President Obama said his 2008 campaign message of hope still springs eternal when it comes to breaking the impasse in debt ceiling negotiations with Republicans in the next few days.
“I’m hopeful that over the next couple of days we will see this logjam broken,” he said at a Friday press conference, his second in a week.
“I always have hope, don’t you remember my campaign…even after being here two and a half years,” he later added.
But the devil is in the details as to whether both sides can strike a grand bargain and achieve $4 trillion in savings over the course of the next 12 years or whether partisan differences will force them to scale back to a smaller package of cuts tied to the debt-ceiling increase.
Republicans led by Majority Leader Eric Cantor (R-VA) have been dead-set against including any net tax increases in any grand deal, but Obama continued to press for a balanced compromise that would include both “revenue raisers” and changes to entitlement programs, which many Democrats oppose.
“The fall back position, the third option, and what I consider the least attractive option, is one in which we raise the debt ceiling without making any significant progress on reducing the deficit,” he said.
Obama specifically highlighted the possibility of additional means-testing for Medicare as a way to achieve savings, noting that his proposal would not affect current beneficiaries.
“You can envision a situation where for somebody in my position — me having to pay a little bit more — would be appropriate…and that could make a difference,” Obama said during a Friday press conference.
He flat-out rejected a proposal from Rep. Paul Ryan (R-WI) that would privatize a portion of Medicare and pass additional costs for benefits along to seniors.
“What we’re not willing to do is restructure the program that we’ve seen coming out of the House over the last several months where we’d voucherize the program and have senior citizens paying $6,000 more,” he said.
Medicare premiums for doctors and for prescription drugs are already means tested, i.e. couples making over $170,000 or singles over $85,000 (about 5 percent of Medicare beneficiaries) already pay somewhat higher Medicare premiums, an administration official tells TPM. In addition, Obama’s Affordable Care Act included a nominal freeze of those high-income thresholds through 2019, resulting in already modestly greater means-testing for high income Medicare beneficiaries.
“What the President referenced today was his openness, as part of a potential big deal, to asking Medicare recipients over those high-income thresholds to pay modestly higher premiums,” said the administration official. “At no point did the administration express openness to raising premiums on Medicare beneficiaries below those income levels.”
Obama also said he’d rather not be forced to consider a proposal by Senate Minority Leader Mitch McConnell that would forego reaching a major deal and hand over the power of raising the debt ceiling to the President because it does not address the long-term problems of the budget.
“We are obviously running out of time,” Obama said. With the clock ticking on the Aug. 2 deadline for increasing the nation’s borrowing limit, Obama said he’s asked Congressional leaders to come up with proposals in the next 24-to-36 hours that would offer a roadmap for reaching an agreement.
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