The Missing Piece of the “Super Committee”

The failure of the “Super Committee” to reach an agreement concerning spending reductions of at least $1.2 trillion over ten years seems to symbolize the growing philosophical divide in America.  Despite the “marriage” between Grover Norquist and the Republican party, the Democratic party remains more consistent in their beliefs of expanding the size and scope of government than their Republican counterparts are about diminishing it.  A recent Wall Street Journal editorial by the Committee’s co-chair, Representative Jeb Hensarling, reveals the mindset of his Democratic counterparts:

“President Obama summed up our debt crisis best when he told Republican members of the House in January 2010 that “The major driver of our long-term liabilities . . . is Medicare and Medicaid and our health-care spending.” A few months later, however, Mr. Obama and his party’s leaders in Congress added trillions of dollars in new health-care spending to the government’s balance sheet.”

“Democrats on the committee made it clear that the new spending called for in the president’s health law was off the table. Still, committee Republicans offered to negotiate a plan on the other two health-care entitlements—Medicare and Medicaid—based upon the reforms included in the budget the House passed earlier this year.”

“The Medicare reforms would make no changes for those in or near retirement. Beginning in 2022, beneficiaries would be guaranteed a choice of Medicare-approved private health coverage options and guaranteed a premium-support payment to help pay for the plan they choose.”

“Democrats rejected this approach but assured us on numerous occasions they would offer a “structural” or “architectural” Medicare reform plan of their own. While I do not question their good faith effort to do so, they never did.”

“Republicans on the committee also offered to negotiate a plan based on the bipartisan “Protect Medicare Act” authored by Alice Rivlin, one of President Bill Clinton’s budget directors, and Pete Domenici, a former Republican senator from New Mexico. Rivlin-Domenici offered financial support to seniors to purchase quality, affordable health coverage in Medicare-approved plans. These seniors would be able to choose from a list of Medicare-guaranteed coverage options, similar to the House budget’s approach—except that Rivlin-Domenici would continue to include a traditional Medicare fee-for-service plan among the options.”

“This approach was also rejected by committee Democrats.”

This article contains two unique components.  First, Democrats refuse to alter the manner in which their beloved programs operate–despite the looming fiscal peril.  Second, and likely in the hopes of sounding bipartisan, Mr. Hensarling does not challenge the merits of the entitlement state.  Essentially, Republicans agree that an individual’s rights end where someone else’s needs begins.  In attempting to promote the concept of the mixed economy, Mr. Hensarling continues:

“In the midst of persistent 9% unemployment, the committee could have enacted fundamental tax reform to simplify the tax code, help create jobs, and bring in over time the higher revenues that come with economic growth. Republicans put such a plan on the table…”

“Republicans were willing to agree to additional tax revenue, but only in the context of fundamental pro-growth tax reform that would broaden the base, lower rates, and maintain current levels of progressivity. This is the approach to tax reform used by recent bipartisan deficit reduction efforts such as the Bowles-Simpson fiscal commission and the Rivlin-Domenici plan.”

“The Democrats said no. They were unwilling to agree to anything less than $1 trillion in tax hikes—and unwilling to offer any structural reforms to put our health-care entitlements on a permanently sustainable basis.”

Republicans fail these debates because, fundamentally, they concur with their Democratic colleagues; the entitlement state is a moral priority.  The matter on which the two parties disagree is the method for funding the entitlement programs.  As Mr. Hensarling argues, lower tax rates help “broaden the base, create jobs, and bring higher revenues.”  He does not say that wealth is created and earned as a result of production.  He does not argue that, in a capitalist system, all wealth is earned.

Instead of defending the utility of liberal economics in terms of funding entitlements, the politicians who want to stand against the socialist/liberals need to address the immorality of redistributing other peoples’ money.