In This Fantasy Budget Deficit And Debt Fight, the Tea Party Refuses To Take ‘Yes’ For An Answer
Suppose I told you that I knew of a simple way to alleviate the budget deficit problem, and that it would require Congress not to do anything at all. You’d conclude that this was the poor start to a late April Fools’ column.
But unhappily the April Fools’ joke unfolding in the nation’s capital is the fantasy budget and spending debate itself. It’s rooted in an unreality that is about to crash into an unyielding real world, possibly in the form of a government shutdown.
The Congressional Budget Office, a nonpartisan fiscal scorekeeper, projects the budget deficit will be $1.5 trillion this year, or 9.8 percent of gross domestic product. In order to achieve budget stability and sustainability, according to economists, that figure should be around 3 percent of GDP. But here’s the good news: The CBO projects that the deficit will “drop markedly over the next few years as a share of output and average 3.1 percent of GDP from 2014 to 2021.” We’re saved! And it gets better: “Those projections . . . are based on the assumption that tax and spending policies unfold as specified in current law.”
In other words, all Congress has to do is what they seem ideally suited to these days—nothing. Ah, but there’s the rub. CBO continues that its projections “understate the budget deficits that would occur if many policies currently in place were continued, rather than allowed to expire as scheduled under current law.” Those policies include the Bush tax cuts. They also include annual spending punts that enjoy broad bipartisan support, like preventing the Alternative Minimum Tax’s bracket creep from snagging the middle class, and the “doc fix,” which pushes back a scheduled cut in Medicare payments.
So the solution isn’t so simple. But lawmakers wishing to do more than talk about dealing with the deficit could demand offsets for these policy changes. Instead, we’re reminded of the reality that even the toughest self-styled budget hawks–including Budget Committee Chairman Paul Ryan, who describes dealing with the deficit as a “moral imperative” but advocates extending the Bush tax cuts in full in perpetuity at a cost of nearly $4 trillion–are actually strutting budget peacocks more concerned with perception than results, or fiscal results anyway.
Take, for example, the Republican Study Committee, the hawkiest of the GOP budgetary birds of prey and enforcers of the party’s economic dogma. Going by reputation, they should be able to proffer a budget plan to bring the deficit into line. But the Concord Coalition, a group focused on eliminating the deficit, last month used CBO numbers to examine a scenario under which the Study Committee got its tax-and-spending wish list, which includes an extension of the Bush tax cuts, repeal of the Obama healthcare law (which CBO scores as a money-saver, meaning that repeal adds to the deficit), and $2.7 trillion saved in a spending freeze and cuts. The result? “Under this scenario, the resulting deficits would be $2.1 trillion larger over 10 years,” according to Concord, which concludes, “A budget that uses honest numbers and reflects Republicans’ current policy preferences will result in large continuing deficits.”
But nevertheless, and in the face of six recent years of GOP control over both the White House and Congress, Republicans have won the budget perception battle, and soundly. A poll released last week by Democracy Corps, a group of prominent liberal pollsters including Stan Greenberg and James Carville, found that independent voters are “still hesitant to trust Democrats on spending.”
Meanwhile the debate in Washington has focused almost entirely on spending cuts, even though polls show that voters are more concerned about jobs and the economy than the budget and the deficit—and even though most economists agree that the GOP’s proposed spending cuts would set back the recovery.
But the clearest example of the GOP having the Democrats on the run can be found in the current negotiations aimed at averting a government shutdown in a week. House Republican leaders originally wanted $32 billion in spending cuts for this year; that figure prompted a conservative backlash that ended with the House passing $61 billion in cuts. Now, according to press reports, negotiators have settled on $33 billion in cuts. In other words, the GOP, which controls one of three players in this negotiation, has already achieved its original budgetary goal. In this regard, House Speaker John Boehner seems to have (intentionally or not) used his Tea Party wing as a perfect foil to pull the debate to the right.
But judging by last Thursday’s Tea Party demonstration on the Hill—aimed at the GOP, mind you—conservatives don’t seem capable of banking their win and moving on to the next fight. They see anything less than total victory as an abject surrender.
And in that sense reality is about to intrude upon their budgetary-political fantasy land. The reality is that while voters like spending cuts in the abstract, polls show they object to the particulars of the GOP agenda. That reality is already taking hold at the state level where, Politico reported last week, the wave of newly elected governors trying to get tough on budgets have seen their approval ratings collapse.
And the experience of state governments also provides an insight into the possible winners and losers in a government shutdown. A pair of political scientists published a paper last year looking at the effects of such budgetary breakdowns (167 of them since 1988) at the state level, reports the Washington Post’s Ezra Klein. The study found that voters tend to punish legislators while rewarding the executive. So a shutdown would benefit President Obama while hurting lawmakers in both parties.
So if members of Congress let the government shut down on Friday, they will be the real April fools.
By: Robert Schlesinger, U.S. News and World Report, April 6, 2011
Implosion: Paul Ryan’s Radical, Ridiculous, Rip-Off Roadmap
While the process of crafting a budget plan for this fiscal year implodes under the weight of GOP intransigence, today also happens to be the day next year’s budget fight begins in earnest. And if you think the current fight is a mess, prepare to have Republicans take your breath away.
And if you’re a disabled senior on Medicaid, relying on an oxygen tank, that expression should probably be taken literally.
Today, House Budget Committee Chairman Paul Ryan (R-Wis.) unveils his plan for fiscal year 2012. He promised a truly radical approach to our entire system of government, and he wasn’t lying — Ryan’s budget is based on his radical “roadmap” and effectively rewrites the American social contract.
Medicare would be eliminated and replaced with a voucher system. Medicaid would be gutted and sent to the states as a block grant. The Affordable Care Act would be scrapped, tax rates on corporations and the wealthy would be slashed, and all told, Ryan’s plan intends to slash roughly $6 trillion from the federal budget over the next 10 years.
This is madness.
There’s obviously no way Democrats in the Senate or the White House will even consider such extremism, but House Republicans don’t much care. This is the plan they want; this is the plan they’ll pass; and this is the plan that will set a truly ridiculous benchmark for future negotiations. If a shutdown seems inevitable this week, wait until the House GOP votes to eliminate Medicare as part of their next budget pitch.
Those of us hoping the chattering class will recognize the Republican plan as extremist nonsense are likely to be disappointed. David Brooks gushed today about the radical roadmap.
The country lacked that leadership until today. Today, Paul Ryan, the Republican chairman of the House Budget Committee, is scheduled to release the most comprehensive and most courageous budget reform proposal any of us have seen in our lifetimes. Ryan is expected to leap into the vacuum left by the president’s passivity. The Ryan budget will not be enacted this year, but it will immediately reframe the domestic policy debate.
His proposal will set the standard of seriousness for anybody who wants to play in this discussion…. Paul Ryan has grasped reality with both hands. He’s forcing everybody else to do the same.
Jonathan Zasloff’s point-by-point takedown of the Brooks column is worthwhile, but my biggest fear is that the D.C. establishment will start to assume that Brooks is correct. He’s not. Ryan’s budget plan is stark raving mad.
“Courageous”? To the extent that a major political party and House majority is actually willing to rally behind such extremism — without a hint of shame or trepidation — I’ll gladly give Republicans credit for actually putting their ridiculous wish list on the table.
But in this context, real, meaningful courage requires sound judgment, not just a willingness to fight for millionaires and corporations, while screwing over the elderly, the poor, the disabled, and working families.
By: Steve Benen, Washington Monthly, April5, 2011
Cutting Medicaid Means Cutting Care For The Poor, Sick And Elderly
The part of Paul Ryan’s budget that’s going to get the most attention is his proposal to privatize and voucherize Medicare. But the part that worries me the most is his effort to slash Medicaid, with no real theory as to how to make up the cuts.
Ryan’s op-ed introducing his budget lists Medicaid under “welfare reform,” reflecting the widespread belief that Medicaid is a program for the poor. That belief is wrong, or at least incomplete. A full two-thirds of Medicaid’s spending goes to seniors and people with disabilities — even though seniors and the disabled are only a quarter of Medicaid’s members. Sharply cutting Medicaid means sharply cutting their benefits, as that’s where the bulk of Medicaid’s money goes. This is not just about the free health care given to some hypothetical class of undeserving and unemployed Medicaid queens.
But perhaps cutting it wouldn’t be so bad if there were a lot of waste in Medicaid. But there isn’t. Medicaid is cheap. Arguably too cheap. Its reimbursements are so low many doctors won’t accept Medicaid patients. Its costs grew less quickly than those of private insurance over the past decade, and at this point, a Medicaid plan is about 20 percent cheaper than an equivalent private-insurance plan. As it happens, I don’t think Medicaid is a great program, and I’d be perfectly happy to see it moved onto the exchanges once health-care reform is up and running. But the reason that’s unlikely to happen isn’t ideology. It’s money. Giving Medicaid members private insurance would cost many billions of dollars.
That’s why it’s well understood that converting Medicaid into block grants means cutting people off from using it, or limiting what they can use it for. You can see CBO director Doug Elmendorf say exactly the same thing here. There’s just not another way to cut costs in the program. You can, of course, work to cut costs outside of the program, either by helping people avoid becoming disabled or making it cheaper to treat patients once they become disabled or sick, but those sorts of health-system reforms are beyond the ambitions of Ryan’s budget.
To get around some of this, Ryan’s op-ed talks about state flexibility, with the implication being that states have some secret Medicaid policies they’ve been dying to try but that the federal government simply hasn’t let them attempt. But the truth is there’s been a tremendous amount of experimentation in Medicaid over recent decades. Indiana converted its Medicaid program into health savings accounts. Tennessee based its program around managed care. Massachusetts folded its Medicaid money into Mitt Romney’s health-care reforms. Oregon tried to rank treatments by value. Some of these reforms have worked well and some haven’t worked at all, but none have solved the basic problem that covering the sick and disabled costs money, and you can’t get around that by trying to redesign their insurance packages. For that reason, block-granting Medicaid ultimately means cutting health-care coverage to the poor, the elderly and the disabled, even as it doesn’t actually address the factors driving costs throughout the health-care system.
By: Ezra Klein, The Washington Post, April 5, 2011
Government Shutdown: A Hostile Act Against A Civil Society By A “Band Of Rebels”
Shutting down the federal government is a hostile act against civil society.
The Civil War started 150 years ago in April 1861, and we are still getting over it, still talking about it, still writing about it. Some in the South have still not made peace with the end of the Civil War and hold fast to “heroes,” notably General Robert E. Lee. President Abraham Lincoln showed what he thought of Lee when he seized Arlington, Lee’s stately home and slave plantation across the Potomac River, and started burying the dead Union soldiers in the ground there.
Lincoln’s message could not be clearer: Leading an assault on the Union was not a Sunday picnic in the country. Serious consequences followed, hitting home.
Now we have a band of rebels—87 of them newcomers—in the House Republican majority, who are fixin’ for a fight. Spoiling to see the Capitol Dome go dark. Acting as if that’s the mission, the reason they crossed lines to come into the heart of the enemy. Washington is a staging ground for their defiant anger at the Union. The republic is under a new kind of siege.
If they have their way, the federal government will be closed this time next week, not what we need right now with so many American households hanging by a thread.
Now a few facts to concentrate the mind. First, the Tea Party is part of the problem. But hold the whole lot of House Republicans and their leaders responsible. If there are any grown-ups in the House, they are allowing their most radical element, unschooled freshmen, to dominate in a delicate showdown looming with the Senate and the White House.
Second, remember the Senate is controlled by a Democratic majority, a fact conveniently forgotten by the lower chamber, whose members often brag about the last election. The 2010 outcome was actually an evenly divided government, with a Democratic president to play his part in final outcomes, laws, and budgets. That’s the way it should be, if Senate Democrats and President Obama will only stand up to the rebels.
Third, the scope of the House Republican “defunding” demands is tantamount to waging war on our civil society as we know it. I don’t mean just NPR. Some of the priceless “commons” are at risk, in the proposed degradation of environmental programs. Social programs like family planning and women’s health are on the chopping block in an offensive against women’s health and reproductive rights. Chris Van Hollen, a House Democrat from Maryland, reads it right: Across the aisle is an extreme agenda to impose a right-wing ideology on town and country, using budget cuts as a vehicle.
Fourth and finally, whether $33 billion or $60 billion is cut from the budget, it will be too much. For the collective health of the nation, either number is like going on a diet when you’re starving. It’s really no use the two congressional chambers meeting in the middle, because the rebels can say they won the day—and they might be “right” in more ways than one. They skewed the debate by passing their draconian budget early and talking it up every day since.
What the GOP House freshmen lack in knowledge, they make up with sophomoric enthusiasm. They are so gung ho to camp out in the dark. Remembering Lincoln, don’t let the rebels take over and turn the lights out on us.
By: Jamie Stiehm, U.S. News and World Report, April 4, 2011
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