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Steve Chiotakis: Things are getting back to normal this morning in Washington D.C. After all the pomp and elegance of a new president and inaugural balls, the Senate gets to work on confirmations and budget hearings. The Senate Finance Committee hears from Timothy Geithner, President Obama’s nominee to head the Treasury Department. He’ll have to explain his initial failure to pay payroll taxes he owed while working for the International Monetary Fund.
And then there are the challenges of long-term budget issues. That has some on the Senate Budget Committee looking once again at entitlements. Here’s Marketplace’s Sarah Gardner.
Sarah Gardner: President Obama says he’ll convene a “fiscal responsibility summit” before giving Congress his first budget. He says the biggest problem is Medicare, which he calls “unsustainable.”
Former Congressional Budget Director Alice Rivlin will testify at the hearing and says there are solutions.
Alice Rivlin: We can rein in the entitlement programs, we can raise taxes, we can do some of both. But we have to face up to this problem.
A government report predicts Medicare will be insolvent by 2019 if nothing is done. But economist Dean Baker says politically, it’ll be tough.
Dean Baker: The baby boom cohorts have just seen much of their wealth disappear in both their house and the stock market, so it seems like really bad policy and virtually impossible to sell politically.
Baker argues the biggest problem is rising health care costs. He believes if Obama can fix that, Medicare won’t be such an albatross.
I’m Sarah Gardner for Marketplace.
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