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Obama is Coming to Cut Medicare

I don’t want to be entirely cynical about President Obama’s jobs speech yesterday. Some of the ideas in his proposal, like the money to fix up old schools, are great. He is finally at least putting his rhetorical focus on the issue the American people actually wanted him to be talking about this whole time. If the package Obama outlined last night was actually a compromise that Obama got the Republican Congressional leadership to agree to, I might even consider this fairly poorly designed plan a decent deal.

The problem, though, is that this jobs package isn’t going to pass, so this speech wasn’t about policy, it was about messaging. Seen from that perspective, the speech was very scary to me as a progressive, because in the middle of what should have been a speech about getting Americans back to work, Obama very publicly endorsed putting Medicare and Medicaid on the deficit-reduction chopping block. Most important, Obama signaled he supports reducing Medicare spending that “some in his party” won’t like. From Obama’s Speech:

This approach is basically the one I’ve been advocating for months.  In addition to the trillion dollars of spending cuts I’ve already signed into law, it’s a balanced plan that would reduce the deficit by making additional spending cuts, by making modest adjustments to health care programs like Medicare and Medicaid, and by reforming our tax code in a way that asks the wealthiest Americans and biggest corporations to pay their fair share.  (Applause.)  What’s more, the spending cuts wouldn’t happen so abruptly that they’d be a drag on our economy, or prevent us from helping small businesses and middle-class families get back on their feet right away.

Now, I realize there are some in my party who don’t think we should make any changes at all to Medicare and Medicaid, and I understand their concerns. But here’s the truth: Millions of Americans rely on Medicare in their retirement.  And millions more will do so in the future.  They pay for this benefit during their working years. They earn it. But with an aging population and rising health care costs, we are spending too rapidly to sustain the program.  And if we don’t gradually reform the system, while protecting current beneficiaries, it won’t be there when future retirees need it. We have to reform Medicare to strengthen it.


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This statement from Obama is, of course, a deception on the part of Obama to act like Congressional liberals are unreasonable when it comes to Medicare. Progressives support ways to reduce Medicare spending by things like allowing Medicare to directly negotiate for drug prices. Progressives just don’t support shifting costs onto old people. Obama saying he supports Medicare changes “some in his party” won’t like is code for saying he will support cutting benefits.

Most of the jobs parts of the speech are unlikely to pass, so on the policy front they won’t really matter much. On the other hand, there is a Super Committee currently empowered to make large deficit reductions, so this one part of the speech about cutting Medicare benefits could be the only policy from the speech that is enacted.

I fear all that may result from this speech is that Obama gets a campaign message about how the Republicans don’t care about jobs, and Obama helps the Super Committee raise the Medicare retirement age.

Jon Walker

Jon Walker is political writer and blogger for FireDogLake. He is an expert on health care policy and the politics of health care reform.

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