The fiscal responsibility summit

THE FISCAL RESPONSIBILITY SUMMIT…. Whenever President Obama or anyone associated with his administration utters the phrase “entitlement reform,” it generates an audible gasp. The fear, of course, is that the White House might buy into conservative rhetoric about weakening Social Security.

Those concerns are especially acute now, on the eve of next week’s “fiscal responsibility summit,” which may include some high-profile figures who see entitlement “crises” where none exist.

For what it’s worth, I’m not worried. Obama has always been entirely consistent on the issue — Social Security isn’t a crisis; Medicare needs to be addressed in the context of the healthcare system’s larger problems.

Those close to the president keep saying the same thing. OMB Director Peter Orszag, who’ll help lead the “fiscal responsibility summit,” said all the right things to Ben Smith yesterday.

Orszag’s long-running project — something that has made the Left’s favorite Cabinet member — has been replacing talk of an “entitlement crisis” with his argument that Social Security requires only modest tax hikes and benefit cuts, while Medicare and Medicaid have much more dramatic fiscal woes.

“Social Security faces an actuarial deficit over the next 75-100 years. In the past I’ve resisted the term ‘crisis’ to describe that kind of situation,” he said. “This is not quantitatively as important as getting healthcare done.”

Ezra Klein spoke to administration sources who said progressives really don’t have anything to worry about. “The most likely outcome at this point,” one senior administration official told him, “is that we focus on health care, given that it’s the key to our fiscal future.”

The administration does not think about the “entitlement question.” Rather, there are two sets of programs. One is Social Security. There’s a tendency for post-Bush progressives to quake when Social Security’s finances are called into question. But the Obama administration includes two of the economists most closely associated with the effort to beat back Social Security privatization (others were Dean Baker, Brad DeLong, and Paul Krugman). Peter Orszag, now head of OMB but then at Brookings, and Jason Furman, the staff economist for the National Economic Council but then allied with the Center for Budget and Policy Priorities, both helped craft and coordinate the response to Bush’s proposal, and were central to the effort to warn moderate Democrats off of the President’s plan.

There is no replay of Bush’s crisis-mongering the offing. No commission headed by Kent Conrad with a mandate to cut the program. Any fixes would look more along the lines of, well, the Orszag-Diamond proposal — which most liberal embraced as the responsible alternative in 2005 — than the Pete Peterson plan.

If anything, the “fiscal responsibility summit” appears to be a vehicle for advancing the Obama healthcare agenda. Works for me.