FLASHBACK: Obama Calls Medicare Privatization ‘Legitimate’ But Problematic Proposal (VIDEO)

Washington is waiting with bated breath for President Obama’s Wednesday address on attacking national deficits and debt. Republicans are preemptively objecting to any plan that will involve increasing income taxes on the wealthy. Liberals and Democrats don’t know what to think. They worry both that President Obama’s proposal won’t be progressive enough on the merits and will undermine their ability to counter a GOP plan that reduces debt by eliminating Medicare and dramatically slashing and changing Medicaid.

Just over a year ago, though, Obama gave us a peek behind the curtain when he debated House Republicans at their annual retreat in Baltimore, MD. Toward the end of the 90 minute back and forth, Obama addressed Paul Ryan’s Roadmap for America’s Future, and its very similar Medicare privatization scheme.What he said should both hearten and concern progressives and his allies in Congress. Because while Obama explained why privatization is a bad idea, he also called it a “legitimate” plan and cautioned both parties against attacking each others’ fiscal ideas in a way that undermines compromise.

“[A]s I said before, this is an entirely legitimate proposal,” Obama said. “The problem is twofold: One is that depending on how it’s structured, if recipients are suddenly getting a plan that has their reimbursement rates going like this, but health care costs are still going up like that, then over time the way we’re saving money is essentially by capping what they’re getting relative to their costs.”

Ryan’s plan would end Medicare as a single-payer system and turn it into a program of federal subsidies for private insurers, to encourage them to cover the elderly and disabled. When those subsidies don’t keep pace with health care costs, beneficiaries will have to pay out of pocket or forego care.

“If the main question is going to be what do we do about Medicare costs, any proposal that Paul makes will be painted, factually, from the perspective of those who disagree with it, as cutting benefits over the long term,” Obama said. “And I raise that not because we shouldn’t have a series discussion about it. I raise that because we’re not going to be able to do anything about any of these entitlements if what we do is characterized, whatever proposals are put out there, as, well, you know, that’s — the other party is being irresponsible; the other party is trying to hurt our senior citizens.”

If Obama’s going in to his speech Wednesday under these pretenses, he’s going to walk into a fusillade. Already Republicans are gearing up to attack his plan for calling to raise taxes in any way.

Americans “don’t want to raise taxes, they don’t want spending to continue to spiral out of control,” said House Majority Leader Eric Cantor on Fox News Sunday. “And those are the kinds of things and mechanisms, whether it’s spending caps, entitlement reforms, budget process reforms — these are the kinds of things we’re going to have to have to go along with the debt limit increase.”

Cantor added, “I then hear they’re going to present a plan on how to address the fiscal situation, and right away they insist that we have to go out looking to raise taxes again, all the while holding up the tax agreement that was signed in December. So on one hand, we’re going to defend that tax agreement, but then go ahead and violate it.”

Watch Obama on Ryan’s plan at the end of the first clip and beginning of the second.

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