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Who Pays For The ‘Grand Compromise’?

George Zornick writing at The Nation has done a good job of enumerating who it is that will foot the bill for Obama’s grand compromise. An amazingly ‘bipartisan’ compromising of principle that has given Boehner and the Republicans 98% of what Boehner was demanding as their share of ‘sacrifice’.

…as Brookings Institution senior fellow William G. Gale writes, “Low- and middle-class households have seen stagnating or declining earnings over the past few decades, and they have been hit hard in the Great Recession by the housing market collapse and the job market collapse. Now, they are being asked to shoulder—via spending reductions—all of the fiscal reduction agreed to so far.” (Yes, that Brookings Institution).

Veterans: Almost half of the first round of cuts will come from “security spending,” which includes the Pentagon budget but also the Department of Homeland Security, the State Department and notably veterans benefits and compensation. The White House assured veterans they won’t be harmed if the trigger is pulled, but did not assure them they are safe from any of the preceding cuts. More than 2.2 million veterans have served in Iraq and Afghanistan since September 11, 2001, many of whom have been seriously injured and require extensive care. The Disabled Veterans of America already has said it is “anxious” to see how these spending cuts are assembled.

Students: Graduate students would be the hardest hit, as the bill proposes an elimination of the interest subsidy on federal student loans for “almost all” of them. This means that beginning July 1, 2012, grad students will be responsible for the interest on their loans while in school and during any subsequent deferment period. Also, while the federal government currently offers subsidies for on-time payments in order to promote responsible pay-backs, they will be eliminated under the debt ceiling deal. Also, education accounts for the largest share of non-defense discretionary spending. It’s nearly inconceivable that budget-cutters won’t target that juicy budget line in making their cuts.

Seniors: As noted, Medicare is subject to across-the-board cuts in the super-committee, and if the trigger is pulled, provider payments will be slashed—though only up to 2 percent. The makeup of the super-committee and outside-the-Beltway campaigns to protect Medicare will determine a lot about the degree of cuts, but remember that inside the Beltway, the “left” side of the debate has been defined by President Obama and the Gang of Six as raising the eligibility age to 67 and/or $500 billion in cuts. So this probably won’t end well.

The poor: Again, Medicaid will be subject to cuts by the super-committee. The Republican position, articulated in the Ryan budget, is a devastating 35 percent reduction in the next ten years, even as health costs rise. (However, Medicaid is protected from any cuts if the trigger should go off). Beyond that, federal housing assistance is the fourth largest slice of non-defense discretionary spending and is thus a likely target for cuts.

The unemployed: Unlike what happened during the December showdown over the Bush tax cuts, the White House was unable (or unwilling) to secure any extension of help for the jobless. That December extension will expire at the end of this year, and this was one of the last best shots to make sure that 3.8 million people won’t lose their benefits at that point.

More at The Nation…
Who’s Helped and Who’s Harmed By Debt Deal?

George Zornick, August 01, 2011

So, who did this to you?

The House of Representatives has passed the deficit reduction bill. The vote: 269 to 161.

Update: Here’s the roll call vote: The ayes and noes.The Democrats are in italics.

Kudos to Colorado Congresswoman Diana DeGette for voting against the bill. Same for Dennis Kucinich, Barney Frank, Bobby Scott, John Conyers, Charlie Rangel and Zoe Lofgran.

Nancy Pelosi voted for the bill.

Hat tip to Jeralyn @ Talkleft

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