Thursday, January 08, 2009
Obama may propose severe retiree entitlement cuts to balance economic stimulus package
There are numerous media reports that Barack Obama, who gave the stirring speech today at George Mason University, will have to propose drastic cutbacks in entitlements to retirees in both Social Security and Medicare.
The stories are not real specific, other than for suggesting the obvious possibility of raising FICA and Medicare tax rates on wages and extending the wage base in various ways (possibly with a doughnut hole).
There could be more rapid increases in full retirement age. There could be proposals for means testing, against other income or even assets (which turns social security from a pseudo-investment annuity into a socialistic scheme to redistribute wealth, always something very politicized). There could be pressure on existing seniors, already retired, to reconsider new careers that they don’t want.
There could also be some kind of rationing of procedures in Medicare, in relation to age, or in relation to the availability of filial family support. There could be strengthening of lookback periods in Medicaid even further, or outright filial responsibility laws at the federal level.
All of these horrors are at least possible.
The Washington Times has a front page story Jan. 8 by David R. Sands and Catherine Bellantoni, with Kara Rowland and Patrice Hill, “Entitlements on the lone as deficits rise: Obama pledges reform after party hinders Bush,” link here.
The New York Times has a front page story Jan. 8 “Obama promises bid to overhaul retiree spending; Huge deficits looming; potential for risky fight over Social Security and Medicare,” link here.