msnbc | March 03, 2013
>> we saw lawmakers on all the sunday talk shows , pretty much the same arguments. the senate is set to reconvene late on monday. the house comes back tuesday. what's going to happen?
>> well, as i think you heard speaker boehner say today, they're moving on to the next fight which is trying to avoid a government shutdown . and that means that these sequester cuts will probably be baked in. they might try to change them in a way to make them a little less arbitrary, to make the damage a little less. but you're still going to be hurting the economy. we're still going to be seeing economic growth decline pretty significantly. we're still going to be seeing 700,000 to 1 million jobs left if they're kept in place. because this is the type of spending that drives innovation, that boosts the economy. it's not the type of spending that is making our debt worse, which is the entitlements and the health care spending. the problem is still going to be there.
>> so let's say people on the hill, elyse, what are they telling you? any glimmer of hope to stop this sequester?
>> you know, i think it's going to take at least a couple of weeks before we see any hope. i think there's a palpable sense of fatigue on capitol hill right now. this is one in a series of fiscal deadlines. there was a lot more drama over the fiscal cliff at the beginning of the year. people kind of expected the sequester would take place. they sort of thought this would be the outcome. and so i think they're going to wait a couple of weeks in a sort of sense of impasse why they weigh what could happen next.
>> let's look at what was written in today's " washington post " by ezra klein . makes a compelling argument that whatever president obama is for the gop will be against even if the president agrees to lowering some social security benefits over time . specifically what's called the change cpi in the past. some of the gop have said that is the key to breaking this stalemate. now the president says he's okay with it. it appears republicans want more now. is that how you read it?
>> that overlooks one important point. and this is something that the president talked about on friday. and that's that his democrats really resist this notion of changing benefits at all. you've got -- as you mentioned, the change cpi which wouldn't cut social security . just sort of slow the growth of benefits over time to more accurately reflect inflation. democrats say that's a nonstarter. you have the notion of changing medicare so the wealthiest retirees who are the wealthiest group of americans as a whole would maybe pay a little bit more in their retirement funds. a lot of democrats resist that idea, too. republicans are being pretty -- when it comes to tax increases and closing loopholes. the democrats are digging in their heels on this other side. and this is a shame because everybody's known for years these are the two things we need to do to get our finances on a sustainable course.
>> so what do you think is happening, elise? is the gop holding out for some sort of longer term political gain?
>> i think republicans have co cocoalessed around this idea of no new taxes. we've seen defense go by the wayside. the party has found at least within the house gop something where everybody can agree. i think we really have to remember the gop is still recovering from a very devastating election that set in motion a process of internal reform that is going to take months, if not years. and so i think we have to wait and see what the power plays will be within the gop . because we frankly don't know quite what they're going to be yet.
>> andy, i'm looking at your latest article. the title of it being "cuts unlikely to deliver promised budget savings." so does that mean even the silver lining for the sequester cuts doesn't exist?
>> absolutely, alex. everybody talks about how it's $85 billion cut this year. but that's not the case at all. it would actually be much less than half of that. maybe closer to $30 billion. which is still a chunk of change but not clearly what we'd expect. some of that is because the government spends money more slowly than we would think. a lot of it is because it hurts the economy. i'll give you one example. they're supposed to open yellowstone national park this weekend. but they've got to save money. so they're not running the snowplows through to open up the roads. that saves them about $250,000 in fuel costs. but you're losing $2 million in tourism business. that hurts all the hotels and all the restaurants that depend on that for their line of work. that means they'll be paying less in tax revenue to the government. that means you're going to have more money on things like food stamps as people are thrown out of work. so you actually -- the savings start to be counteractive. they work against you.
>> elise, i look at your collatest article as well on the hill. it's titled senate gop pushes hhs for sequester details. of course, health and human services , hhs. what is behind all this?
>> so i think what we're seeing is an attempt by republicans in congress to really get down into the dirty details of how the sequester will be enforced. and there have been some suggestions that the obama administration has more power than it has suggested to enforce the cuts in a way that will not be so painful. one example would be we hear the obama administration talking about things like children's vaccines which will be cut. and what republicans are asking are, you know, is it really true that those are going to be on the front lines of these cuts? or was that merely a political move in order to build up opposition to the sequester? so republicans are doing this to conduct oversight, but also to do a fair bit of messaging about what they believe is a politically motivated move by the obama administration.
>> you also talk about the administration kind of cherry picking their sequestration examples to make their point.
>> that's right.
>> thank you, both. good to see you. thank you so