WASHINGTON (AP) — Deep divisions among Senate Democrats over whether cuts to popular benefit programs like Medicare and Medicaid should be part of a plan to slow the government’s mushrooming debt pose a big obstacle to a deal for avoiding a potentially economy-crushing “fiscal cliff,” even if Republicans agree to raise taxes.
Much of the focus during negotiations seeking an alternative to $671 billion in automatic tax increases and spending cuts beginning in January has centered on whether Republicans would agree to raising taxes on the wealthy. President Barack Obama has insisted repeatedly that tax increases on the wealthy must be part of any deal, even as White House officials concede that government benefit programs will have to be in the package too.
“It is the president’s position that when we’re talking about a broad, balanced approach to dealing with our fiscal challenges, that that includes dealing with entitlements,” White House press secretary Jay Carney said Tuesday, referring to the mammoth benefit programs.
But even if GOP lawmakers agree to raise taxes, there is no guarantee Democrats can come up with enough votes in the Senate to cut benefit programs — as Republicans are demanding.
“I hope not if it means Social Security or Medicare benefit cuts,” said Sen. Sheldon Whitehouse, D-R.I.
There’s a growing consensus among Senate Democrats and the White House that Social Security should be exempt from any deficit-reduction package.
But some centrist Democrats in the Senate argue that fellow Democrats must be willing to consider cuts to Medicare and Medicaid in order to get concessions from Republicans on taxes.
“It has to be both — a significant revenue increase as well as spending cuts,” said Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee.
Sen. Kent Conrad, D-N.D., who is retiring as chairman of the Senate Budget Committee, said rising health care costs in Medicare and Medicaid are helping to drive future spending, making them an essential part of a long-term deficit-reduction package.
“I’ve been part of every bipartisan group here. We’ve always put everything on the table,” Conrad said. “If you’re going to solve this problem, you’re going to have to deal with where the spending is and the revenue can be raised.”
But senators like Baucus and Conrad increasingly are being drowned out by other Democrats emboldened by the recent election results to fight against benefit cuts.
Sen. Tom Harkin, D-Iowa, said he is willing to find savings in Medicare and Medicaid by making them more efficient. But, he said, he won’t support benefit cuts.
“I think the election spoke very strongly about the fact that the vast majority of American people don’t want to cut these programs,” Harkin said.
Congress and the White House are devoting the next three weeks to finding at least a bridge over the fiscal cliff by reducing the sudden jolt of higher taxes and spending cuts in January while laying a framework for addressing the nation’s long-term financial problems next year.