Nancy Pelosi Games Out The Long Fight Over Medicare And The Rest Of The Safety Net

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Eight months is a long time in politics, but it will be eight months ago next week that House Republicans voted overwhelmingly for a budget that envisioned a massively scaled-down social safety net — a smaller, privatized health care system for old people, to replace traditional Medicare; Medicaid financially constrained, and handed over to state governments; cuts to various other support programs that benefit the poor, the young, and the elderly.

That didn’t sit well with voters. And in the months that followed, Republicans tried to contain the fallout by making federal deficits a central political issue while forcing Democrats to agree to real cuts to these programs — all while refusing themselves to raise taxes, even on the very wealthiest Americans.

This too didn’t go according to plan. The GOP upheld its vow not to raise taxes; Democrats insisted new tax revenue was a criterion for cutting benefits; and Medicare, Medicaid, and Social Security avoided the scalpel.

At least for now.The 112th Congress has been an exhibition match over the safety net, pitting conservatives who have been trying for a generation to roll it back, against progressives who want to protect and expand it. But very little has truly been on the line. In the not-too-distant future these adversaries will likely collide again, this time for real — and it will test both the conservative movement’s “starve the beast” strategy for shrinking government, and the left’s appetite for an existential standoff with a more disciplined political movement.

In an interview last week, TPM asked Nancy Pelosi to take the long view on the ideological divisions that this year’s budget fights exposed. She sought to assure her allies that the social contract is in good hands, but hinted at some outcomes that progressives might not enjoy.

“I think we’re ready for it all,” Pelosi predicted.

Pelosi explained that the origins of this fight go back decades.

“The generation after — the 60s and early 70s, this whole group of very substantially wealthy…conservatives formed these foundations, which I’m sure you’re aware of, that decided that what was happening with the hippies and the peace movement and all the rest of it was threatening to the free-enterprise system and they had to protect it,” Pelosi said. “So what did they do? Formed foundations, bought chairs in universities and this or that, and one of the things that was part of this protecting the free-enterprise system was telling young people ‘Social Security’s not going to be there when you retire’…. So this is what’s coming down the pike for 50 years — 40 years, lets say.”

This fight has erupted several times over the years. It flared most recently in 2005 when President Bush pursued Social Security privatization, and before that in the 1990s when the Newt Gingrich-led GOP majority pushed a partial Medicare privatization plan that Gingrich believed would allow the program to “wither on the vine.” All of that was before Citizens United opened the floodgates for enormous streams of anonymous money to flood into politics. And Pelosi now believes changing the democratic process is one of the keys to insulating social insurance and other support programs from attack.

“We’ve got to mobilize the 99 percent,” Pelosi said. “One of the things that we have to do is to increase and strengthen the participation of citizens in the electoral process, both financially and at the polls…. We have to pass the DISCLOSE Act. We want the President to do what he can by executive order, hopefully he will. But nonetheless in this election we have to talk about ending secret, big secret money in campaigns.”

Separately, though, she argued that Democrats (both today and in the future) will have to be prepared for both bare-knuckled political fights and smart legislating. That means blunt attacks on Republicans who want to unwind the programs, and a clear understanding of both how the programs work and how to change them to make them sustainable…even if those changes aren’t always appealing to their strongest supporters.

“You have to give the Republicans credit — they act upon their beliefs,” she said. “And they do not believe in a government role in clean air, clean water, food safety, public safety, public education, public health, Medicare, Medicaid, Social Security. They don’t believe in that. And they act upon that. But they fudge it when they go out to public.”

Unfudging it, she said, is the Democrats’ job.

“The thing is is that we have nothing to lose now — I say to members we don’t have anything to lose. Just go out there, go for broke, swing for the fences, because everything is at stake. Everything is at stake.”

Her Whip, Steny Hoyer agrees. At a meeting with reporters I asked him to game out the next decade. He argued that Republicans will suffer badly at the polls if they don’t cut the fiscal right wing of their party loose and agree to raise taxes — and added that, privately, GOP leaders agree with him.

“Well, it’s going to be very difficult,” he said.

You’re talking about 10 years. People are going to have to make a decision at least five times on the makeup of the House of Representatives and if that’s the way they want to go. Eighty-two percent of the American public — maybe it was 75 percent of the American public — says that raising taxes on the wealthiest in America, millionaires and above, is a rational policy to pursue. Frankly, a political party that is ready to devastate government programs on the cross of gold of the richest in America is not a party that I think will be sustained by the American people, when you have 82 percent saying, look, we’ve got a problem, we’ve got to solve it, some of the wealthiest people in America have got to help us out, pay more taxes.

Pelosi argued that keeping entitlement programs ring-fenced from the rest of the budget will keep them from becoming susceptible to conservative plans to scale them back or phase them out.

“On a separate table you have entitlements,” she said. “If you want to raise the age or this or that, that’s always a fight. But whatever it is, the money should stay in Social Security. They want to address Social Security as a way to unravel it. We’re saying, ‘oh you want to address it, you have some idea, let’s do that to strengthen it.’ And that’s a fight they can never win.”

“Medicare is hard,” Pelosi admitted. She noted that President Obama’s health care law is designed to lower costs and to broaden the federal role in health care — guaranteeing a health support system for nearly all people in the future. But she said program cuts are inevitable — and even justified — whether or not the GOP ultimately breaks its anti-tax orthodoxy.

“I wouldn’t put taxes next to Medicare — the taxes are for our being able to pay our bills, and to invest in the future,” she said. “[Medicare] at some point has to be more reliant on economies that we put into the system and the rest and increases in some copays and the rest. I know some people find that to be anathema, but we’re talking about high-end people; we’re talking about high-end people who can afford to pay more and should pay more.”

To these ends, she’s helping to craft the Democrats’ message going into this election as one of a choice of values — and she’s built the party’s infrastructure on the Hill to assure that when she’s gone she’ll be replaced by like-minded people.

“I think we’re ready for it all and I think that the next generation of leaders is fully [prepared],” she said. “The people I sent to the table — two of them — Chris Van Hollen and Xavier Becerra are the next generation. And they know these issues very well.”

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