Still, he said, Congress needs to slow the rate of growth of Medicare, Medicaid and Social Security as more Americans retire and put pressure on these New Deal and Great Society programs.
Those details would have to be worked out at a later date. It’s too close to the deadline — the beginning of the year — to change those mammoth and important programs now.
Most of the debate in Washington has revolved around taxes, which form the bulk of the deficit reduction. Tax rates will automatically increase back to their 2000 levels after the first of the year when the Bush-era tax cuts to Clinton-era rates expire.
That technically means lawmakers don’t have to vote to raise taxes because the rates will automatically increase anyway. At that point, lawmakers, specifically Republicans, could then vote to cut taxes again and increase defense spending — and score political points for doing it.
But Martinez said that’s a bad idea because it might spook the financial markets, which is expecting some type of deal this month.
The head of the Florida Legislature’s economic-research agency, Amy Baker, said state economists think a deal will be struck. But, she said, if there’s no agreement by March, they estimate it could weaken consumer confidence to such a degree that Florida’s budget could ultimately lose upward of $375 million.
House Speaker John Boehner has called on the president to publicly offer up proposed entitlement cuts. But Obama and Democrats are hesitant to do so, having been bashed by the GOP over the past two elections for trimming back future Medicare expenses to help pay for Obamacare. So they want Republicans, whom they attacked for trying to "voucherize" Medicare, to go first.
Martinez, who left Congress after serving from 2005-2009, said partisanship is probably worse now than when he served and watched an immigration-reform bill killed, largely by members of his own party.
But there’s a stronger motivator in the Capitol that could lead to a short-term solution on taxes and spending.
“One of the strongest instincts in many Washington people is political survival,” Martinez said. “And I think that is now tied to getting something done.”