WASHINGTON – When President Obama backed entitlement reforms earlier this year as a way to shrink the nation’s long-term debt, some of his Democratic supporters worried that the next big budget deal in Congress might come on the backs of older folks on Social Security, including 927,500 beneficiaries in Minnesota.
They needn’t have worried.
The deal the U.S. House is scheduled to vote on Thursday to avoid another government shutdown is expected to do little to reduce the nation’s long-term debt, and nothing to trim back scheduled cost-of-living increases to the nation’s retirement system.
The budget deal is hardly a victory for conservative deficit hawks on Capitol Hill. Democrats, who would like to have extended jobless benefits, also have their misgivings. But what’s not in the agreement — entitlement cuts — is being hailed by an emboldened network of such congressional liberals as Minnesota Democrat Keith Ellison, who has been leading a grass-roots effort on Capitol Hill to resist cuts to the safety net programs, extend unemployment benefits and raise the minimum wage.
While pressure from the left has aligned with the populist tone of Obama’s recent emphasis on economic inequality, it also has fueled a rift between centrists and leftists in the Democratic Party reminiscent of the split on the right between so-called establishment and Tea Party Republicans.
Some strategists say a new populist streak could rejuvenate the party and excite the base, which has been forced to play defense on the troubled rollout of the new health care law. But others worry that it could threaten Democratic candidates in purple states like Minnesota, where U.S. Sen. Al Franken faces re-election next year.
“There’s been a rise in activism on both the left and the right for the last couple of years,” said Jim Kessler, co-founder of Third Way, a centrist think tank. “And in general, the middle of the country is feeling left behind.”
Kessler has shaken the Democratic firmament by challenging the left’s embrace of a new brand of economic populism, particularly that of a potential 2016 White House run by Massachusetts Sen. Elizabeth Warren, who wants to increase Social Security benefits. To Kessler, that’s a path off a “fiscal cliff.”
Ellison, who headlined a budget rally in front of the White House last month to protest potential cuts in Social Security, dismisses the criticism that he is helping put the Democrats on the path to ruin.
“My answer to that is if you don’t want us to fight for economic fairness, then you’d better go create some,” Ellison said.
‘We’ve got a movement’
Ellison’s differences with the Obama administration run deeper than just disagreements over trims to entitlements like Social Security. It also has extended to the minimum wage debate, which the political left considers favorable ground for Democrats.
“It’s our base. That’s what gets us in office. That’s what wins national elections,” said U.S. Rep. Raul Grijalva, an Arizona Democrat who co-chairs the Congressional Progressive Caucus with Ellison. “People shouldn’t be afraid of the populist growth in the party.”
The administration, which earlier this year suggested raising the federal minimum wage to $9 an hour, since has backed a $10.10-an-hour proposal put forward by liberal House Democrats. Obama has so far resisted calls by Ellison and Grijalva to use his executive powers to raise wages for some 2 million federal contractor employees — a group larger than the combined workforces of Wal-Mart and McDonalds.
Moments before Obama began a major speech on economic inequality this month, Ellison pressed a letter into his hands seeking an executive order to help federal contract workers. As the president spoke about a “dangerous and growing inequality and lack of upward mobility,” Ellison said he agreed with every word. Still, the congressman said he was haunted by the “nagging thought” that the president has the power, by the stroke of a pen, to raise the pay of thousands of low-wage employees who toil in museums within blocks of the White House.
The next morning, Ellison took part in a boisterous rally of janitors and cafeteria workers at the Smithsonian Institution. Many were black or Hispanic, and most donned Santa hats and chanted in English and in Spanish for Obama to give them a “living wage.”
“Folks,” Ellison told them, “we’ve got a movement.”
Unlike the minimum wage push, which faces stiff GOP resistance in Congress, liberal activists can claim a semblance of victory on Social Security in this week’s limited budget agreement, which cuts deficits by a modest $22 billion over the next decade. Although Ellison said he’s uncomfortable with pay cuts to federal workers, on Social Security he called it “a victory so far.”
The administration’s original budget plan to reduce the formula for future cost-of-living increases was met with alarm in April by activists on the left and such groups as the National Committee to Preserve Social Security and Medicare.
Max Richtman, who heads the group, appeared with Ellison at last month’s White House rally and told supporters that “the elephant in the room is a donkey,” a play on the two political parties’ symbols.
Republicans, who pushed for deeper spending cuts in the budget deal, have questioned whether the White House proposal to cut Social Security was ever more than a bargaining ploy.
Either way, Ricthman said, the Obama plan helped create a groundswell of grass-roots Democratic opposition. “It has stiffened the spines of a few Democrats who were getting a little wobbly,” Richtman said.
The GOP, which needs a net gain of six seats to take control of the Senate, appears keen to frame the 2014 elections around the problems of Obamacare and the nation’s mounting debt. The National Republican Senatorial Committee, the political arm of Senate Republicans, has sought to define Franken as “part of Washington’s spending problem.”
Minnesota’s junior senator acknowledges that changes need to be made to keep Social Security solvent, but he has said that reducing the cost-of-living index is not the way to go about it. His campaign has backed an online petition to stop Social Security cuts, telling supporters that while action is needed to cut the deficit, “I’m committed to making sure that action doesn’t cut Social Security.”
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