Deficit Panel Pushes Cuts To Social Security

The president's bipartisan deficit commission released some draft recommendations on Wednesday to bring the nation's debt under control. The preliminary report calls for cuts in domestic and military spending, reduction for some future Social Security recipients, and an overhaul of the tax code. Host Melissa Block talks to NPR's Mara Liasson about the draft report.

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MELISSA BLOCK, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Melissa Block.

Today, the president's bipartisan deficit commission released a draft of its recommendations. The commission's task is to find ways to help the U.S. dig itself out of a huge financial hole. Its preliminary report calls for cuts in domestic and military spending, reductions in benefits for some future Social Security recipients and an overhaul of the tax code.

For more details, we are joined by NPR's Mara Liasson. And, Mara, tells us more about what they're recommending here.

MARA LIASSON: Well, the two chairmen of the commission - Republican Alan Simpson and Democrat Erskine Bowles - have come up with a blueprint for how -starting in about two years when they assume that the economy will have recovered a bit to reduce the deficit and ensure Social Security solvency for 75 years. And it lays out a menu of options to get government spending in line with revenue, cuts in domestic and military spending, raising the retirement age, reducing Social Security benefits, subjecting more income to Social Security taxes, simplifying the tax code, reducing tax rates but also getting rid of a lot of tax breaks.

And what this document really does is challenge Republicans, who've been saying this all can be done with spending cuts - so far unspecified spending cuts -and the left that's been saying it can all be done with tax hikes on the rich. So if they don't like what's in here, it challenges them to come up with their own alternatives.

BLOCK: And how did these commission chairmen propose to get where they're headed?

LIASSON: Well, they - for instance, they give 50 examples of how to get $200 billion of spending out of the budget by 2015 in domestic and military cuts, including one of the very smallest options they offer, which is cutting the Corporation for Public Broadcasting, which is $500 million. But it tells - it lays out how you could take - get income tax rates lowered under different scenarios depending how many tax breaks you're willing to modify or cancel, including the mortgage interest deduction, the tax - the exclusion for employer-provided health benefits, charitable deductions.

Now, all of those are considered political kryptonite, and there's a big question whether Republicans will consider getting rid of these tax breaks -the same thing as a tax hike. It also made suggestions on how to control long-term health care costs. You could say that they are proposing to man up the new health care law in this regard.

BLOCK: A final report, Mara, will be out about three weeks from now, and after that, for any of this to become reality, Congress has to take it up. That is politically challenging, to say the least.

LIASSON: Well, the first political challenge is will the commission actually recommend anything officially? It takes 14 of the 18 commissioners to do that. Unless they do that, Congress is not required to vote on any of this. But even if they don't get the 14 votes, this could be a blueprint for others to work with.

Now, President Obama issued a statement saying he's going to wait to see what they do on December 1st. But so far, it's getting a lot of praise from deficit hawks, a lot of boos from the left, saying Social Security shouldn't be touched, you know, instead we should raise taxes on the rich. But I think the reaction is what you'd expect and remarkably open on a lot of fronts.

BLOCK: You know, when I talked to the commission chairmen earlier this year when they were heading out, Alan Simpson joked that they were jumping off the cliff here. They called it a suicide mission. Do you think this plays well politically, Mara?

LIASSON: Well, I think it is provocative. I think that's what they meant it to be. This is an issue whose time may have come again, and the message of the election was supposedly about the deficit and debt and spending. Certainly, it was the rallying cry of the Tea Party. And although the deficit was pretty low on the list of priorities in the exit polls - the economy and jobs were much higher. And when voters were asked about specifics, like raising the retirement age, they tend to reject them. But there is a sense that voters are ready to consider the tradeoffs and make the sacrifices because they understand that without doing anything about our fiscal situation, America will really cease to be globally competitive.

BLOCK: Okay. We'll see what comes out of the commission later.

NPR's Mara Liasson, thanks so much.

LIASSON: Thank you.

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