2012 Budget Fight Starts This Week

The final vote on the 2011 budget hasn't even been taken yet, but the battle over the 2012 budget will kick off this week. And I expect it will dwarf the budget fight just finished, both in scope and intensity.

The Republicans had just asked for $61 billion in cuts for the 2011 budget, and finally settled for $39 billion. But the changes they expect for the 2012 budget are much more massive. While they want more tax cuts for the rich and the corporations (the only people doing well in the current recession), they will ask for more pain for everyone else. And that includes the elderly, since they want to abolish Medicare completely and force seniors to buy private insurance.

The Republicans don't seem to care that this would result in seniors doubling their current outlay for medical costs -- if they can afford to buy private insurance. But many will no longer have any insurance at all. It seems rather disingenuous of the Republicans to have accused President Obama of hurting Medicare with the health care reform law, and now they want to do away with Medicare altogether.

The Republicans in the House are expected to pass their draconian bill that does away with Medicare by the end of this week, and it is expected it will also gut the EPA and drastically cut most social and education programs. I think they know it has absolutely no chance of being approved by the Senate or signed by the president.

They are setting themselves up for the 2012 election. They think that they can convince Americans by the next election that abolishing Medicare and cutting Social Security is necessary. I think they're are misjudging the mood of the country and the popularity of those two programs, and if the Democrats are smart, they'll make them pay for that in the next election.

But the Republicans aren't the only ones firing their first volley in the coming budget battle. On Wednesday, the president will unveil his own budget plan -- and you can bet it won't include abolishing Medicare (since the White House has said that won't happen). The president has climbed aboard the deficit-cutting bandwagon though, and that means there won't be any job creation in his budget either.

Sadly, the White House has made some noises like Social Security must be cut. I hope not, because that is just not necessary at all. A simple removal or raising of the cap on the amount of income subject to FICA taxes will insure the health of Social Security for many decades to come (and it would affect only the wealthier Americans -- the ones who can afford it). There is no reason to raise the retirement age or cut benefits, and if the president tries to do either one there will be a backlash (especially among members of his own party).

It will be interesting to see just where the president thinks cuts can come from in the budget. Hopefully it will include corporate subsidies and the rollback of the Bush tax cuts for the rich, not to mention a big hunk of the Defense Department budget. It should include stopping the wars in Iraq and Afghanistan, but I doubt that will happen since the president seems to have bought into both of Bush's wars.

Whatever happens, we know two things that will happen. Ordinary Americans will suffer more and there won't be any job creation help. It's starting to look like both the Republicans and the president agree about those. The best we can hope for is that Democrats are able to force the rich to shoulder a little more of the burden.

I had hoped that people would have learned from the lessons of the late twenties and early thirties that deficit -cutting won't cure a recession -- it just makes it worse. But our politicians seem to have learned nothing from history. They seem to think that repeating past mistakes will work now (even though it didn't in the past).

We're in for a hard two more years, and if the Republicans remain in power after 2012, for a lot longer that two years. It's not a good time to be a worker (or poor or elderly) in America.