Social Security and Benefit Cuts in the Times

Three remarkable articles appeared in the NYT in the past two days. They're worth triangulating.

The first, by David Brooks, argues that Democrats are hypocritical not to support the Bush administration's proposed benefit cuts to Social Security. President Bush proposes to progressively index Social Security benefits, with the largest cuts going to people at the top of the wage scale. According to Brooks, this has been a Democrat idea for some time, and the Dems' opposition to it shows that they're less interested in promoting policy than in foiling the administration. This isn't necessarily bad news for the GOP, since it's a sign that Democrats are on the way to becoming an irrelevant opposition party, like the Tories in Britain.

The second, by Paul Krugman, appeared in today's Times. I loved this one. Krugman puts the smack down on Brooks and other conservatives' championing of the President's newfound populism by juxtaposing the proposed benefit cuts with the Republicans' earlier tax cuts. Not only do middle-class workers (say, those making $60,000 a year) face far steeper cuts in their Social Security benefits than they've received in tax cuts, but (surprise, surprise) millionaires' gains from tax cuts far outstrips their losses in Social Security.

This was the best moment of Krugman's article: "Suppose, finally, that you're making $1 million a year. You received a tax cut worth about $50,000 per year. By 2045 the Bush plan would reduce benefits for people like you by about $9,400 per year. We have a winner!" Another gem: "(T)o avert the danger of future cuts in benefits, Mr. Bush wants us to commit now to, um, future cuts in benefits. This accomplishes nothing, except, possibly, to ensure that benefit cuts take place even if they aren't necessary."

The third article isn't about Social Security, but Medicaid, which looks to get cut by about $10 billion over the next five years. This isn't coming directly from the Bush administration, but from the cash-strapped states. I always thought this was one of Howard Dean's better arguments during the 2004 campaign: that due to lack of federal funding for state-administered programs, lower- and middle-class Americans actually faced tax increases under the Bush administration, and that when benefits were cut, they invariably hit lower- and middle-class families hardest.

But here, too, there's a funny version of Republican "progressive cuts":

Under current law, Medicaid officials cannot charge co-payments to pregnant women and cannot charge for specific services like family planning and emergency care. For other services, the maximum co-payment is generally $3.

"These rules, which have not been updated since 1982, prevent Medicaid from utilizing market forces and personal responsibility to improve health care delivery," the governors say in the latest version of their policy statement.

Governors seek "broad discretion" to set premiums, co-payments and deductibles, subject to certain limits. Congress, they say, could establish "financial protections to ensure that beneficiaries would not be required to pay more than 5 percent of total family income."

A more modest proposal, the governors say, is to charge higher co-payments to families with incomes above certain levels, say $22,000 a year for a family of three. Or, they say, states could charge co-payments to deter the overuse of specific services, including inappropriate use of hospital emergency rooms.

Talk about "market forces." I guess Brooks would argue that the Democrats should cheer any proposal that would make pregnant mothers making more than $22,000 pay their fair share. After all, the repeal of the estate tax led analysts to start distinguishing between the rich and the super-rich; maybe Medicaid cutbacks will force us to distinguish between the poor and the super-poor. If you're just poor, then it's high time to learn personal responsibility. There's no better way to learn that than to be told to fork over 5 percent of your income when you take your kid to the emergency room and they turn out not to be as sick as you thought.