Appearing on Fox News Live with host Arthel Neville, ND2.0 Editor Lynn Parramore notes that many progressives see Obama "as a defector" who has been dragged to the right of the American people by Tea Party extremists. In particular, she says progressives worry that he will give in to Social Security hysteria and enact cuts that would betray the legacy of the New Deal.

Although the deal averts a painful default, many of the cuts will fall on the backs of struggling women.

The debt ceiling debate has finally come to a close. We are clearly all better off in a country that doesn't default on its debt because of self constraints and intense partisan bickering.

But the deal that was struck and signed into law by President Obama that averted the default will have painful repercussions for many of the less well off and vulnerable. It calls for $2.4 trillion in spending cuts over the next 10 years, as well the creation of a bipartisan Congressional committee that will be charged with proposing another $1.5 trillion in deficit reduction. This is in exchange for a two-step increase in the debt ceiling, averting the chaos of a US default. These cuts will harm many groups, but there are a number of ways they'll hurt women specifically.

The first, immediate $1 trillion in cuts come from capping discretionary spending, with more than half non-defense -- i.e. mostly shielding the Pentagon. The White House has said these caps "will put us on track to reduce non-defense discretionary spending to its lowest level since Dwight Eisenhower was President" in the 1950s. But what falls under "non-defense discretionary spending"? While the category sounds amorphous, it funds real programs that women rely on. As the National Women's Law Center puts it,

The discretionary portion of the federal budget requires annual appropriations to fund programs that help women protect their health, obtain quality child care and higher education, and help them meet their basic needs during difficult times and as they age -- including Head Start, child care, K-12 education, family planning and other women's health services, domestic violence prevention, job training, Pell grants, and services for the elderly.

Specifically, some of the largest portions of this spending directly affect women. Education is the largest (16.3%), and cuts to this funding mean teacher layoffs among other things. The category that includes child care and education and nutrition assistance is quite substantial at 7.6%, hitting women who rely on subsidies as they struggle to raise their children.

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The next level of cuts will come from the so-called "super-committee" that will propose another $1.5 trillion in reductions over ten years. Those recommendations could very well include further cuts to discretionary programs, as well as cuts to entitlements and revenue increases. Beyond being hit by cuts to discretionary spending, women will get smacked by scaling back entitlement programs. They rely heavily on these programs: in 2007, they were about 70% of the elderly and 80% of younger adults who relied on Medicaid; they make up more than half of those with Medicare; and for nearly three in ten women 65 and older who receive Social Security, it's their only source of income.

And women will get hit one more way: in the trickle down effects from the deal. It doesn't call for immediate cuts to the federal workforce, but as government agencies and programs have to cope with smaller budgets, they may have to turn to furloughs or layoffs. On top of this, mayors and governors are anticipating far less aid from the federal government to help them cope with budgets ravaged by falling tax revenues and rising output for unemployment and other benefits caused by high unemployment. Their tight budgets have already lead to huge layoffs in public sector workers. Women make up over half of the public workforce -- and have lost 343,000 public-sector jobs, accounting for 70 percent of the cuts between June 2009 and June 2011. This is a big factor in why women are losing jobs during the recovery while men are making gains (even if they're small). Further shrinking government budgets will ensure women lose more jobs.

Overall, the country is better for a deal that averted a government default. In that scenario, everyone would have been hit by higher interest rates at the very least. But the deal itself hurts women at a time when everyone is already suffering.

Bryce Covert is Assistant Editor at New Deal 2.0.

President Obama's proposed debt ceiling deal is a disastrous solution to an imaginary fiscal crisis, but the pain it causes will be all too real.

News reports hold that President Obama scored a political victory by agreeing to put Medicare and Social Security on the chopping block to achieve a “go-big” $4 trillion deficit reduction. Speaker Boehner had to concede that Republicans won’t vote for any package that includes tax increases – and the deal died. So the gambit worked and the President emerged with a solid image as the alpha deficit hawk.

To which one can only say: how nice for him.

We’re in a summer that only Salvador Dali could paint, a reality so twisted that one almost yearns for the simple verities of the War on Terror or even the invasion of Iraq. Then as now, to be serious one must be a “hawk.” (The dove is a weakling, a loser, and the owl for practical purposes does not exist.) So let’s review some of the strange and mysterious faces of this ugly, vicious bird.

The debt ceiling was first enacted in 1917. Why? The date tells all: we were about to enter the Great War. To fund that effort, the Wilson government needed to issue Liberty Bonds. This was controversial, and the debt ceiling was cover, passed to reassure the rubes that Congress would be “responsible” even while the country went to war. It was, from the beginning, an exercise in bad faith and has remained so every single second to the present day.

Today this bad-faith law is pressed to its absurd extreme, to force massive cuts in public programs as the price of not-reneging on the public debts of the United States. Never mind that to force default on the public obligations of the United States is plainly unconstitutional. Section 4 of the 14th amendment says in simple language that public debts, once duly authorized by law and including pensions, by the way, “shall not be questioned.” The purpose of this language was to foreclose, to put beyond politics, any possibility that the Union would renege on debts and pensions and bounties incurred to win the Civil War. But the application is very general and the courts have ruled that the principle extends to the present day.

What is going on in Congress at this moment already violates that mandate. It is an effort to subvert the authority of the government to meet and therefore to incur obligations of every possible stripe. It is an attack on the concept of government itself – as the “Tea Party” by its very name would no doubt agree. It therefore paints those deficit hawks who are using the debt ceiling to take budget hostages as enemies of the United States Constitution.

The President, though supposedly a constitutional expert and though sworn to “preserve, protect and defend” the Constitution, will not say this. Instead he appears to treat the Constitution as an optional matter, to which he will not resort, in the hope that by negotiating with the hostage- takers he can reach some reasonable outcome that will preserve everyone’s good name. (The great Harvard legal scholar Laurence Tribe recently argued that the President cannot defy the debt ceiling on his own. That’s a debatable point.) It is as though Lincoln in 1861 faced with the siege of Sumter had sat down with Confederate commissioners to see what could be worked out.

In Washington it appears that this assault on government has a large measure of elite and media support, if not on the crass details or vulgar personalities but because it could conceivably force the parties to do “what they should do anyway” – namely come to a long-term deficit and debt agreement. Such an agreement would cut spending, raise some taxes, put the projected debt-to-GDP ratio on a declining track, and solve the “government’s fiscal crisis.”

What fiscal crisis? The great unasked question in this summer of sound-and-fury is “why?” The United States has many problems at the moment: a high-and-stubborn unemployment rate, a foreclosure catastrophe, a slowing economy that has not recovered and will not recover from the Great Crisis, and the ongoing challenges of infrastructure, energy and climate change. Fiscal crisis? The entire thing is a figment, made up of wise-men’s warnings repeated endlessly and linked to the projections of technicians at the Congressional Budget Office and elsewhere.

The projections, as I’ve written here, are made up of two economically impossible arguments. One is that there will be a big economic rebound, restoring near-full employment by 2013 or so. We’re already off that track, as some of us warned from the beginning. Of course, a recovery would reduce the deficit even if nothing were done. But CBO then recreates the exploding debt by assumptions, which include steady growth and low inflation, but sharply higher health-care costs and much higher short-term interest rates. These lead the projected debt to compound skyward, soon surpassing all previous records in relation to GDP.

Is this possible? No it is not. The Federal Reserve would never raise the short-term interest rate as CBO projects, without a prior increase of inflation, which CBO assumes will not occur. If they did, the economy would collapse! And if they don’t, the debt does not compound out of control. I have presented these simple numbers here. For what it’s worth, if you believe the capital markets signal anything, they signal their disbelief in doomsday forecasts, in the long-term interest rate on US government bonds, every single day.

Is it possible that cutting government is, by some other path, the way to economic recovery?

There are many people who believe fervently in the resilience of the private sector and for whom government is just a burden. Some of those people are pure predators: resource magnates, media magnates, banking magnates. Others have blinded themselves to the role government actually plays in sustaining the advanced networks, human protections and social systems that make up our lives, and imagine that one can go back to the world of subsistence farming, church charity and credit from the corner store. But there were many fewer people in that world, they didn’t do what we do, and they didn’t live nearly so long.

In broad terms, today’s government does four major things:

– it provides for the national defense.

– it purchases goods and services from the private economy for a wide range of public purposes, most of them individually quite small-scale in relation to GDP.

– it regulates a wide range of private-sector activity, for safety, health, environmental and other purposes, including financial stability – or so one should hope.

– it administers Social Security, Medicare and Medicaid, as well as other pension and health benefit programs.

On what grounds are any of these functions too large? As an economist concerned with peace and security issues, I do believe we would be better off ending the wars in Iraq and Afghanistan quickly, that we could dispense with the real resource costs of many foreign bases, aircraft carrier groups, fighter aircraft and submarines and nuclear weapons left over from the Cold War. But these are security judgments, not broad economic ones. In other words, I would not cut a single dime of Pentagon spending that was actually necessary to defend the United States, in order supposedly to lower the interest rate on federal debt.

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By the same reasoning, why should we cut transportation, or public health, or environmental protection, or scientific research, or bank inspectors or funds that support the public schools? One can argue these matters program by program - and one should. (I would happily cut ethanol subsidies and oil company tax breaks, for starters.) But there is no economic case for placing an overall limit, and it is obvious that the 500,000 public sector workers – including many teachers, police, fire and park rangers and librarians – who have lost their jobs since 2009 were doing good and useful things that are now missed. If sacking them had been good for the economy, we would be having a stronger recovery than we are.

Finally there are Social Security, Medicare and Medicaid. Unlike the military or the transportation program, Social Security is not a government purchasing program. It therefore takes nothing directly from the private sector. What it does, is provide insurance: it protects workers from poverty in old age, whether or not their families would otherwise be willing and able to support them. And it taxes all workers, whether or not they would otherwise be burdened with elderly parents, or survivors, or the disabled, to support. Along with Medicare and Medicaid, Social Security is a powerful protector of the entire working population – young and old. It redistributes purchasing power, in loose relation to past earnings, in a way that meets the basic needs of a large number of Americans who would otherwise, in many millions of cases, be destitute or medically bankrupt.

What economic purpose would cutting such programs serve? To do so would again redistribute incomes. Many of the future elderly would be much worse off, and of course many would die younger than they otherwise would. Survivors and the disabled would suffer as well. In return, what would the federal government and the country gain? A release of real resources to the private sector? Social Security does not take real resources from the private sector! Lower interest rates? The idea is absurd, and not just because interest rates are low today. The notion that cutting Social Security would help keep interest rates down is absurd because interest rates are set in a way that has no relationship at all to the scale of Social Security, Medicare or Medicaid.*

This argument has nothing to do with the trope, oft-repeated and perfectly true, that the Social Security system does not contribute to the deficit. It would not matter if it did. The important question is: are benefits too high? Obviously not. How about payroll taxes - are they too low? There is no case for that either. One of the very few bright spots in recent policy was the decision to reduce payroll taxes on employees, temporarily, while leaving Social Security benefits alone.

If you wanted to build on that, the right steps would be to lower – not raise – the Social Security early retirement age, permitting for a few years older workers to exit the labor force permanently on better terms than are available to them today. This together with a lower age of access to Medicare would work quickly to rebalance the labor force, reducing unemployment and futile job search among older workers while increasing job openings for the young. It is the application of plain common sense. And unlike all the pressures to enact long-term cuts in these programs, it would help solve one of today’s important problems right away.

Instead of this, what do we have, from a President who claims to be a member of the Democratic Party? First, there is the claim that we face a fiscal crisis, which is a big untruth. Second, a concession in principle that we should deal with that crisis by enacting massive cuts in public services on one hand and in vital social insurance programs on the other. This is an arbitrary cruelty. Third, a refusal to stand on the strong ground of the Constitution, against those whose open and declared purpose is tear that document and the public credit to shreds.

In the Daily Beast on Sunday, Howard Kurtz wrote in optimistic terms of the prospects for a deficit bargain: “But away from the cameras, even sharp-tongued politicians recognize the imperative of avoiding the fate of Greece. It is a sign of the times that the Kabuki players of Washington may take a bow simply for averting catastrophe.”

Kurtz did not say that the big Kabuki here was his own notion that somehow the United States might face the fate of Greece – a small and overmatched member of a currency zone it cannot control. He did not say that the catastrophe he fears – a default on US government obligations – was entirely the product of treacherous politics, abetted by an irresolute President who seems not to grasp the danger of allowing the Constitution to fail.

And he did not say, that the deal he would applaud, with cuts to Social Security, Medicare, Medicaid and all the legitimate and necessary functions of government — would be for millions of Americans the catastrophe itself.

* Short-term rates are whatever the Federal Open Market Committee dictates they should be. And if the Treasury wants to pay low interest rates on the debt, it can always issue short-term debt only -- or it can issue long bonds and the Federal Reserve can buy them back, maintaining the structure of interest rates it prefers. There is no market default risk, no threat to “solvency” from a “loss of confidence” – nothing the private sector can do to make the US government pay more than it wants do – a point that should be obvious from the fact that the Federal Reserve’s interest rate decisions are never overruled by the market. The only way the United States government can default is if it makes a political decision to do so – which is what the debt-ceiling hostage-takers threaten and what the Constitution forbids.

James K. Galbraith is a deficit owl. He is the author of The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too. He teaches at The University of Texas at Austin.

Last night, rumors began flying that the president would offer cuts to Social Security as part of a deal to raise the debt ceiling. The administration is now trying to stem the tide of outrage, suggesting that the President merely wants to "strengthen" Social Security.  Never mind that as Roosevelt Institute Senior Fellows Robert Johnson and Thomas Ferguson have clearly shown, the program is strong today and predictions about shortfalls decades down the road are wildly exaggerated. We asked Roosevelt fellows and friends to weigh in on the Social Security fracas.

Richard Kirsch, Senior Fellow at the Roosevelt Institute:

"Here are three numbers that tell the whole story on Social Security: $14,000; 90%; $0.

$14,000 is the average amount that a retiree gets a year from Social Security. A related number is 19.8 million, the number of people (including retirees; surviving spouses and the disabled) who are kept above the already skimpy federal poverty line because they collect even those low Social Security payments. Social Security makes up 90% or more of income for one-third of older Americans and 50% of income for half of retirees.

90% is the proportion of earnings that, if taxed at that level, would assure that Social Security is fully solvent for the next 75 years. For years that was the share of earnings on which workers paid Social Security, but the current level is closer to 83%. While middle-income wages have stagnated, upper incomes have grown rapidly, so that the Social Security cap of $106,800 in 2011 (the same as in 2010) is applied to a lower portion of earnings than it has been historically.

$0 is the amount that Social Security has contributed to the federal deficit. Ever.

Marshall Auerback, Senior Fellow at the Roosevelt Institute:

"Cutting Social Security is 'Change you can believe in' - if you're a member of the GOP. If the rumors are true, then President Obama would be taking policy decisions in areas where even Reagan and Bush dared not to tread. Cutting Social Security and Medicare on the back of a debt ceiling which might well be unconstitutional would certainly take his party out of its comfort zone (as he phrased it the other day). But it would also effectively eviscerate one of the Democrats' most substantive social welfare achievements of the 20th century. Social Security is not "broken." It is not "going broke." It will, as Robert Eisner told us more than a decade ago, "be there" as long as we protect it from its so-called saviors. The balance in the Social Security Trust Fund is absolutely irrelevant when it comes to the government's ability to make payments, in full and on time - today, tomorrow and forever. Even Alan Greenspan has acknowledged that "A government cannot become insolvent with respect to obligations in its own currency."

Doesn't anyone remember 1983, the last time we saw 'incremental reforms' of the kind many 'responsible politicians' supported? As a result of those 'reforms', today's workers are contributing more and retiring later. And for what? Those reforms were supposed to make the system solvent for 75 years. Now, here we are, less than three decades later and it's still 'broken'? And we're supposed to believe that further incremental cuts will succeed"

ND20 Contributor Harvey J. Kaye, Professor of Democracy and Justice Studies at the University of Wisconsin-Green Bay:

"Obama's rumored move to cut into Social Security in order to get the GOP to accept tax increases leaves me speechless. So, I turn to history and grab hold of words past, starting with Eisenhower's letter to his brother in November 1954:

'Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas.'

Obama must keep in mind now that it's difficult for many Americans to imagine that a party in power that raises taxes and cuts social security will win at the polls next time around - or even should. If he supports Social Security cuts, what will Obama's 2012 campaign ads say???

Over and over again, we hoped that Obama would become what he was never capable of becoming; indeed, that he would stand firm, make his case, and call out Americans to protest the anti-democratic ambitions of the GOP. Paul Krugman warned us... John Judis warned us ... Still, we hoped he would live up to his billing as the next FDR and initiate a new New Deal; but he didn't. Then we hoped he would follow Harry Truman's example after the debacle of 1946 and turn left. But he hasn't. Hell, we even hoped he might at least learn from the centrist Bill Clinton, who resisted the Gingrich Revolution (at least for awhile ). But now we see that he's more like Jimmy Carter - and may, like him, serve only one term."

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Lynn Parramore, Media Fellow at the Roosevelt Institute and Editor of New Deal 2.0:

Americans know that they have been ripped off. They've seen bank CEOs making record-breaking profits and then they hear talk of cutting Social Security and other programs that keep millions of people out of poverty. They know it doesn't add up. The current hysteria over the deficit is an opportunity for elites to rob ordinary people all over again. Bankers want their hands on our Social Security because there are windfall profits ready for the taking if our retirement money is put into private accounts -- just think of the fees they can charge! That's why the paltry $14K per year that Americans can now expect on average in their retirement years -- in a time of declining pensions and economic uncertainty -- is something that the financial fatcats just can't resist getting their paws on. Keeping us poor and insecure is also a means of driving our wages down and insuring that we will work for peanuts. Financial elites are lying to the American people about the 'cost' of Social Security and the program's future, and they are spending money hand over fist to get politicians on board with their propaganda. Any American president who serves the people must resist this attack on the dignity, well-being, and economic rights of our citizens. Full stop.

William K. Black, ND20 Contributor and Associate Professor of Economics and Law at the University of Missouri – Kansas City:

Tom Ferguson warned us -- in person, unequivocally, forcefully, and repeatedly.

What I certainly did not understand was that at a time when the Republicans had locked themselves in a politically disastrous position and in light of the NY special election showing the political advantages of holding firm on this type of program (I put aside the fact that Social Security is an immense success on the merits because it is clear the administration does not care about the merits) -- Obama would choose to seize defeat from victory. Geithner has proven to be the perfect Republican mole.