TaxVox Steny Hoyer and the Deficit: “We’re Lying to Ourselves and Our Children”
Howard Gleckman
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Maryland Democratic congressman Steny Hoyer is something of a throwback. In an age of ideological extremes, the House Majority Leader is a moderate. At a time when elected officials are held in low esteem, the #2 House Democrat proudly serves in his fourth decade as a legislator. And when incendiary speech is the ticket to political stardom, Hoyer is far more comfortable counting votes in legislative backrooms than delivering red-meat polemics.

But this morning Hoyer gave what may turn out to be one of the most candid and important domestic political speeches of the year. Speaking to The Third Way, a middle-of-the-road Democratic think-tank, Hoyer called for a bipartisan effort to balance the need for short-run economic recovery with long-term deficit reduction. Not much new there. Lots of pols have delivered a similar message in recent months. But what made Hoyer’s talk matter is that he named names.

It is easy to say, “everything is on the table.’ It is not so easy for an elected official to explicitly describe what that means. Hoyer did. And his remarks won’t make him any friends within the Democratic base. Among his proposals: Trim future Medicare costs. Raise the Social Security retirement age. Adjust both programs to focus benefits on those who need them most, even if it means reducing benefits for wealthy retirees. Cut defense spending. Have a “serious discussion” about whether to permanently extend the Bush tax cuts for those making less than $250,000 as President Obama wants. Enforce budget rules that require Congress to pay for new spending and tax cuts.

Economic recovery remains Hoyer's top priority. But when it comes to the need for deficit reduction, he didn’t pull his punches:  “We’re lying to ourselves and our children if we say we can maintain our current levels of entitlement spending, defense spending, and taxation without bankrupting our country.”

Hoyer is no pie-in-the-sky idealist. For instance, he recognizes flaws in an Obama-favored PAYGO system that exempts Congress from having to finance tax cuts for the middle class and a handful of rich estates, as well as temporarily protecting physicians from reductions in Medicare payments. But, he says, in the real world Congress would simply waive the law for these proposals anyway. Hoyer would fix this problem by turning from unfunded temporary fixes to permanent changes that reflect true long-term costs. 

While Hoyer is a moderate, he remains a Democratic partisan. And he rips Republican lawmakers for opposing both tax increases and efforts to trim future growth in Medicare spending. He also hammers the GOP for the sin of superficiality: “The eagerness of so many to blast spending in the abstract without offering solutions that come close to measuring up to the size of the problem.”

But make no mistake, Hoyer’s main audience was Democrats. He signaled to them (and to Obama) that he is willing to take on his own party’s sacred cows, including Medicare, Social Security, and those “middle-income” tax cuts that have been so important to the President.

Hoyer is not just another Blue Dog back bencher. He matters. And as Washington continues to struggle with the deficit, so will this speech.  

  

 

Primary topic Federal Budget and Economy
Research Area Federal Budget and Economy Individual Taxes