It’s not actually over.
Sure, the “fiscal cliff” came and went without any changes in Social Security’s cost-of-living adjustment formula, Medicare’s retirement age or other major aspects of those programs.
But the 13th-hour deal reached by the White House and Congress is only the first round of budget deals. The legislation lets all but the very wealthy keep the income tax breaks passed under President Bush. But it only delays for two months the spending cuts that were supposed to be automatic when 2013 dawned. And it leaves only about two months for Congress to raise the nation’s borrowing limit.
That means everyone will soon be back to the business of hunting for spending cuts and tax increases.
“This week’s agreement is a brief pause in the long-running threats to Social Security, Medicare and Medicaid, programs that help millions of Americans every day,” said Edward F. Coyle, executive director of the Alliance for Retired Americans. “But until there is a long-term and equitable resolution to these fiscal debates, retirees and workers everywhere will need to remain educated and mobilized.”
Conservatives are angry that the New Year’s deal has little in the way of spending cuts. Social Security and Medicare have $48 billion in future costs that aren’t funded yet, according to the Heritage Foundation.
“Without spending cuts and real entitlement reforms, that fiscal iceberg remains dead ahead,” the conservative think tank warned.
AARP issued a statement expressing concern “about harmful proposals to cut Social Security and Medicare benefits to balance the budget. Instead of cutting benefits, Washington should be looking for responsible solutions that address the long-term challenges facing Social Security and Medicare – like reducing health care costs throughout the system, not just shifting costs onto seniors.”
The prospect of more wrangling clearly disheartens U.S. Rep. Jim Moran. In a speech on the House floor on Jan. 1, the Virginia Democrat noted that “the problem is, we have set up three more fiscal cliffs. … We have to look back on this night and regret it.”