The Obama administration on Friday previewed the budget it will submit to Congress next week. According to reports at The Hill newspaper and the Washington Post, President Obama’s budget will include cuts to Social Security – via so-called chained Consumer Price Index adjustments, or chained CPI – as well as some means-testing and spending reductions in Medicare. Obama’s budget also will include another round of tax increases.
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“Less than 100 days after he successfully raised taxes on the most productive Americans, President Obama wants to continue to sabotage economic growth with more taxes. When we see light at the end of the tunnel, Obama adds more tunnel.”
Professor of Economics
Policy Advisor, Economics
The Heartland Institute
“President Obama is caught in a bind on entitlement reform thanks to the increasing radicalism of his own party on the issue. While the president might like to play to the political center – everyone understands that our current entitlement system is unsustainable – his own base of support is so opposed to even the most modest reforms that any attempt on his part to engage in negotiation on means testing or adjusting benefits is viewed as a betrayal of deeply held principle.
“The president is reaping what he sowed by turning what should be rational, even-handed discussions into political death matches over the past four years: a climate in Washington that makes any grand bargain which includes true reform of entitlements impossible in his presidency.”
Research Fellow, The Heartland Institute
Managing Editor, Health Care News
“Chained CPI is just another means for government to lie about the true rate of inflation. Basically, chained CPI says people can substitute lower-price items if other items go up in price, so there’s not really inflation – buying margarine if butter goes up in price, for instance. Following the logic of chained CPI, if the price of steak goes up, people can buy hamburger; if the price of hamburger goes up, people can buy chicken; if the price of chicken goes up, they can buy eggs. Eventually we’re down to no inflation as long as there are dead possums along the side of the road that people can bring home for dinner.”
Research Fellow, Budget and Tax Policy
The Heartland Institute
Budget & Tax News
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