Earlier today the co-chairs of President Barack Obama’s National Commission on Fiscal Responsibility and Reform, Democrat Erskine Bowle and Republican Alan Simpson released a proposal to curtail Social Security benefits, drastically cut federal spending, and increase taxes for millions of Americans as a means of cutting the nation’s total deficits by as much as $4 trillion over the next decade.
Not surprisingly, lawmakers (including the White House) were somewhat less than enthusiastic about the proposals:
The White House responded coolly, some leading lawmakers less so to proposals that target government programs long considered all but sacred. Besides Social Security, Medicare spending would be curtailed. Tax breaks for many health care plans, too. And the Pentagon’s budget, as well, in a plan designed to cut total deficits by as much as $4 trillion over the next decade.
The plan arrived exactly one week after elections that featured strong voter demands for economic change in Washington. But criticism was immediate from advocacy groups on the left and, to some extent, the right at the start of the post-election debate on painful steps necessary to rein in out-of-control deficits.
The plan would gradually increase the retirement age for full Social Security benefits — to 69 by 2075 — and current recipients would receive smaller-than-anticipated annual increases. Equally controversial, it would eliminate the current tax deduction that homeowners receive for the interest they pay on their mortgages.
The proposal for smaller annual increases, which would come about due to a change in the inflation measurement used to calculate cost-of-living adjustments for benefits, was met with strong and vocal opposition, and there’s no doubt the proposal to raise taxes will raise the ire of conservatives who are loathe to raise taxes.
There’s a reason Social Security reform is commonly referred to as the “third rail” of politics, and the proposals made by President Obama’s National Commission on Fiscal Responsibility and Reform are a perfect example of why.