Biden Aims to Keep Playing Offense on Medicare

Biden’s not going to let anyone forget which party created Medicare. Photo: Joe Raedle/Getty Images

In his State of the Union address, President Joe Biden made an audacious play to smoke out Republican plans to cut retirement benefits in the name of fiscal discipline. It worked, and now Biden has seized the initiative again with a proposal to strengthen Medicare’s solvency via higher taxes on the wealthy. Two days before unveiling his fiscal year 2024 budget, Biden pitched his Medicare plan in a New York Times op-ed:

For decades, I’ve listened to my Republican friends claim that the only way to be serious about preserving Medicare is to cut benefits, including by making it a voucher program worth less and less every year. Some have threatened our economy unless I agree to benefit cuts …

The budget I am releasing this week will make the Medicare trust fund solvent beyond 2050 without cutting a penny in benefits. In fact, we can get better value, making sure Americans receive better care for the money they pay into Medicare.

When Medicare was passed, the wealthiest one percent of Americans didn’t have more than five times the wealth of the bottom 50 percent combined, as is now the case, so it only makes sense that some adjustments be made to reflect that reality.

Biden folded this proposal into claims that Democrats have already vitally improved Medicare’s solvency via the cost-containment measures in the Affordable Care Act and the power to negotiate drug prices for Medicare that was featured in the Inflation Reduction Act of 2022. By proposing to strengthen “Medicare’s newly established negotiation power,” Biden is now exposing and exploiting the GOP’s extremely unpopular stance of solidarity with Big Pharma. At the same time, he’s countering Republicans’ bad intent toward Medicare benefits with populist rhetoric about making the rich pay “just a little bit more of their fair share” via a boost in “the Medicare tax rate on earned and unearned income above $400,000 to 5 percent from 3.8 percent.”

Thus, Biden is trying to give Democrats a proactive stance on Medicare solvency and the overall debt-and-deficit problem while presenting it as a simple choice between higher taxes on the rich or benefit cuts for everyone.

This is arguably a risky strategy. Some progressives will likely object that Biden is accepting the GOP’s framing of a “debt crisis” and of Medicare insolvency, much as the Obama administration did in 2011 during the Republican-manufactured “debt crisis” that led to a government shutdown and a near default. Other Democrats will flinch at Biden’s happy embrace of a tax increase, however (relatively) popular it might be when limited to the wealthy.

But Biden has clearly calculated that remaining on the offensive is the way to avoid the big mistake the Obama administration made in entertaining GOP “solutions” to the “crisis,” giving the Republicans bipartisan cover for the extremely unpopular positions they had embraced. Instead, Biden keeps hammering away at the weakest spots of their fiscal hawkery. He said in his op-ed:

MAGA Republicans have a different view. They want to repeal the Inflation Reduction Act. That means they want to take away the power we just gave to Medicare to negotiate for lower prescription drug prices. Get rid of the $35 per month cap for insulin we just got for people on Medicare. And remove the current $2,000 total annual cap for seniors.

If the MAGA Republicans get their way, seniors will pay higher out-of-pocket costs on prescription drugs and insulin, the deficit will be bigger, and Medicare will be weaker. The only winner under their plan will be Big Pharma. That’s not how we extend Medicare’s life for another generation or grow the economy.

You can expect Biden to continue this line of attack when his full budget is released. But it says a lot that he chose to begin his budget messaging with a stark partisan choice on Medicare. Beyond this year’s largely symbolic debates in a gridlocked Congress, it shows that Republican plans to run against Old Slow Joe in 2024 may have underestimated the 46th president.