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Win First, Compromise Later

Ramesh Ponnuru lays out an agenda on tax reform and Social Security reform that he hopes Obama and congressional Republicans can unite behind.  I can maybe see a deal along the lines Ponnuru lays out for tax reform, but I don't see the Democrats getting behind Ponnuru's idea of creating a more progressive, but (in absolute terms) smaller and more sustainable Social Security program at the current level of taxation.  I don't think that the vast majority of Democrats (very much including the President) are going to give the Republicans anything in return for the Republicans giving up on the idea of private accounts within Social Security.  The President told us in the State of the Union what he wants for Social Security (though he told us by a process of elimination.)  He wants to finance the current system through higher taxes - though he won't come out for the tax increases until after he is safely reelected. 

The thing is I don't think that the Democrats will come out for a Social Security deal like the one Ponnuru outlines unless they think that's the best deal they can get long-term.  I think that the current leaders of the Democratic Party in Washington (Obama, Pelosi, Reid) think they can get a better deal just by hanging tough, stalling, and demonizing any Republican plans for reform.  Like I've said, I think the Democrats think that if it comes to a fiscal crisis, they'll be in a strong position to bargain for a deal composed primarily of tax increases and greater government control over the health care sector. The Democrats will be more ready to deal after they feel like they've been defeated on domestic economic issues.  They don't feel like they've been beaten.  They feel like they were the victims of temporary bad timing. That means the most you are likely to get from them on Social Security is a plan to deal with the funding shortfall with some kind of consumption tax rather than higher marginal taxes on earnings.  No deal.

That doesn't mean that Ponnuru's ideas aren't worth talking about.  I think they could be an important part of a Republican reform agenda.  A Social Security program that is a better deal for lower earners and offers higher earners lower taxes during their working lives in return for (somewhat) lower Social Security benefits is a plausible program (especially when contrasted with a Democratic program of higher taxes and government control of health care.)  But I doubt such a program will be the basis for a compromise on Social Security in the next five years, unless Harry Reid is the Senate Minority Leader and there is a Republican President.  The Washington Democratic leadership will only compromise social democracy away after they are sure they can't have it.

But nothing lost in trying for that compromise.

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Discussions - 2 Comments

Thanks for the link. I don't see most of these things happening either. My point is that the Democrats could have bipartisan achievements if they were willing to compromise.

True, but I think that Democrats would recognize the kind of compromises that you offer as the kind of compromises that Democrats would only accept if they felt themselves to be in a position of weakness. In the same way, the only compromises that they (and I mean the senior Washington leadership of the Democratic Party) are willing to accept at the moment are ones that are premised on Republican and conservative weakness.

I do get the narrative that you are trying to push back against where liberal writers, politicians, etc. argued that the stimulus and Obamacare WERE moderate bipartisan compromises and the Republicans just wouldn't play their part. They said "See, we gave up single-payer [for the moment]. The least you can do is support our plan for a individual health insurance purchase mandate, a new middle-class entitlement, guaranteed issue, community rating, and mandated comprehensive prepayment of medical services through the private "insurance" system. We'll even let you decide whether this new system is paid for with new consumption taxes or higher payroll taxes." Most conservatives (though not David Frum) recognized this as liberals talking to themselves rather than really compromising. I suspect liberals hear the same thing when they hear conservatives offering to give up on private accounts in Social Security in return for lower benefits for future high earners (which most liberals hear as "Social Security cuts") and no tax increases.

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