Blog on the Run: Reloaded

Monday, November 12, 2012 7:21 pm

Repeat after me, kids: There. Is. No. Fiscal. Cliff.

The Washington Post continues to lie, and economist Dean Baker, bless him, continues to call them out on it. Logic having failed, he now turns to mockery:

The Washington Post is throwing all journalistic norms aside in its drive to cut Social Security and Medicare. It continues to hype the budget standoff as an ominous “fiscal cliff” and tells readers on the front page of its web site that it could provide a “magic moment” in which Social Security and Medicare can be cut. The piece begins by telling readers:

“Two years ago this month, the leaders of a presidential commission rolled out a startling plan to dig the nation out of debt. After decades of stagnating incomes, they said, Washington must tell people to work longer, pay higher taxes and expect less in retirement.”

Okay I tricked you, this is the Washington Post which doesn’t acknowledge economic realities like stagnating income. The piece actually began:

“Two years ago this month, the leaders of a presidential commission rolled out a startling plan to dig the nation out of debt. After decades of profligacy, they said, Washington must tell people to work longer, pay higher taxes and expect less in retirement (emphasis added).”

This departure from reality gives you the gist of the story. The piece continues:

“Lawmakers recoiled from the blunt prescriptions of Democrat Erskine Bowles and Republican Alan K. Simpson. But their plan has since been heralded by both parties as a model of clear-eyed sacrifice, and policymakers say the moment has come to live up to its promise.”

Well, yes people have praised their plan. They have also ridiculed it. For example it proposes immediate cuts in Social Security benefits that would be a larger share of the income of the typical beneficiary than President Obama’s proposed tax increases on the top 2 percent would be for most of the affected taxpayers. It also proposes increasing the age for Medicare eligibility, even though this would add tens of billions to the country’s health care costs over the next decade. And, it proposed a minimum Social Security benefit for low wage earners that few low wage earners would actually qualify for due to the number of working years required to qualify.

You  know what the worst thing will be to happen immediately if we don’t have a new deal by Jan. 1? Very rich people will start having to pay a little more in income taxes. Quelle horror.

Also, everyone just needs to shut up about Erskine Bowles being some kind of selfless patriot and/or competent leader. As White House chief of staff, he made Bill Clinton’s affair with Monica Lewinsky possible (not that Clinton wasn’t a Grade A horndog, but you don’t give people like that lots of free time if you expect them to lead the nation without embarrassment). The guy’s an investment banker. He personally will profit a great deal from any kind of austerity deal, as will the investment bank on whose board he sits. Also? Obama is expected to get 60 votes in the Senate to get anything done, a situation the Framers never intended, and Bowles couldn’t even get 14 votes for his own plan from a committee that was named after him. I think that tells you just about all you need to know.


  1. In one of the articles to which I linked today, it is states that Erskine was known as the “hall monitor” and Dick Morris said Bowles was really nice to him. Ick.

    Comment by Fec — Monday, November 12, 2012 10:33 pm @ 10:33 pm

  2. Seldom mentioned is the interest paid on every dollar we borrow, those borrowed in the past, the present and every day for the forseeable future. Those payments go to creditors, but come from the general tax revenue. The burden of those interest payments will only grow as we borrow more. But hey, our children will not have to be concerned, right?

    Comment by mergatroyd — Thursday, November 15, 2012 5:29 pm @ 5:29 pm

  3. Poor mergatroyd, angst-riddenly unaware that the reason the interest is so seldom mentioned is because that IT IS SO LOW THAT IT IS NOT A PROBLEM (1.59% on 10-year notes as of today). Despite nominally huge deficits in recent years, interest on the national debt is at its lowest share of GDP in the postwar era. Keep in mind, too, that the deficit is falling as we speak.

    We don’t have a deficit crisis. We have a jobs crisis. The deficit is a problem, yes, but not one that must be dealt with decisively in the near term, whereas dealing with jobs decisively in the near term would ALSO help with the deficit farther down the road.

    And, finally, getting our health-care costs under control — just anything approaching the per-capita cost of other Western industrialized democracies would be fine — would have us at or within spitting distance of a balanced budget, EVEN IF WE DID NOTHING ELSE, for decades to come.

    Comment by Lex — Thursday, November 15, 2012 8:45 pm @ 8:45 pm

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