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Obama Draws the Line

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I just watched the President's speech on the debt, and have to say I was pretty impressed. I've been highly critical of Obama's lack of vision, but this time he gave a clear alternative to the 'cut everything for the poor' mantra of the Right.

Firstly, Obama outlined what he would not do: Privatize medicare, give more tax cuts to the rich, or destroy the social safety net that protects the most vulnerable. He delivered a withering review of the 'Ryan Plan' and accused Republicans of hanging the poor out to dry and giving more and more back to the rich. Obama also outlined a plan to cut $4 trillion from the deficit over 12 years and included defense spending - an absolute must if he is remotely serious about cutting government expenditure on unnecessary programs. I'm not convinced about his plans to reform medicare and social security (more detail and studies needed please), but his philosophy was right. Reform does not mean privatization, and liberals can breathe a sigh of relief that the President will not allow market forces to distribute benefits.

The President made a strong case for reinvestment in America, slamming Republicans again and again for refusing to acknowledge just how far behind the country is in terms of technology and infrastructure. This type of rhetoric is absolutely necessary if the Democrats are to combat the relentless GOP propaganda that has corrupted and distorted debate for far too long.

Here's an outline of the President's plan for deficit reduction (via Cesca and TPM):

A debt failsafe that will be triggered if the debt-to-GDP ratio hasn't stabilized, and begun to decline by mid-decade. This will include automatic spending cuts, and reductions in tax subsidies, but no tax increases.

Social Security, Medicare, and low-income programs will be exempted. It will not tie the government's hands in the event that an economic downturn requires fiscal stimulus.

Cuts to discretionary spending, compatible with those in the Bowles-Simpson recommendations.

Defense spending cuts, contingent on a thorough review conducted by Secretary Robert Gates, the Joint Chiefs of Staff, and Obama himself, and savings generated by winding down operations in Iraq and Afghanistan.

Strengthening the Independent Payment Advisory Board, created by the health care law to recommend and implement cost savings reforms to hold down the cost-per-Medicare-patient.

Simplifying the formula for providing federal matching funds to states for Medicaid, which would automatically increase in the event of a recession

This is a big one -- Obama will propose using Medicare's purchasing power to reduce prescription drug costs for seniors

Reductions in agricultural subsidies

Comprehensive tax reform, which reduces loopholes, simplifies the system, allows the Bush tax cuts for high-income earners to expire, and reduces the corporate tax rate.