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Obama And Entitlements

Barack Obama hasn't been getting much love from the liberal blogosphere for suggesting that Social Security poses a long-term fiscal problem for the federal government (see Paul Krugman, Ezra Klein, and Matt Stoller, among others). Obama's critics note, correctly, that it's Medicare, not Social Security, that's responsible for the bulk of the entitlement crunch we face (Jon Chait also made this point recently), and that the bulk of that problem is that health-care costs are rising rapidly. Insofar as Obama is concerned about entitlement spending, they argue, he should be talking about ways to lower health-care costs, rather than discussing possible reforms to Social Security.

That seems like sound logic--except there's no reason to believe Obama thinks it's wise for the federal government to use policy tools like global budgets or large-scale price bargaining with providers to lower the cost of health care. One of his main health-policy advisers is David Cutler, the former Clinton administration economist who's among the most prominent center-left opponents of aggressive cost control. Obama's plan includes some less ambitious cost-control ideas (which Cutler describes here), but nothing beyond that--quite possibly because he thinks, as Cutler does, that medical innovation would suffer.

If Obama is resigned to a relatively expensive health-care system, in which health expenditures account for an ever-larger share of the federal budget, it would certainly make sense for him to believe (among other things) that the rest of the government needs to tighten its belt and get its fiscal house in order. In this context, surely it's reasonable to ask questions about whether changes need to be made to a program that between 2017 and 2041 will spend around $5 trillion more than it will take in. One can ask whether it's advisable from a political standpoint for Obama to go down that road, but it seems strange for liberal pundits to insist that every federal program be evaluated in a vacuum, irrespective of other priorities. If it's out of bounds to suggest that reforming Social Security might be part of a rational long-term response to ballooning health spending, then presumably those speaking ill of Obama in this case will also refrain from making the argument that defense expenditures should be reduced in order to fund universal health care.

--Josh Patashnik

P.S. Last baseball-related blog point (I promise!). Citing Buster Olney, Ross Douthat says "there hasn't been a good World Series since the Tribe-Marlins tilt of 1997." This makes sense only if you slept through 2001 and (alas) 2002, particularly the former, which featured four one-run games and no shortage of memorable moments.