Liberal Groups To Offer Deficit Reduction Plans, But Will Conservatives Listen?

Two sets of progressive policy groups are issuing plans for deficit reduction this week.

On Monday, the progressive policy organizations Demos, the Economic Policy Institute and the Century Foundation will unveil a liberal blueprint. Their report says that unlike the centrist plans, this version “stabilizes debt as a share of the economy without demanding draconian cuts to national investments or to vital safety net programs.” It would, however, leave the debt at a higher level as a share of the economy than the centrist plans.

On Tuesday, a separate coalition of liberal groups, economists and labor leaders — the Citizens’ Commission on Jobs, Deficits and America’s Economic Future — will release a similar outline.

Here are some of the differences between the liberal plans, and the conservative and centrist plans outlined by President Obama’s fiscal commission and certain members of Congress.

• Timing. While other debt-reduction plans would take effect as early as 2012, the progressives oppose any austerity measures until perhaps 2015, once unemployment is at or below 6 percent.
• Stimulus spending. Most of the plans call for immediate additional stimulus measures, arguing that they will help create tax-paying jobs and reduce spending for relief to the jobless. But the liberals seek more spending in the short and long term: for now, financing for unemployment assistance, public works projects and aid to state and local governments to prevent continued layoffs of teachers and other employees, and for years beyond, “pro-growth investments” in areas like education, infrastructure, child care, rural broadband and scientific research.
• Military spending. All the plans would reduce projected spending for the military, but the liberal plans would cut deeper.Health care cost constraints. Congressional Republicans, including Representative Paul D. Ryan of Wisconsin, who has a comprehensive conservative plan, would repeal the new health care law. Mr. Ryan would also privatize Medicare, Medicaid and Social Security in the future. In contrast, the liberal and centrist plans would expand on the new law’s long-term savings policies.
• The liberal plans, however, would rely more on limiting payments to doctors, hospitals and other care providers and less on increasing out-of-pocket costs for beneficiaries, except for upper-income people. The liberals also call for a public option to compete with private insurers in new exchanges for consumers, and for the government to negotiate with pharmaceutical companies for lower prescription-drug prices.
• Social Security. While centrist plans would raise payroll taxes for the affluent and reduce benefits scheduled for many new retirees in future decades, the progressive plans would only raise taxes to make the program solvent until late in the century.

By: Alan

Alan Colmes is the publisher of Liberaland.