Social Security Cuts Are a Losing Proposal For Obama
President Obama will propose a plan to cut Social Security benefits as an attempt to come to some form of an agreement with congressional Republicans. An anonymous White House official explained Friday that the cuts would amount to $1.8 trillion over the next decade. However, these plans will make Obama fail to appeal to either party in Washington.
To account for the proposed cuts, the president will offer more taxing on higher income Americans. As expected, Republicans will most likely block any plan for tax increases. In addition, any reform to social welfare programs will not sit well with the Democrats. Based on the likelihood of overwhelming opposition, Obama can be facing yet another failed budget proposal among a divided government.
House Speaker John Boehner (R-Ohio) instantly rejected the plan Friday, claiming that Obama’s entitlement cuts are too modest. Boehner and the rest of the GOP will not agree to even more tax increases, and will result in little support toward the Obama administration. However, Boehner surprisingly pitched a tax hike for the wealthy in December 2012, in exchange for entitlement cuts for programs including Medicare and Medicaid. During the bipartisan conflict of negotiating deals surrounding the fiscal cliff, he also offered support on a Democrat-sponsored plan to measure and eliminate inflation. Known as “Chained CPI”, the formula has come under fire to critics in that it underestimates the true impacts of inflation. Due to its complex methodology, the proposed plan has become increasingly controversial.
To both Democrats' and Republicans' dismay, a tradeoff needs to occur somewhere. With any form of budget cuts, revenue needs to be collected elsewhere. If that means taxing wealthier Americans then so be it. Many Americans appear to remain in the dark on the severity of the current economic deficit. The bottom line is that cuts need to be made no matter if they lack support. The reality is that any counter-offer will result in some form of opposition when dealing with the constant gridlock in Washington. Compromise needs to happen somewhere, but getting there will be the real challenge.