SOTU Reaction: Both Parties Ignore The Debt Monster

If you watched last night's State Of The Union Address, you wouldn't have had any idea just how serious a problem we're facing.

In one of his first reactions last night to the State Of The Union and Republican response, Ross Douthat noted with dismay that neither President Obama nor Paul Ryan said a word about the 800lb gorilla in the room:

If you were a visitor from Mars, watching tonight’s State of the Union address and Paul Ryan’s Republican response, you would have no reason to think that the looming insolvency of our entitlement system lies at the heart of the economic challenges facing the United States over the next two decades. From President Obama, we heard a reasonably eloquent case for center-left technocracy and industrial policy, punctuated by a few bipartisan flourishes, in which the entitlement issue felt like an afterthought

(…)

[Ryan’s] remarks, while rhetorically effective, were even more vague about the details of that reckoning than the president’s address. Ryan owes his prominence, in part, to his willingness to propose a very specific blueprint for addressing the entitlement system’s fiscal woes. But in his first big moment on the national stage, the words “Medicare” and “Social Security” did not pass the Wisconsin congressman’s lips.

Of course, Ryan wasn’t speaking for himself so much as he was speaking for the GOP as a whole, and the harsh reality is that his Roadmap, which is the only serious GOP proposal that addresses the long term debt problem, has not been endorsed by many Republicans and the leadership has noticeably not made it part of the overall Republican plan. The President, meanwhile, made it clear just yesterday that he would not entertain serious entitlement reform. This isn’t really surprising. If you look at the polls, it’s clear that Americans don’t have much of a stomach for entitlement reform, even though they seem to realize that we can’t continue on the way we’re going. It’s much easier for politicians to pander to voters than to lead on an issue like this, because the instant reaction of partisans on either side to any proposal related to Medicare or Social Security is to preach doom-and-gloom to the elderly and those nearing retirement age.

This isn’t the way that is has to be, of course, as I noted when the Debt Commission proposal came out in November:

If we lived in a country with adult political parties, the release of the Commission’s report would serve as the beginning of a long overdue national conversation about how to get our fiscal house in order. Liberals would recognize that social spending would have to be cut, and conservatives would recognize that defense spending cuts and tax increases would have to be on the table. Instead, what we’re likely to see is more of the same political gamesmanship — liberals accusing the GOP of wanting to starve Grandma, conservatives accusing liberals of just wanting to raise taxes so they can spend more. And the debt will continue to rise.

At some point we’re going to be forced to deal with these problems, but it’s not going to happen until we start feeling the pain that we could ward off if we’d just grow up already

The Debt Commission’s report provided an opportunity for the start of a national conversation on what is going to be the most important issue of the next decade. Instead of acting like adults, though, the report has largely gone ignored. President Obama could have used its ideas as a jumping off point for his address last night, but instead he didn’t mention it at all and repeated the same tired bromides about protecting Social Security and Medicare that we’ve heard from every President since the programs came into existence. Paul Ryan could have been more honest with the public but, because the leadership that he spoke for doesn’t want to touch entitlements, he glossed over the real cause of budget deficits and the National Debt. Last night was, in short, a profoundly missed opportunity. Something tells me that, in a few years, we’re going to look back and wish that they’d been more honest with us last night.

FILED UNDER: Deficit and Debt, US Politics
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010. Before joining OTB, he wrote at Below The BeltwayThe Liberty Papers, and United Liberty Follow Doug on Twitter | Facebook

Comments

  1. Axel Edgren says:

    Yeah, no one wants to deal with the painful stuff – the public get what it wants and deserves.

    Still, one party *at least* doesn’t act as if tax increases are evil on top of all this. GOP spending promises are ideologically motivated – everything that is good for the environment has to go and the only agricultural subsidies they want to stop are for organic farms (“Take that you faggy hippies who don’t want to eat pesticides!”). As usual, both sides are not very good, but one side is much worse.

  2. Davebo says:

    Ross Douthat noted with dismay that neither President Obama nor Paul Ryan said a word about the 800lb gorilla in the room:

    OK, so Ross missed the speech I guess. But you did live blog it didn’t you Doug? What’s your excuse?

    Now, the final step – a critical step – in winning the future is to make sure we aren’t buried under a mountain of debt.

    We are living with a legacy of deficit-spending that began almost a decade ago. And in the wake of the financial crisis, some of that was necessary to keep credit flowing, save jobs, and put money in people’s pockets.

    But now that the worst of the recession is over, we have to confront the fact that our government spends more than it takes in. That is not sustainable. Every day, families sacrifice to live within their means. They deserve a government that does the same.

    So tonight, I am proposing that starting this year, we freeze annual domestic spending for the next five years. This would reduce the deficit by more than $400 billion over the next decade, and will bring discretionary spending to the lowest share of our economy since Dwight Eisenhower was president.

    This freeze will require painful cuts. Already, we have frozen the salaries of hardworking federal employees for the next two years. I’ve proposed cuts to things I care deeply about, like community action programs. The Secretary of Defense has also agreed to cut tens of billions of dollars in spending that he and his generals believe our military can do without.

    I recognize that some in this Chamber have already proposed deeper cuts, and I’m willing to eliminate whatever we can honestly afford to do without. But let’s make sure that we’re not doing it on the backs of our most vulnerable citizens. And let’s make sure what we’re cutting is really excess weight. Cutting the deficit by gutting our investments in innovation and education is like lightening an overloaded airplane by removing its engine. It may feel like you’re flying high at first, but it won’t take long before you’ll feel the impact.

    Now, most of the cuts and savings I’ve proposed only address annual domestic spending, which represents a little more than 12% of our budget. To make further progress, we have to stop pretending that cutting this kind of spending alone will be enough. It won’t.

    The bipartisan Fiscal Commission I created last year made this crystal clear. I don’t agree with all their proposals, but they made important progress. And their conclusion is that the only way to tackle our deficit is to cut excessive spending wherever we find it – in domestic spending, defense spending, health care spending, and spending through tax breaks and loopholes.

    This means further reducing health care costs, including programs like Medicare and Medicaid, which are the single biggest contributor to our long-term deficit. Health insurance reform will slow these rising costs, which is part of why nonpartisan economists have said that repealing the health care law would add a quarter of a trillion dollars to our deficit. Still, I’m willing to look at other ideas to bring down costs, including one that Republicans suggested last year: medical malpractice reform to rein in frivolous lawsuits.

    It goes on, but I’d say he addressed the debt, the growing cost of entitlements and government spending in general fairly specifically.

  3. wr says:

    The “debt crisis” is a fraud used by right-wingers to slash the social safety net and keep taxes low for the rich.

    The answer is not British style “austerity,” but growth. Real growth. And that will require temporary investment.

    And how do I know this is true? Because no one screaming about the debt is willing to consider allowing the Bush-era tax cuts for the super-rich expire, despite how much their continuation increases the deficit.

    Put America back to work. Build roads and bridges and high speed rail. Fund our schools and our hospitals. And once people are earning money again, tax revenues will rise back to the needed level. And we won’t need to make life so much harder for the poor and old and sick.

    Unless, of course, that’s the real plan…

  4. Obama’s debt freeze is like using a sandbag to try and stop the rushing river.

    Cut all spending across the board to 2008 levels. Then institute a freeze. And that would just be the beginning

  5. Axel Edgren says:

    Yeah, but the president has to include the special words that truly prove he is as Serious and Statesmanlike as Douthat desires. He can’t just say the deficit is bad and needs to be reduced. He also has to channel Saint Raygun and Sir Winston and speak of thrift and tightened belts and maybe weep a little.

    Douthat is a comfy white male and he is thus automatically qualified to decide who is worthy and who is not.

  6. Rick DeMent says:

    Until tax increases on the wealthy are on the table the whole discussion about “debt” is worse then stupid. The GOP is breathlessly protecting the class that caused the banking crisis and was bailed out by taxpayers and they now balk at ponying up and extra 4%?

  7. EJ says:

    “And how do I know this is true? Because no one screaming about the debt is willing to consider allowing the Bush-era tax cuts for the super-rich expire, despite how much their continuation increases the deficit.”

    This was already done in the healthcare bill. A 3.9 percent “medicare surcharge” was placed on incomes over 200k. That is exactly the percent that bush tax cut was on the top bracket. So the Bush tax cuts for the “super rich” have alreadry been reversed. Thing is it was alreayd spent away.

    Depending on what state and city you live in, the top marginal tax rate is now between 38.9 and 50.9 percent.

  8. wr says:

    EJ — You are, of course, conflating state, federal and local taxes. Probably tossing in property and sales taxes, too…

    Let me know when you want to have an honest discussion on the issue.

  9. G.A.Phillips says:

    lol, Doug “Obama’s debt freeze is like using a sandbag to try and stop the rushing river. ” More like a global flood……

    http://www.usdebtclock.org/

  10. Obama addressed the debt crisis by claiming he has a goose that lays golden eggs. Lots of them.

    Yeah, that’s the ticket.

  11. EJ says:

    Wr,

    Do you know how to read? I believe I just said if you add all the levels of income tax together you get that rate:

    “Depending on what STATE AND CITY YOU LIVE IN, the top marginal tax rate is now between 38.9 and 50.9 percent.

    I am very much including state, federal and local inome taxes. What I said is true. For large chuncks of the country, the “super rich” are already paying at or near 50% of inocme on the margin.

    And you also ignored my main point, which is that the bush tax cuts at the federal level have already been reversed – but instead of democrats using them to lessen the deficit, the alleged reason why they think those cuts were so evil in thew first place, they spent all the revenue away already.

  12. EddieInCA says:

    “Doug Mataconis says:
    Wednesday, January 26, 2011 at 14:05

    Obama’s debt freeze is like using a sandbag to try and stop the rushing river.

    Cut all spending across the board to 2008 levels. Then institute a freeze. And that would just be the beginning”

    Doug –

    With all due respect… Why 2008? Why not 2000, before Bush and a GOP congress increased the debt and turned surpluses into deficits?

    And why not return Taxes to 1993 levels, when we starrted the biggest economic boom in recent history?

    Why is it always on the spending side that things have to be frozen?

    Seems to me that we could easily get out of our current situation by just having a REASONABLE progressive income tax system… You know, the one that worked great until the middle of the 1980’s….

  13. ponce says:

    “Look to Iraq, where nearly 100,000 of our brave men and women have left with their heads held high.”

    204 Iraqis killed and 818 wounded in this week’s political violence.

    It’s not a bomb in Russia, but worth a mention.

  14. c.red says:

    I think the verdict is in on the British austerity measures –

    http://www.nytimes.com/2011/01/26/world/europe/26britain.html?_r=1

    And, hey Republicans want us to go the same route.

  15. wr says:

    EJ — I’d love a link with this information about the super-secret tax hike that no one in thecountry knows about — or brought up during the debate over the tax cuts.

    And if they are paying near 50% on the margin — am I supposed to feel sorry for them? One of the great problems with our current tax code is that we don’t have any brackets above the roughly 250k level. The country would be in better shape if they went up sharply from here — up to about 90% on anything over ten million. There’s a lot less incentive to loot companies and steal from the workers that way…

  16. mantis says:

    And, hey Republicans want us to go the same route.

    Actually, what they want is much worse.

  17. john personna says:

    Doug, ignoring the freeze in your OP, and then discounting it … is not only crazy, it is not productive.

    What you really want to do is say “thank you for that freeze proposal, let’s do that ASAP, and then move on to MORE fixes.”

    This is the worst kind of ideological blindness.

  18. Axel Edgren says:

    “And why not return Taxes to 1993 levels, when we starrted the biggest economic boom in recent history?”

    That wouldn’t be good either. Can’t hit people with a sizable tax hike just like that.

  19. sam says:

    @Doug

    “Cut all spending across the board to 2008 levels. Then institute a freeze. And that would just be the beginning”

    A meager beginning. The real driver of the deficit is healthcare, specifically Medicare. Unless and until that monster is addressed, not much headway will be made. The only person I know of who’s put forward a serious proposal to tackle the problem is Paul Ryan. I don’t like his proposal (I think seniors will less well off under it than they are the current Medicare regime, much less well off), but it’s a serious attempt. I don’t really credit any pol, Democrat or Republican, who blathers on about the horrors of the deficit, but says zip about Medicare.

  20. wr says:

    Except that Ryan’s plan is a complete fraud. It doesn’t balance the budget until something like 2070, guts Medicare… and gives tax breaks to rich people. Just because he says it’s a serious plan doesn’t make it one.

  21. sam says:

    No, it’s a serious plan in that it does attempt to address the problem. I’m only speaking about his Medicare proposal. I don’t think it’s a good plan, but it is serious. I will note, though, that he was mum about Medicare in his response last night.

  22. An Interested Place says:

    “I will note, though, that he was mum about Medicare in his response last night.”

    In much the same way that Republicans actually bashed Democrats on the same subject in the last election…we are told by the GOP that tax cuts are completely off the table and that the budget must be cut…but if they won’t even touch the programs that consume most of the federal budget, how exactly are they going to attempt to balance it? The fact of the matter is that politicians of either party aren’t really going to address our budget problems in a serious way until they absolutely have to…and the fault for that doesn’t lie solely with them…in polls, the American people talk a good game about wanting to fix the budget deficit, but they don’t seem very willing to take the necessary steps to do that…

  23. An Interested Party says:

    Hmm…some kind of Freudian slip, I guess…

  24. wr says:

    Yes, Ryan is serious about Medicare. He’s serious about destroying the program. Should we reward him for this?