CBPP Destroys Catfood Commission Dems’ Plan for Deficit Reduction
Robert Greenstein of the Center on Budget and Policy Priorities has not been traditionally opposed to a deficit reduction plan. The CBPP supports chained CPI, for example. So it’s quite something to see Greenstein, along with Paul van de Water and Richard Kogan, savage the Democratic opening bid in the Catfood Commission II, describing it as to the right of Bowles-Simpson, the Gang of Six and other deficit plans.
The new deficit-reduction plan from a majority of Democrats on the congressional Joint Select Committee on Deficit Reduction (the “supercommittee”) marks a dramatic departure from traditional Democratic positions — and actually stands well to the right of plans by the co-chairs of the bipartisan Bowles-Simpson commission and the Senate’s “Gang of Six,” and even further to the right of the plan by the bipartisan Rivlin-Domenici commission. The Democratic plan contains substantially smaller revenue increases than those bipartisan proposals while, for example, containing significantly deeper cuts in Medicare and Medicaid than the Bowles-Simpson plan. The Democratic plan features a substantially higher ratio of spending cuts to revenue increases than any of the bipartisan plans.
CBPP rightly notes that none of this has led to Republicans embracing the plan. This calls into question why Democrats would make this kind of bid in the first place, with all the potential negative consequences down the road.
But back to the numbers. It’s mostly explained in this table:
As you can see, the Catfood Commission Dems’ plan has $92 billion more in cuts to Medicare and Medicaid than Bowles-Simpson, and $800-$900 billion less in revenue increases. Discretionary program cuts are comparable to Bowles-Simpson and the Gang of Six. All told, this is as high as a 6:1 ratio of spending cuts to revenue increases for the Catfood Commission Dems’ plan, compared to 2:1 for Bowles-Simpson and the Gang of Six.
None of this is to say that Bowles-Simpson and the Gang of Six were at all good ideas. But the Catfood Commission Dems’ plan is really draconian. Here’s another excerpt from the CBPP analysis:
The Democratic plan has $200 billion in Medicare beneficiary cuts, a level that exceeds the beneficiary cuts in Bowles-Simpson (the Gang of Six is not specific on this point) and is eight times the level of Medicare beneficiary cuts in the budget plan that President Obama released on September 19. Since half of Medicare beneficiaries have incomes below about $21,000, it would be extremely difficult to secure $200 billion in savings from increased Medicare beneficiary charges without requiring significantly larger out-of-pocket payments by beneficiaries with incomes as low as $12,000 or $15,000.
Again, this didn’t lead to anything approaching a deal from the Republican side. It just became the new “left” pole in the debate. And it’s a pole significantly to the right of plans that had Republican participation in the recent past.