The “Grand Bargain” — the mythical agreement between Democrats and Republicans to cut entitlement spending — has died.
The cuts to Social Security cuts that were included in President Barack Obama’s budget last year were viewed as a necessary olive branch to Republicans at the time. Many Democrats in Washington, including the President, thought it should be on the table to strike a deal — the elusive “grand bargain” on the budget.
A year later, the paradigm has completely swung. Obama will drop the proposal from his budget this year. Led by Sens. Tom Harkin (D-Iowa), Sherrod Brown (D-Ohio), and Elizabeth Warren (D-Mass.), many Democrats now not only oppose the cuts, but also favour an expansion of Social Security benefits.
“It is really amazing how much the conversation has shifted,” one Senate Democratic aide told Business Insider.
Key members of both the House and Senate Democratic caucuses — including Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi — applauded Obama on Thursday for removing the proposal from his budget.
A lot of the credit, people on and off the hill say, goes to outside progressive groups who began the momentum against the “chained CPI” cost-of-living adjustment, which cuts Social Security benefits by recalculating the growth of benefits with an index that doesn’t rise as quickly as inflation.
Though many Democrats in Washington were willing to sacrifice the cuts in the name of the “grand bargain,” progressive groups never thought they should be on the chopping block. In turn, it took much of Washington until Thursday to realise that the elusive grand bargain was finally dead after a four-year run.
The progressive groups say that they were bolstered by the dose of reality outside Washington, and by vast opposition to the cuts from Americans.
Becky Bond, the vice president and political director of the progressive group CREDO, is hard-pressed to remember a quicker shift on an important — and often divisive — issue.
“This is an issue where Republicans and Democrats agreed, but it was separated in some sense,” Bond, CREDO’s political director, told Business Insider. “Inside the beltway, Democrats and Republicans in the White House and on the hill agreed we should cut Social Security benefits to cut a deal. But outside the beltway, Democrats and Republicans agreed, too — but they agreed on the opposite.”
CREDO delivered more than 1.3 million petition signatures and 51,000 calls to the White House and members of Congress pushing against the possibility of Social Security cuts. Democracy for America, the group founded by former presidential candidate Howard Dean, delivered 2.3 million signatures soon after Obama included the proposal in his budget last year.
The Progressive Change Campaign Committee was one group that put the Social Security cuts at the forefront of its advocacy. And in July, it led a big strategic shift that would keep swinging the conversation — it decided to “stop playing defence” and go on offence, leading the push to expand Social Security benefits.
It rallied in support of bills to strengthen Social Security benefits. One such proposal was a bill from the liberal Sens. Harkin and Brown, which would increase benefits by undoing the cap on payroll taxes at $113,700.
The middle of November served as a turning point for the shift. On Nov. 17, Warren announced her support of Social Security expansion in a speech on the Senate floor. With Warren’s name and a bigger push, more media outlets began taking notice.
In the lead-up to the release of Obama’s budget, Rep. Allyson Schwartz (D-Pa.), who is running for governor in Pennsylvania, spearheaded an effort in the House against the Social Security cuts. She led 117 members of the House in sending a letter to Obama, urging him to not use seniors as a “bargaining chip.”
“This is a huge progressive victory — and greatly increases Democratic chances of taking back the House and keeping the Senate,” PCCC co-founder Stephanie Taylor said after Obama announced he was dropping the cuts from his budget on Thursday. “Now, the White House should join Elizabeth Warren and others in pushing to expand Social Security benefits to keep up with the rising cost of living.”
Indeed, the final nail in the coffin of the grand bargain may have surprised some in Washington. But the people who realised it long ago are already looking ahead.
“We have changed the conversation in Washington,” Neil Sroka, the communications director for Democracy for America, told Business Insider.
“To the point where, these ‘Very Serious People’ know that it is just not an acceptable view in the Democratic Party today to be talking about cutting earned-benefit programs that people have been contributing to their entire lives. … So, let’s start talking about what Americans actually want — which is expanding these programs.”
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