This is why progressives cannot afford to leave austerity to the right. The left has more to lose. Put another way, their sacred cows are more likely to face the chopping block. Medicare, Medicaid and Social Security consume about 70 percent of all revenue. The American budget subsists on credit.
Conservatives have political and philosophical reasons to fear any credit crisis. It would mean cutbacks in defense spending. It would require tax hikes. It would undercut American power on the world stage.
But entitlements would face the most traumatic and immediate reckoning. The big three entitlements account for about twice the share of the annual budget as defense spending, even though defense spending has sky rocketed in recent years. A debt crisis would also hit public employee unions hard, now a pillar of the Democratic coalition. Yet Republicans are more than twice as likely as Democrats to see the fiscal situation as “dangerously out of control,” according to a recent Bloomberg poll.
Conservatives have the leverage in this debate. They have less to lose politically by inaction or steps that enlarge the debt, like the pending tax deal. Democrats cannot easily do more with government if Americans, and markets, already think government does too much. That means, in conjunction with GOP concessions on defense cuts and taxes, Democrats must do more than reconcile with entitlement reform, they must fight for it.