If You Can’t Stand the Heat… – Washington has been experiencing a heat wave, but it can’t all be blamed on the friction between the two parties. Before members of the House can escape at the end of the week for a long break, they must complete work on the war supplemental that has bounced around more than a beach ball. The Senate will stay an extra week before its month-long recess and will try to complete a small business measure amid votes on the Elena Kagan nomination to the Supreme Court, campaign finance reform, and energy legislation.
At a time when Social Security is increasingly getting lawmakers' attention for the possibility of reform, raising the retirement age is starting to emerge as one of the more palatable options. Coincidentally, the Urban Institute held an event on it recently at the exact same time the Senate held a hearing about older Americans' participation in the labor force.
Social Security has been described as the "third rail" of American politics: if you touch it, you get burned. Now, it seems that touching Social Security might be becoming as easy for lawmakers as picking strawberries.
Last Friday, CBO released a report on 30 options for changing the Social Security system, analyzing both the savings and distributional effects of the options. After CBO released such dismal long-term budget projections last Wednesday (see our analysis here) showing that population aging is set to become the largest driver of entitlement spending through 2035, surely any real reform to our country's finances over the medium- and long-term must make changes to the largest single government program.
The report first focuses in the imbalance between projected revenues and outlays (actually, CBO even expects Social Security deficits to begin this year).
After the Fireworks – The Independence Day celebrations have concluded. The fireworks have fizzled and most of us are back to work. Capitol Hill is quiet after its own pyrotechnics last week as lawmakers tried to finish work on some contentious issues before its recess this week. It failed to get many of its tasks fully completed as disagreements on how to fund legislation continued to bog down the agenda.
After much anticipation, the CBO has released its Long Term Budget Outlook, which gives the first glimpse at the long-term effects of the recently-enacted health care legislation. In the report, which was released at the third meeting of President Obama's fiscal commission, the extended-baseline scenario (current law) shows drastic improvement from last year's outlook, but the alternative scenario, which is composed of policies more likely to occur, shows a shocking amount of debt.
Here are the highlights from this weekend’s editorials on fiscal and budget policy:
The establishment of a fiscal commission either in Congress or by the President was attacked from both sides of the political spectrum. Liberals thought that the group would be cover for cutting entitlement programs, while conservatives thought the commission would be a cover to raise taxes. When President Obama's National Commission on Fiscal Responsibility and Reform came to be, both sides wanted to fence off different options for consideration. And it continues to happen.