Congressman Tim Walz might support "entitlement reform" if congressional Republicans would entertaining a bigger tax bite on high wage earners, the Post Bulletin reports in Walz says he'd consider entitlement reform if GOP considers high earner tax boost.
Bluestem isn't sure that's a grand bargain for Greater Minnesota.
PB Political reporter Heather Carlson writes:
The fiscal cliff refers to a double whammy of tax increases and hefty spending cuts that automatically take effect on Jan. 1 unless Congress and President Barack Obama take action to stop it. The Congressional Budget Office has warned that those cuts could drive the country back into a recession.
Republicans have been making the case that entitlement reform needs to be part of any fiscal cliff solution. But Walz said before he is willing to consider changes to those programs, he wants Republicans to be open to raising tax rates on higher-income individuals. He said he can make the case that the lowered tax rates passed during President George W. Bush's tenure played a role in driving up the national debt.
He asked "So they are going to ask us to take a look at Social Security but they are unwilling to look at part of it that was part of the problem in the first place?"
Is this "grand bargain" such a great idea? Earlier this month Michael Lind addressed the big picture at Salon in The case against a “grand bargain”:
According to news reports, President Obama wants a “grand bargain” with the Republicans, who retain a majority in the House of Representatives even though in this year’s election more Americans voted for Democrats than for Republicans for Congress. The details of various “bipartisan” grand bargains vary, but most proposals, like the one proposed by the right-wing Republican Alan Simpson and the conservative Southern Democrat Erskine Bowles, the heads of the president’s failed deficit reduction commission, would trade modest Republican concessions on higher taxes on the rich for Democratic support for major cuts in Social Security, Medicare and other entitlements.
Any such grand bargain would be a bad deal for mainstream Americans.
Social Security and Medicare have absolutely nothing to do with the short-term U.S. fiscal problem. Middle-class entitlements do have long-term problems, like inadequate payroll tax revenue for Social Security in the 2030s, and excessive medical prices in the U.S., which affect private healthcare as well as Medicare and Medicaid. But these are unrelated problems that deserve to be discussed in unrelated debates according to unrelated timelines. . . .
Closer to home, the picture gets much worse. From a press release from the Minnesota AFL CIO:
According to a new report released by the AFL-CIO yesterday:882,408 Minnesotans could be negatively impacted if Congress attempts cuts to Social Security, including 115,780 people with disabilities and 59,076 children. Of the 879,145 Minnesotans who get their health care coverage from Medicaid, 422,219 children and 96,039 seniors could be affected if the lame duck Congress makes cuts to Medicaid benefits. Social Security, Medicare and Medicaid combined deliver $26 billion per year into Minnesota’s economy.
As the so-called “fiscal cliff” approaches, members of Congress have suggested cuts to benefits for Social Security, Medicare and Medicaid even while calling for renewing tax cuts for the richest 2%. If those tax cuts are renewed, the richest 2% in Minnesota would receive an average of $29,690 in tax cuts, while the rest of Minnesotans would receive an average of $1,370. The 2012 House Republican budget plan would cut federal support to Minnesota’s Medicaid program by at least $16.9 billion over 10 years.
Here's a pdf that accompanied the press release:MN-3
How does that breakdown for rural Minnesota, with its older populations and lower incomes for working families? A report issued by Social Security Works, a broad progressive partnership, Social Security, Medicare and Medicaid, Work for Minnesota includes helpful data that illustrates the potential impact.
Social Security Works for Minnesota’s Rural Communities
• Social Security is more important to rural Minnesotans than to other Minnesotans. One out of 5 (21.9 percent) rural Minnesotans received Social Security compared with 1 out of 7 (14.7 percent) non-rural Minnesotans in 2010.
• Social Security is more important to the local economies of Minnesota’s rural counties than to its non-rural counties. Total personal income in Minnesota’s 66 rural counties was $51 billion in 2010 of which $3.9 billion, or 7.6 percent, was from Social Security. By comparison, total personal income in the state’s 21 non-rural counties was $176 billion, of which $7.8 billion, or 4.5 percent, was from Social Security.
Broken down on the congressional district level, here's what that looks like:Minnesota Final 2012
Photo: The Grand Bargain looks like Garden Troll Zombies to Bluestem. Or that might be too much Netflix.
Blog begathon: Bluestem is supported by reader contributions. If you liked this post, consider throwing some coin to the tip jar. If you don't like using PayPal, email at the address on this page for a snail mail address. We'll be running our twice-yearly "bleg" though Christmas.