Ludicrous and Cruel: America Is Being Punked By GOP Voodoo Economics
Many commentators swooned earlier this week after House Republicans, led by the Budget Committee chairman, Paul Ryan, unveiled their budget proposals. They lavished praise on Mr. Ryan, asserting that his plan set a new standard of fiscal seriousness.
Well, they should have waited until people who know how to read budget numbers had a chance to study the proposal. For the G.O.P. plan turns out not to be serious at all. Instead, it’s simultaneously ridiculous and heartless.
How ridiculous is it? Let me count the ways — or rather a few of the ways, because there are more howlers in the plan than I can cover in one column.
First, Republicans have once again gone all in for voodoo economics — the claim, refuted by experience, that tax cuts pay for themselves.
Specifically, the Ryan proposal trumpets the results of an economic projection from the Heritage Foundation, which claims that the plan’s tax cuts would set off a gigantic boom. Indeed, the foundation initially predicted that the G.O.P. plan would bring the unemployment rate down to 2.8 percent — a number we haven’t achieved since the Korean War. After widespread jeering, the unemployment projection vanished from the Heritage Foundation’s Web site, but voodoo still permeates the rest of the analysis.
In particular, the original voodoo proposition — the claim that lower taxes mean higher revenue — is still very much there. The Heritage Foundation projection has large tax cuts actually increasing revenue by almost $600 billion over the next 10 years.
A more sober assessment from the nonpartisan Congressional Budget Office tells a different story. It finds that a large part of the supposed savings from spending cuts would go, not to reduce the deficit, but to pay for tax cuts. In fact, the budget office finds that over the next decade the plan would lead to bigger deficits and more debt than current law.
And about those spending cuts: leave health care on one side for a moment and focus on the rest of the proposal. It turns out that Mr. Ryan and his colleagues are assuming drastic cuts in nonhealth spending without explaining how that is supposed to happen.
How drastic? According to the budget office, which analyzed the plan using assumptions dictated by House Republicans, the proposal calls for spending on items other than Social Security, Medicare and Medicaid — but including defense — to fall from 12 percent of G.D.P. last year to 6 percent of G.D.P. in 2022, and just 3.5 percent of G.D.P. in the long run.
That last number is less than we currently spend on defense alone; it’s not much bigger than federal spending when Calvin Coolidge was president, and the United States, among other things, had only a tiny military establishment. How could such a drastic shrinking of government take place without crippling essential public functions? The plan doesn’t say.
And then there’s the much-ballyhooed proposal to abolish Medicare and replace it with vouchers that can be used to buy private health insurance.
The point here is that privatizing Medicare does nothing, in itself, to limit health-care costs. In fact, it almost surely raises them by adding a layer of middlemen. Yet the House plan assumes that we can cut health-care spending as a percentage of G.D.P. despite an aging population and rising health care costs.
The only way that can happen is if those vouchers are worth much less than the cost of health insurance. In fact, the Congressional Budget Office estimates that by 2030 the value of a voucher would cover only a third of the cost of a private insurance policy equivalent to Medicare as we know it. So the plan would deprive many and probably most seniors of adequate health care.
And that neither should nor will happen. Mr. Ryan and his colleagues can write down whatever numbers they like, but seniors vote. And when they find that their health-care vouchers are grossly inadequate, they’ll demand and get bigger vouchers — wiping out the plan’s supposed savings.
In short, this plan isn’t remotely serious; on the contrary, it’s ludicrous.
And it’s also cruel.
In the past, Mr. Ryan has talked a good game about taking care of those in need. But as the Center on Budget and Policy Priorities points out, of the $4 trillion in spending cuts he proposes over the next decade, two-thirds involve cutting programs that mainly serve low-income Americans. And by repealing last year’s health reform, without any replacement, the plan would also deprive an estimated 34 million nonelderly Americans of health insurance.
So the pundits who praised this proposal when it was released were punked. The G.O.P. budget plan isn’t a good-faith effort to put America’s fiscal house in order; it’s voodoo economics, with an extra dose of fantasy, and a large helping of mean-spiritedness.
By: Paul Krugman, Op-Ed Columnist, The New York Times, April 7, 2011
No More Fence Straddling: Even Moderates Should Condemn Paul Ryan’s Budget
Political moderates and on-the-fencers have had it easy up to now on budget issues. They could condemn “both sides” and insist on the need for “courage” in tackling the deficit.
Thanks to Rep. Paul Ryan’s budget and the Republicans’ maximalist stance in negotiations to avert a government shutdown, the days of straddling are over.
Ryan’s truly outrageous proposal, built on heaping sacrifice onto the poor, slashing scholarship aid to college students and bestowing benefits on the rich, ought to force middle-of-the-roaders to take sides. No one who is even remotely moderate can possibly support what Ryan has in mind.
And please, let’s dispense with the idea that Ryan is courageous in offering his design. There is nothing courageous about asking for give-backs from the least advantaged and least powerful in our society. It takes no guts to demand a lot from groups that have little to give and tend to vote against your party anyway.
And there is nothing daring about a conservative Republican delivering yet more benefits to the wealthiest people in our society, the sort who privately finance the big ad campaigns to elect conservatives to Congress.
Ryan gives the game away by including the repeal of financial reform in his “budget” plan. What does this have to do with fiscal balance? Welcome to the Wall Street Protection Act of 2011.
Oh, yes, and this budget has nothing to do with deficit reduction. Ryan would hack away at expenditures for the poor. The Center on Budget and Policy Priorities estimates he gets about two-thirds of his $4.3 trillion in actual cuts from programs for low- income Americans. Note that this $4.3 trillion almost exactly matches the $4.2 trillion he proposes in tax cuts over a decade. Welcome to the Bah Humbug Act of 2011.
But you’d expect a progressive to feel this way. What’s striking is that Ryan is pushing moderates to stand up for a government that will have enough money to perform the functions now seen as basic in the 21st century. These notably include helping those who can’t afford health insurance to get decent medical care, a goal Ryan would have the government abandon, slowly but surely.
Erskine Bowles and Alan Simpson, the co-chairs of the deficit commission and the heroes of the budget-cutting center, put out a statement saying some nice things about the idea of the Ryan budget. They called it “serious, honest, straightforward,” even though there is much about its accounting that is none of those.
But then they got to the real point, declaring themselves “concerned that it falls short of the balanced, comprehensive approach” needed for bipartisan accord because it “largely exempts defense spending from reductions and would not apply any of the savings from eliminating or reducing tax expenditures as part of tax reform to deficit reduction.”
Ryan, they argued, “relies on much larger reductions in domestic discretionary spending than does the commission proposal, while also calling for savings in some safety-net programs — cuts which would place a disproportionately adverse effect on certain disadvantaged populations.”
This is much like what I said, with an added layer of diplomacy. When even deficit hawks begin choking, however politely, on a proposal whose main motivation is ideological, you know there is an opening for a coalition between moderates and progressives on behalf of sane, decent government.
The Republican approach to shutdown talks should reinforce this possibility. Democrats have nearly given away the store to avoid a crackup, yet Republican leaders, under pressure from their right wing, have continued to ask for more and more and more. My word, even President Obama has finally gotten impatient.
However the shutdown saga ends, the negotiating styles of the two sides ought to tell moderates that they can no longer pretend that the two ends of our politics are equally “extreme.” No, conservatives are the ones who’ve been radicalized. The Ryan budget is definitive evidence of this.
It is conservatives who would transform our government from a very modestly compassionate instrument into a machine dedicated to expanding existing privileges while doing as little as possible for the marginalized and the aspiring — those who, with a little help from government, might find it a bit easier to reach for better lives.
Moderation involves a balance between government and the private sector, between risk and security, between our respect for incentives and our desire for greater fairness. The war against moderation has begun. Will moderates join the battle?
By: E. J. Dionne, Opinion Writer, The Washington Post, April 6, 2011
‘Government Shutdown Prevention Act’ Undermines Democracy
Legal training is not a requirement to serve in Congress, although many of the members are, and have been, lawyers. Nor is it necessary for a House or Senate member to have served in another government post, although many have, and their experience at forging alliances and compromises has been helpful. We no longer have literacy tests for voters, a technique southern states used until the 1960s, effectively to disenfranchise African-American voters.
Yet, it might not be a bad idea to require incoming members of Congress to take a basic test in civics.
How else, other than an alarming misunderstanding of the basic of American government, to explain the effort of House Republicans to shut the Senate out of the budget process? Their sanctimoniously titled “Government Shutdown Prevention Act” would do just that, deeming that if the Senate failed to pass a measure to keep the government running amid the current budget dispute, that the House-passed version would become law.
The idea is bizarre on so many levels—not least because the Senate would actually have to pass the Government Shutdown Prevention Act for the House to assume a dictatorial role in one of the three branches of the world’s greatest democracy. The current fashion of anti-intellectualism in politics aside, do the House Republicans not understand the elementary-school fundamentals of how a bill becomes a law.
The freshman GOP lawmakers are annoyed with the Democratic-controlled Senate, this time for failing to cave in on the dramatic cuts the House Republicans want in the budget. Join the club, folks: The House has long been irritated by the Senate. Ask the House Democrats, who approved more than 300 bills in the last Congress that ended up dying in a Senate that failed to pass them or even consider them.
But the rudimentary lesson of lawmaking (FYI—a bill has to be passed by both the House and the Senate, then signed by the president, to become law. If the president vetoes a bill, each chamber of Congress must summon a two-thirds majority to override the veto) are nowhere near as important as the lesson about getting things done in a country of diverse interests. The Tea Party crowd ran campaigns of anger and frustration, blaming Congress for its failure to get balanced budgets and myriad other things. There’s a reason for that, and it’s not because members are stupid (they’re not, and some of them are absolutely brilliant) or lazy (they work longer hours than most Americans imagine) or weak. It’s because this is a country of wildly divergent attitudes and perspectives, reflected in the lawmakers those citizens send to Congress. The Tea Partyers believe they were sent to Washington with a mission, and they likely were. So were Nancy Pelosi and other liberal members whose constituents have drastically different perspectives than those in the Tea Party team’s districts. And their views are no less valid.
Legislating requires compromise, and compromise is hard, especially during times of economic stress. Being a congressman is a difficult job, forcing them to balance their districts’ needs with the national interest. The new members signed up for this job. They should do it.
By: Susan Milligan, U.S. News and World Report, April 1, 2011
Government by the Week: Is A Government Shutdown The End-Game For The GOP?
Parents have begun arranging alternative child care for their preschoolers, uncertain of whether their Head Start program will be there when they need it. The Social Security Administration is unable to open new hearing offices to handle a backlog of appeals. The Pentagon has had to delay equipment repairs. There is chaos throughout the federal government, as Robert Pear reported in The Times on Tuesday, because a riven Congress has forced agencies to operate on a week-by-week basis.
Yet, on Tuesday, the House passed another short-term spending bill. This one keeps things going for all of three weeks. The Senate will almost certainly join in shortly to avoid an impending shutdown on Friday, the result of the stopgap bill from two weeks ago.
These slipshod exercises in governance were choreographed by House Republicans, who knew that neither the Senate nor President Obama would ever accept their original proposal to gut nonsecurity discretionary spending with $61 billion in cuts through September, including riders to end financing for Planned Parenthood and the health care law. They had hoped to use the pressure of a potential shutdown to achieve much of their goal, but, so far, all they have accomplished is a cut of about $10 billion, mostly from earmarks or programs that the president himself proposed to cut. (The new bill cuts $6 billion.)
House Republican leaders, who say they do not want a government shutdown, have, so far, held off their more fanatical freshmen, who want to slash everything in sight. But the leadership cannot do so forever, and the evidence of that was clear on Tuesday. More than 50 Republicans refused to go along with the three-week resolution because it did not cut enough. Several specifically complained that it allowed financing for Planned Parenthood and the health care law to continue.
This is not a group that cares much for pragmatic compromise, and the three weeks are just a timeout. Representative Mike Pence of Indiana, a Republican who voted no on the new bill, spoke for many of his colleagues when he said the budget could not be resolved without a willingness to shut down government. “By giving liberals in the Senate another three weeks of negotiations,” he said, “we will only delay a confrontation that must come.”
He is absolutely right about that. If Democrats, including the president, do not draw a clear line soon, making their priorities and their limits unmistakable, they will be harried by these kinds of votes for years. Even in the unlikely case that an agreement is reached in three weeks to finance the government through September, a different vote will be necessary just a few weeks from now to raise the debt ceiling. Republicans have already vowed to vote that down — even though it could be financially disastrous — if they do not get their way. And then there is the vote for the fiscal 2012 budget, which begins Oct. 1, and then the year after that.
At some point, Mr. Pence will get his confrontation. If Republicans continue to press for cuts of tens of billions from discretionary spending, setting back the economic recovery largely for ideological purposes, Democrats will have to say no, even if that results in a short-term shutdown. The American people will be able to figure out who is at fault. Responsible governing means agreeing quickly to a deal to finish out the fiscal year, and then starting a serious talk about entitlement programs and taxes — the real causes of a soaring deficit.
By: The New York Times, Editorial, March 15, 2011
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