He could have said something like “If a deal isn’t made there will of course be a problem paying for Social Security in the long term, but in the short term I have many options as far as shuffling dollars around to fund high priorities, so I can say with confidence that Americans who depend on Social Security will still get their checks for the foreseeable future while we sort this out.” But Obama didn’t say that.

From CBS News by way of Snapped Shot:

President Obama on Tuesday said he cannot guarantee that retirees will receive their Social Security checks August 3 if Democrats and Republicans in Washington do not reach an agreement on reducing the deficit in the coming weeks.

“I cannot guarantee that those checks go out on August 3rd if we haven’t resolved this issue. Because there may simply not be the money in the coffers to do it,” Mr. Obama said in an interview with CBS Evening News anchor Scott Pelley, according to excerpts released by CBS News.

I haven’t seen the full interview, but I’m just guessing that Pelley aggressively followed up with, “Mmm hmm…”

Regardless of what happens with the debt ceiling deal, if Social Security checks don’t get sent out next month, it will be the decision of the Obama administration to not put Social Security toward the top of their list of priorities (I thought it was the GOP who wanted to starve seniors and push them off cliffs).

Hopefully Social Security recipients are familiar with chess, because they’re now officially pawns in the president’s debt ceiling game.

Update: Reader James sent in questions he’d have followed up with:

Are you saying that we must increase the debt limit each year so that we can pay SS and the other entitlement programs?

If we have to increase the debt limit each year so as to pay for the entitlement programs, how are we ever going to get our financial ship in order?

*****

**Written by Doug Powers

Twitter @ThePowersThatBe

President Bush unveiled a $3.1 trillion budget on Monday that supports sizable increases in military spending to fight the war on terrorism and protects his signature tax cuts.

The spending proposal, which shows the government spending $3 trillion in a 12-month period for the first time in history, squeezes most of government outside of national security, and also seeks $196 billion in savings over the next five years in the government’s giant health care programs – Medicare for the elderly and Medicaid for the poor.

Even with those savings, Bush projects that the deficits, which had been declining, will soar to near-record levels, hitting $410 billion this year and $407 billion in 2009. The all-time high deficit in dollar terms was $413 billion in 2004….

…Even some Republicans faulted Bush’s budget sleight of hand.

“They’ve obviously played an inordinate number of games to try to make it look better,” Sen. Judd Gregg, the top Republican on the Budget Committee, said in an interview with The Associated Press. “Let’s face it. This budget is done with the understanding that nobody’s going to be taking a long, hard look at it,” said Gregg, R-N.H.

Bush’s spending blueprint sets the stage for what will probably be epic battles in the president’s last year in office, as both parties seek to gain advantages with voters heading into the November elections. The 6 percent overall increase in spending for 2009 reflects a continued surge in spending on the government’s huge benefit programs for the elderly – Social Security and Medicare, even with the projected five-year savings of $196 billion over five years. Those savings are achieved by freezing payments to hospitals and other health care providers. A much-smaller effort by Bush in this area last year went nowhere in Congress.

***

FWIW, here’s House Republican Whip Roy Blunt’s statement on the budget.

“The president this morning gave Congress a clear sense of the priorities he intends to pursue on behalf of the American people this year, and I’m glad to see that securing our borders, strengthening our Armed Forces, and promoting broad-based, pro-growth tax relief sit atop his list.

“It’s an agenda that stands in stark contrast to the one advanced by congressional Democrats this past year – a platform that, as its centerpiece, sought to impose the largest tax hike in the nation’s history on hard-working American families. More than $250 billion in new taxes later, it appears Democrats in at least one critical area accomplished exactly what they set out to do.

“As the nation’s first-ever $3 trillion budget, it goes without saying there are many places where I believe we can and should spend much less. As the process moves forward, Republicans look forward to playing a prominent role in that important debate.

“The president’s budget request represents the start of a long, and at times, treacherous process that governs the way government spends taxpayer money. It’s now up to Democrats to demonstrate their commitment to spending that money in a manner that’s worthy of the hard-work and thrift it took everyday Americans to generate it in the first place. A good start would be crafting a sensible budget plan of their own, something they failed to produce last year.”

Above all, Bush was honest and even courageous about Social Security. Social Security is about writing checks: Money goes in, money goes out. As Bush has discovered in the last few months, there are no shadows to hide in while you fiddle with it. The problem is fewer and fewer workers supporting more and more retirees, and there are only two possible solutions: Someone has to pay more in, and/or someone has to take less out.

On Thursday, Bush didn’t exactly go from explicitly denying this to explicitly admitting it. But he went from implicitly suggesting that his privatization scheme is a pain-free solution to implicitly endorsing a plan for serious benefit cuts. For a politician, that’s an admirable difference.

Even more to Bush’s credit, the plan he’s backing is highly progressive. Benefits for low- income workers would keep rising with average wages, as now, but benefits for middle- and high-income people would be geared more toward merely keeping up with inflation. This allows Bush to say that no one’s benefits would be cut, although some people would be getting up to 40% less than they are currently promised. But in the swamp of Social Security politics, that is really minimal protection from the alligators.

So Democrats now face a choice: Are they going to be alligators on this one? Why Bush has taken this on remains a mystery. There is no short-term political advantage, and there are other real long-term problems that are more pressing. But he has done it, to his credit.

Obviously, I don’t agree with everything in Kinsley’s column. In particular, his assertion that Bush’s plan would “alienate people from the Republican Party for generations” is over the top. Nevertheless, it’s refreshing to read a liberal commentator who doesn’t base his arguments solely on DNC talking points.

Here’s Josh Marshall:

let’s state specifically what this to-some-sexy-sounding proposal offers: steep benefit cuts for all but the lowest income Americans and meager increases in benefits for them. It’s hard to see how there’s anything particularly progressive about gutting Social Security for the entire middle class.

Armando at Daily Kos:

Yes, give the wealthiest a huge tax cut by repealing the estate tax. Screw the middle class by cutting their future social security benefits. Typical BushCo approach.

And Atrios:

Bush has not proposed increasing benefits for very low income workers. He’s just proposed not cutting them – and cutting everyone else’s a lot.

As I noted below, Bush’s indexing plan guarantees middle- and upper-income retirees the same level of benefits they get now (after adjusting for inflation). Their benefits would not, however, grow above the rate of inflation, as is the case under the status quo.

The savings would be used to allow working people of all income levels to set aside some of their Social Security taxes into private retirement funds. Under reasonable assumptions about investment returns, those accounts could be worth hundreds of thousands of dollars 40 years from now.

There was a time when liberals could be counted on to defend the interests of working class Joes. Marshall and the others are now taking the exact opposite position. They are saying, in effect, that ensuring ever-increasing benefits for well-to-do retirees is more important than promoting the financial well-being of young working people.

Democrats claim that Bush’s plan constitutes a “cut” in future benefits for upper-income workers. That claim is being uncritically echoed by most MSM outlets:

New York Times, “Bush Cites Plan That Would Cut Social Security Benefits,”

President Bush called Thursday night for cutting Social Security benefits for future retirees to put the system on sound financial footing, and he proposed doing so in a way that would demand the most sacrifice from higher-income people while insulating low-income workers.

Washington Post, “Bush Social Security Plan Would Cut Future Benefits,”

President Bush called on Congress last night to curtail future Social Security benefits for all but low-income retirees in an urgent new effort to address the popular program’s shaky finances.

ABC News / Associated Press, “Bush Offers New Social Security Plan,”

After nearly 60 days on the road pitching Social Security changes, President Bush is offering a new plan to fix its finances by cutting benefits of more prosperous future retirees. Democrats still aren’t buying it.

Not surprsingly, liberal blogger Josh Marshall loves this slanted coverage: “The Post pretty much nails the new Bush plan on the front page of tomorrow’s paper: cut pretty much everyone’s benefits a lot. The sweetener? Poor people’s benefits won’t be cut as much!”

If you read the New York Times, Washington Post, Associated Press, and liberal bloggers like Marshall you could be forgiven for thinking that, under Bush’s plan, wealthy retirees will get less money in the future than they do now. That is not the case.

A few MSM outlets made this point. The Wall Street Journal reported, “Under his proposal to adjust benefit levels, low-income workers would continue, as they do under current law, to have their initial retirement benefits linked to the growth of wages in the economy. But the wealthiest seniors would have their initial benefits tied to price inflation, which generally rises more slowly than wages.”

See also this USA Today analysis.

Yes, Bush’s indexing plan is “cutting benefits” in the sense that upper-income beneficiaries would get less money than under the status quo. But no retiree is going to see his or her standard of living decline relative to where it stands now.

Those who oppose Bush’s indexing plan are arguing, in essence, that Social Security benefits to upper-income beneficiaries should continue to grow faster than the rate of inflation. That’s reckless given the program’s long-term fiscal problems.

Bush’s indexing plan is moderate and reasonable. Unfortunately, the combination of Democrats’ demagoguery and the MSM’s relentlessly negative coverage may bring the plan down before it even gets off the ground.