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The appetite for entitlement changes

Activists hold signs that read "Hands off my Medicare" during a news conference on Capitol Hill in Washington, D.C.

Tess Vigeland: Now to our own domestic budget battles. There is no legislative business today on Capitol Hill, of course. But as soon as lawmakers get back to work, they'll return to a familiar topic in the news: the U.S. budget deficit. Republican leaders are insisting that their proposal to transform Medicare into a voucher system is still on the table in budget negotiations. Democrats are insisting the Republican proposal would "end Medicare as we know it." Is any kind reform for Medicare or Social Security possible in this political environment?

We asked Marketplace's Nancy Marshall Genzer to take a look.


Nancy Marshall Genzer: Entitlement programs, like Medicare, Medicaid and Social Security, are the biggest and fastest-growing parts of the federal budget. So it would be pretty hard to make a serious dent in the deficit without tackling them. The question is how, especially after last week's House election in New York.

Larry Sabato: This election may have killed any real chance at entitlement reform.

Larry Sabato teaches political science at the University of Virginia. He says both parties have reasons now to steer clear of major changes. Republicans don't want to be accused of weakening Medicare. Democrats and their supporters have made opposition to the Medicare voucher plan a major part of their strategy for the 2012 elections.

Roger Hickey is co-director of the liberal group Campaign for America's Future. He's telling Democrats the takeaway from the election is: don't tamper with entitlements.

Roger Hickey: It has sent a message that if you get on the side of the American people on Medicare and on Social Security, you can win just about anywhere in the country.

And last week's election in New York showed voters lean toward leaving Medicare alone. Medicare advocates have another, less public message for Democrats: If you trim entitlements, we'll go after you in the primaries, throwing our support behind a candidate who promises not to touch them.

Teddy Downey is a senior policy analyst at MF Global. He says, with that kind of pressure, Congress won't get serious about entitlements until after 2012.

Tedd Downey: The outcome of the 2012 election is the most important event deciding what entitlement reform will really look like.

Until then, Downey says, budget negotiators will just nibble at the edges, making incremental changes -- like slowing payments to doctors or making recipients pay just a teensy bit more.

In Washington, I'm Nancy Marshall Genzer for Marketplace.

About the author

Nancy Marshall-Genzer is a senior reporter for Marketplace based in Washington, D.C. covering daily news.

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