party with a beaming Twitter post Friday night after a Christmas event at the White House.

Posing in a photo with an unidentified woman holding the official Florida voter registration papers, Crist tweeted he was “proud and honored to join the Democratic Party in the home of President @BarackObama!”

I wonder if he’s going to get a job in the administration? Or will he run for governor against Rick Scott?

Finally, Susie Madrak has a must-read post at Crooks and Liars: Obama Cheaps Out On Sandy Recovery to Prop Up Austerity Sham. It’s a quick read, so please go read it at the link.

That’s all I have for today. Now it’s your turn. What’s on your reading list?

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62 Comments on “Saturday Reads: Austerity, Medicare, and Punishing the Baby Boomers”

  1. Pat Johnson says:

    The elderly couple across the street from me are examples of what the government is capable of doing for those who no longer are able to care for themselves.

    She is now in a nursing home from having contracted Alzheimers Disease and he was no longer capable of taking care of her. She wandered, was easily confused, and her symptoms produced violent tendencies that left him at risk Though the family tried to help it became increasingly clear that she needed the benefit of a 24 hr nursing care and last year, on the eve of their 55th wedding anniversary, he had no choice but to place her in care.

    This past summer he suffered a fall that forced him to undergo hip replacement therapy. He was sent to a nursing home for rehab but has since returned to his home with a walker, Meals on Wheels, and the comfort of having familiar surroundings as he gets his strength back.

    What would happen to them as a couple in their late 70s if there was no government help? Reducing costs for the benefit of the rich is exactly the scenario this measure would produce: elderly people “on their own” at a time when they most needed assistance.

    The fact is that there are many other stories like this going on throughout the nation that gets little coverage. It is a human experience none of us wish to ever encounter.

    The family, aside from their good intentions, were incapable of taking care of this poor woman who no longer recognized them as her elderly spouse tried to cope as long as he could. When he suffered from a fall they did all that was needed to ensure his return to live out his life in a semblance on dignity and peace.

    Taking these safety planks away is going to cause undue damage to seniors who would then have no other choice but to go bankrupt in trying to keep up with medical bills alone.

    The people making these decisions should be ashamed of themselves.

    • dakinikat says:

      Rethugs seem to like starving children too given their treatment of food stamps. They just want the poor to die. Witness Katrina and Sandy too.

    • Beata says:

      My mother has been in a skilled nursing home for going on 11 years now. I can’t even begin to tell you the heartbreaking stories of residents and their families I have gotten to know there. Changes to SS, Medicare, and Medicaid will be devastating to this growing segment of the population. They are not going to be able to be cared for at home. I know because I tried to care for my mother at home until it almost killed me. It was a nightmare. I continue to oversee her care and worry about her every day.

      • Beata says:

        I worry most about cuts to Medicaid since it pays for long-term nursing home care and Medicare does not. I have seen many nursing home residents who thought they were financially secure have to go on Medicaid when their money ran out. It can ( and does ) happen even to people who plan well for their futures.

      • bostonboomer says:

        Medicare and Medicaid pay for home care for people in poverty. The cuts will most likely come from home health care first. I cared for my mother-in-law for many years, and couldn’t have done it without home health care aid.

      • Beata says:

        BB, I know home health aid is a lifesaver for some families. Unfortunately, I didn’t have good experiences with home health aid for my mother. One home health aide was high on drugs, another stole from my mom. I finally did find a wonderful woman to help me for a few hours a week but she didn’t last long before getting a better paying job with the hospital in town. But by that time both my mother and I were so sick, she had to go into the nursing home. I always swore I would not let that happen but I really had no choice. I still feel guilty about it.

        The bottom line is that we as a county need to care for our most vulnerable. Are we a civilized society or a bunch of barbarians? Time will tell.

      • Beata says:

        That should be “we as a country” not “county”.

        I really need to find a funny YouTube to post. I’ve turned into a Debbie Downer.

  2. quixote says:

    Actuaries — and anyone who thinks about it for a minute — are pointing out that raising the Medicare age to 67 will raise premiums for everybody.

    They’ll raise the cost of Medicare because the relatively healthy 65-67 group is no longer in the pool. They’ll raise the cost of all other insurance as the relatively unhealthy seniors (compared to younger adults) are added to those pools. (That’s when they can pay for it at all.)

    But then, think about ACA/Obamacare itself. One of its main effects is to hand a huge windfall of new compulsory customers and government-supported premiums to Big Insurance.

    So, in my nasty suspicious mind my first thought is: “Higher premiums. It’s not a bug. It’s a feature.”

  3. Hey y’all, I wanted to update you on my brother Denny. He was going to have surgery on his broken arm, but they decided to try and put a cast on him…there was some concern over his reaction to having surgery. So, he gets this cast on his arm, and what does he do last night? He pulls the damn thing off. This morning my dad had to take him back to the ER. He goes back to the Dr. on Monday, don’t know what they will do then. Sigh…

    Hope everyone is having a decent weekend. There is just too much shit going on at home, I can’t wait till this season is all over and done with…

    • bostonboomer says:

      Oh, no! That’s a shame, JJ. If he has surgery, he’ll still have to have bandages and a sling. I hope he can handle that.

      • Yeah, me too…surgery means pain and bandages, but it would not be a cast, and that is obviously something he can’t handle at all.

      • NW Luna says:

        Should be able to keep pain to a minimum with the proper meds. But after an internal (surgical) fix of a fracture they’ll still want to keep the two parts from getting moved or the fracture won’t heal well.

        Hope all works out as well as possible!

    • HT says:

      JJ – big hugs coming your way. This year has been a shit storm for a lot of us. I’d like to think 2013 will be better, but that’s what I said at the end of 2011 – oh 2012 will be lots better – of course that was before I tripped, broke my shoulder and upper arm in three places, my brother died unexpectedly, my cousin died unexpectedly and a close friend died unexpectedly. They were all under 60. So I have no expectations for 2013 – I’m just hoping it won’t be as bad for all of us as 2012.

      • Beata says:

        Ditto, HT. We need to try to keep a sense of humor about it all or we will go mad. My mother used to say that.

      • HT says:

        Your mother was a wise woman Beata. I know you’ve had one hell of an awful year too, as has Fredster. It’s a sad, sad situation when the politicians focus on what they believe is a vulnerable demographic. Little do they know, we are rather feisty when provoked. I doubt that I would chain myself to a fence (as I did in the 60’s for women’s equality), but I can carry a protest sign and my voice can be quite loud and strident. I hope that won’t be necessary, but I’m mad as hell, and I’m ready.

  4. Holy Shit, what the hell happened last night? All this Austerity and Social security crap hit the fan! Damn….

  5. RalphB says:

    Adele Stan at Political Animal realizes Ed Kilgore missed the point.

    Medicare Eligibility Age on the Table?

    In Washington, when a rumor just won’t die, it begins to look like strategy. And one rumor that has Washington riveted is the potential for a deal on the fiscal shenanigans needed to stave off sequester that would raise the eligibility age for Medicare.
    […]
    Earlier this week, Brother Kilgore wrote of invective aimed at New York magazine’s Jonathan Chait for his suggestion that, despite the fact that a raise in eligibility age would cost the federal government billions and billions more than if the current eligibility age of 65 were maintained, it might be worth trading away to the Republicans in order to avoid the fiscal insanity that is sequester. (No, I won’t call it that thing that rhymes with “riff”.)

    But the added cost is not the trigger for the invective; that comes from this: Raise the eligibility age and PEOPLE WILL DIE.

    No, that’s not an exaggeration, and the failure of certain wonks to take that into consideration speaks to their isolation from everyday people, even the everyday people who provide services to them, such as grocery-store clerks, waitresses, and construction workers in right-to-work states. These are people who cannot wait until they’re 67 for the full complement of Medicare benefits.
    […]
    But if everyone in your family is college-educated and has a good job with adequate health insurance, why would it even cross your mind that not everybody does?

    Here’s my hope: that this rumor is being floated in order to create enormous pushback from the left that would give Obama cover for rejecting it. Time to push.

  6. RalphB says:

    By the way, has anyone else noticed there has been no Susan Rice mentions lately?

    TP: McCain’s Susan Rice Smear Campaign Goes Silent

    Now that their campaign has been fully discredited, McCain, Graham and Ayotte are notably silent about Susan Rice and Benghazi. Graham appeared on Fox News Dec. 3 and neither he, nor host Greta Van Susteren, mentioned Benghazi or Rice. And McCain was on the same program last night — Susan Rice never came up during the interview, and McCain only mentioned Benghazi or Libya in the context of whether the U.S. should intervene militarily in Syria.

  7. dakinikat says:

    and they’re looking to dumb us down more:

    Catcher in the Rye dropped from US school curriculum
    Schools in America are to drop classic books such as Harper Lee’s To Kill a Mockingbird and JD Salinger’s Catcher in the Rye from their curriculum in favour of ‘informational texts’.

    http://www.telegraph.co.uk/culture/books/booknews/9729383/Catcher-in-the-Rye-dropped-from-US-school-curriculum.html

    American literature classics are to be replaced by insulation manuals and plant inventories in US classrooms by 2014.

    A new school curriculum which will affect 46 out of 50 states will make it compulsory for at least 70 per cent of books studied to be non-fiction, in an effort to ready pupils for the workplace.

    Books such as JD Salinger’s Catcher in the Rye and Harper Lee’s To Kill a Mockingbird will be replaced by “informational texts” approved by the Common Core State Standards.

    Suggested non-fiction texts include Recommended Levels of Insulation by the the US Environmental Protection Agency, and the Invasive Plant Inventory, by California’s Invasive Plant Council.

    The new educational standards have the backing of the influential National Governors’ Association and the Council of Chief State School Officers, and are being part-funded by a grant from the Bill & Melinda Gates Foundation.

    This is not from the Onion and it’s truly Orwellian.

    • RalphB says:

      Holy shit, that’s ridiculous! Removing all potential joy from education and making it as stupendously boring and worthless as possible will surely be a big help.

      • dakinikat says:

        I was just reading a few conservative blogs that responded to this on memeorandum. They think its a liberal plot … sigh

      • RalphB says:

        I have to admit that it’s hard to contemplate a state actually going along with this. Unless the Bill and Melinda Gates Foundation is giving them tons of money. By why would they do that? Bill may be stupid but Melinda Gates is not.

  8. RalphB says:

    I hope this is true. If so, then losing could be the best thing that ever happened to Mitt and Ann Romney.

    The Amazing Reformation Of Mitt And Ann Romney

    • dakinikat says:

      good grief! that isn’t the onion!

    • NW Luna says:

      “But really, this is more for me than for them. After the election, Mitt and I realized that we had missed something really profound about the American people—that the country maybe wasn’t the place we thought it was.” She caught herself: “I mean, not in a bad way! I just think we realized we had no idea what it was like to be one of, well, I don’t want to use that statistic again, but you know the one I mean.”

      Let’s see how long that lasts (yeah, I’m cynical).

    • Greywolf says:

      Call me cynical, but I don’t believe it. It’s too much change way too fast for me to believe. I’m waiting to find out what the game is…and yes, I do find it sad that I don’t believe they’ve changed for the better.

    • Beata says:

      It’s fiction, not fact. You know, kinda like Mitt but not really.

  9. dakinikat says:

    How the Mainstream Press Bungled the Single Biggest Story of the 2012 Campaign

    http://www.huffingtonpost.com/dan-froomkin/republican-lies-2012-election_b_2258586.html

    Mann and Ornstein are two longtime centrist Washington fixtures who earlier this year dramatically rejected the strictures of false equivalency that bind so much of the capital’s media elite and publicly concluded that GOP leaders have become “ideologically extreme; scornful of compromise; unmoved by conventional understanding of facts, evidence and science; and dismissive of the legitimacy of its political opposition.”

    The 2012 campaign further proved their point, they both said in recent interviews. It also exposed how fabulists and liars can exploit the elite media’s fear of being seen as taking sides.

    “The mainstream press really has such a difficult time trying to cope with asymmetry between the two parties’ agendas and connections to facts and truth,” said Mann, who has spent nearly three decades as a congressional scholar at the centrist Brookings Institution.

    “I saw some journalists struggling to avoid the trap of balance and I knew they were struggling with it — and with their editors,” said Mann. “But in general, I think overall it was a pretty disappointing performance.”

    “I can’t recall a campaign where I’ve seen more lying going on — and it wasn’t symmetric,” said Ornstein, a scholar at the conservative American Enterprise Institute who’s been tracking Congress with Mann since 1978. Democrats were hardly innocent, he said, “but it seemed pretty clear to me that the Republican campaign was just far more over the top.”

    • Pat Johnson says:

      I read their book and they were “spot on”.

      Access is the name of the game for most of these “journalists” and none says it more than someone like Chris Matthews who just last week was gushing all over himself because he had that idiot Alan Simpson on his show.

      Chris was having difficulty keeping the spit from hurling over the desk as he told Simpson of how he was such a “long time admirer” of this creep which immediately called to mind his horrid performances of years past.

      None more so than when this sleazy millionaire called out senior citizens for “sucking on the tit” of government for expecting help in their declining years. How dare they!

      One of the main reasons for Fox News flourishing is that they treat the crap coming from that quarter with respect instead of calling out bullshit when they see it but refer to it as “fair and balanced”.

      How anyone could “respect” Alan Simpson on any level is incomprehensible but leave it to Matthews and his never ending “man crushes”.

      Ugh!

    • RalphB says:

      Talk about telling truth to power, this is it.

      Most reporters, however — including many widely admired for their intelligence and aggressive reporting — simply refused to blame one side more than the other. Mann said he was struck in conversations with journalists by how influenced they were by the heavily funded movement to promote a bipartisan consensus around deficit reduction and austerity. Such a bipartisan consensus doesn’t actually exist, Mann pointed out. But if you believe it does, than you can blame both parties for failing to reach it.

      “The Peterson world, I think, has given journalists the material to keep doing what they’re doing,” Mann said of the vast network of think tanks and other influential Washington groups underwritten at least in part by Wall Street billionaire Peter Peterson.

      Peterson’s vast spending has given rise to an environment of contempt among the Washington elites for anyone who doesn’t believe the government is dangerously overextended. And by that reckoning, the Democrats are therefore more out of touch with reality than Republicans, who at least pay the concept ample lip service.

  10. HT says:

    As a boomer who has worked in industry from the time I was 14 years old, I’m getting really tired of the concept of the boomer as a drain on society. Bull puckey. I have paid taxes for 50 years and am still paying them every year to three levels of government and surprise, I didn’t have very many deductions. Raising two children, I had little money to invest, so there was not a possibility of capital gains deductions, nor spare change to offshore and hide. Like so many, many others who toiled, it frosts my tonsils that all the programs that boomers were forced to invest in through deductions, the pots of money are now considered the brass ring for the wall street cronies to grasp. When will politicians get a spine and declare – NO MORE?

    • bostonboomer says:

      I’ll bet these politicians don’t even know that most baby boomers are worse off financially than their parents were. I sure am. And you know why? Because my dad had the GI Bill to pay for college, a low-interest GI loan to buy a house, and he and my mom were joining the middle class at a time of high taxes on rich people and corporations and much greater economic equality.

      • RalphB says:

        The Vietnam era GI Bill helped me through college, thank goodness. Without it, I would have been most likely been screwed. The GI Bill and associated programs moved a lot of people into the middle class. I think we need some form of national service, with accompanying benefits, now.

      • HT says:

        Agree with all your points. I still have a mortgage for goodness sake. It should have been paid off 30 years ago, but I kept having to borrow against the equity to deal with raising children as a single sole support parent – I don’t regret it, but anytime anyone says we boomers had it easy – my ire rises. And brainstorm – corporations are not people, never have been and never will be – that’s bloody nonsense. GE doesn’t pay a cent in taxes? Most of their profits are make in the USA, yet they pay nothing back to provide good government to the country where the bulk of their profits originate? Rupert Murdoch – a man who has been proven time and time again to be a sleeze bucket allowed to have influence and consolidate a huge media conglomerate at the expense of the American people? That is obscene.

      • NW Luna says:

        Same here.

  11. RalphB says:

    Ed Asner.

  12. RalphB says:

    Atrios, Nerdrage:

    Often the left political internet seems to go something like this:

    Firebagger: Obama’s going to do something bad!

    Obot: No he’s not, but it would be ok if he did anyway but please stop saying he’s going to because he’s not shutupshutupshutupshutup