The Wall Street Journal is reporting that Democrats may offer a measly $20 billion in budget cuts for the remainder of fiscal year 2011. That’s like me cutting a trip to McDonald’s to save my family budget.
Republicans in the House have passed a budget cutting $61 billion, which isn’t enough considering the $1.65 trillion deficit, but it’s a good start. Democrats won’t have any of it. They’ll return from another week of vacation to try to hammer out a deal. Then comes the debate over the debt ceiling. Republicans first want to vote on a balanced budget amendment before any debt ceiling vote. We’ll have to see who wins this battle.
Then it’s on to the FY 2012 budget. Republicans want even more drastic cuts, including entitlement reform. Of course, Senate Majority Leader Harry Reid won’t even consider changes to Social Security.
It would not only set targets for cuts but call for an overhaul of the tax code and changes to entitlement programs, including Social Security. The group hopes to get broad support by including elements that each party likes and dislikes.
But on Monday, Senate Majority Leader Harry Reid (D., Nev.) is scheduled to join a Capitol Hill rally by Social Security advocates, a signal that he will fight any changes to the retirement program. Mr. Reid’s position is potentially a significant problem for efforts to create a broad deficit-reduction package, as many Republicans say Social Security should be part of any deal.
A few weeks ago Reid said he won’t consider any reforms of Social Security for twenty years. He’ll be ninety one and the program will be in crisis at that time.
While Social Security is technically flush with a $2.5 trillion surplus — amassed since the retirement program was last overhauled in the 1980s — that money is projected to run dry in 2037, six years after Reid says he’s willing to consider changes, and that’s only if the government pays back its IOUs after raiding the trust fund.
By 2037, Social Security would collect enough in payroll taxes to pay out about 78 percent of benefits, according to the Social Security Administration.
Nothing like leaving a mess for others to clean up.
Back to the budget, and the possibility of a government shutdown if the two sides can’t come to agreement. It’s the Democrats who failed to pass a budget for FY 2011. They were supposed to do so last year when they controlled both the Senate and the House, and they failed. Now the Republicans in the House have passed a budget, and the Democrats have rejected it. If government shuts down, it will be the Democrats’ fault.
Memeorandum now has a thread and linked.
Update: The Page linked – thanks!