The great Social Security battle of 2005 could well be remembered as the tipping point that ended George W. Bush's remarkable winning streak. It's now clear that Democrats are not about to provide Bush bipartisan cover for privatization. Even usually reliable Republicans are putting some distance between themselves and the president.
Bush and his allies control the legislative calendar, but for once, time is not on Bush's side. Privatization might have won a quick legislative victory had Bush just rammed a bill through Congress on the momentum of his election win. But the longer the privatization proposal twists in the wind, the more the media, wavering Republicans, and ordinary voters become conversant with the details -- and the worse the plan looks. The Democrats had put their post-election grief behind them by late February and recovered some energy, and the prospect of defeating Bush on a signature proposal has been quite a tonic for them. After a slow start, the AFL-CIO, AARP, and the Democratic Party itself are delivering some nice counterpunches.
One by one, key Republicans have distanced themselves from the idea, including House Speaker Dennis Hastert and Senate Majority Leader Bill Frist. Usually friendly columnists such as David Brooks in The New York Times and Sebastian Mallaby in The Washington Post have written unfriendly columns, with Brooks proposing Democratic-sounding add-on private accounts as a compromise and Mallaby warning of the hidden Mickeys in Bush's approach. As Bush's budget was unveiled and dissected, the enormity of the deficit problem got a good deal of attention, and the prospect of an additional $2 trillion of debt struck most budget observers as insane. A bill has not even been introduced, and there is already the pungent reek of a dead idea.
It could be the beginning of a trend. There is plenty in the budget that troubles moderate Republicans as well as Democrats. Bush's proposal to cut veterans' benefits, in the midst of a shooting war, will receive bipartisan resistance. His attempt to cut farm subsidies may be good policy, but it is difficult politics.
Meanwhile, his effort to turn Medicaid into a capped block grant is producing bipartisan opposition from governors. As employers reduce the coverage of private health insurance, and as freestanding insurance becomes ever more unaffordable, Medicaid is the only insurance available to more and more Americans -- and an ongoing drain on state budgets. Bush's Medicare drug program now turns out to cost upward of $700 billion, rather than the $400 billion that was forecast, because the bill, written to drug-industry specifications, explicitly prohibits the government from negotiating bulk prices with drug companies. Senators Edward Kennedy and John McCain are leading a bipartisan effort to repeal this provision. Meanwhile, on the intelligence front, Senators Pat Roberts and Jay Rockefeller are collaborating across party lines to hold a formal inquiry into the CIA's handling of terrorism suspects.
Bush's desire to radically restructure the tax system by shifting taxes from income to consumption could also run into a bipartisan buzz saw. The details will not be unveiled until fall, when a presidential commission is due to report. But any conceivable consumption tax will raise taxes on ordinary wage earners, while reducing them on wealthy investors. Unlike Bush's previous tax cuts for the well-heeled, this one cannot contain sweeteners for ordinary wage earners, because that would require even bigger deficits.
In short, despite his election win and his increased majorities in both chambers of Congress, Bush's winning streak is in big trouble in two fronts. First, his latest round of policy proposals is splitting his own base while unifying the Democrats. Second, the budgetary chickens are coming home to roost sooner than anticipated. Bush's whole game was to make sure that the most costly aspects of his tax and program cuts would not bite until after he left office. But it's apparent now that the bombs designed to detonate on his successor's watch are going off prematurely, at the very beginning of his second term.
It is astounding how the legislative magic and party discipline can quickly disappear once a chief executive becomes a lame duck. As soon as Republicans find that they can oppose a White House priority without being struck dead, they will find it easier to do it again. Conversely, the often feckless Democrats are learning in the Social Security battle that there is just no substitute for party unity. Ironically, Bush's second term could be a time for the bipartisanship that he falsely promised in 2001 -- not the ﬁg-leaf kind but the real article. And this bipartisanship would be in opposition to Bush's own policies.
Robert Kuttner is co-editor of The American Prospect. This article appears in our March 2005 print issue.
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