“Unintentionally Revealing”: Paul Ryan’s Path To Nowhere
“Why don’t you balance the budget at 24 percent [of GDP] instead of 19 percent?” I asked.
“I think it would do damage to the economy,” Rep. Paul Ryan replied.
This simple exchange from a conversation I had with Ryan in his office last October captures the uber-debate the country needs to have. That is, once we get done dissecting the deceptions, hypocrisies and regressive priorities in the Wisconsin Republican’s latest blueprint.
For starters, Ryan’s assumption that higher levels of spending and taxation would automatically hurt the economy can’t be right. If it were, America would be a poorer country today than it was a hundred years ago, when the federal government taxed and spent less than 5 percent of gross domestic product. But we’re obviously vastly wealthier. That doesn’t mean there isn’t a limit beyond which higher taxes and spending would hurt. Just that we’re not close to that point. How can we be, when President Reagan ran government at 22 percent of GDP?
Federal spending has gone from recent norms of about 20 percent of GDP to 24 percent under President Obama, thanks to the lagging economy and spending on things like the stimulus and unemployment insurance. Ryan wants to get it back to 20 percent in the next few years and return taxes to their more recent norms of 19 percent, up from today’s recession-depleted 15 percent. (The nonpartisan Tax Policy Center said Tuesday that Ryan’s proposals would in fact fall dramatically short of 19 percent, but leave that aside for the moment.)
At first blush, Ryan’s plan sounds perfectly reasonable — until you remember that we’re about to retire 76 million baby boomers.
“I think the historic size [of government as a share of GDP] is about right, or smaller,” Ryan told me that day.
“But how can that be,” I asked, “when we’re doubling the number of seniors” on Social Security and Medicare, the biggest federal programs.
“Because we can’t keep doing everything for everybody in this country,” he said. “We should trim down a lot of other stuff we’re doing.”
This was unintentionally revealing. Ryan has sounded this theme before. “We are at a moment,” Ryan said in his State of the Union response in 2011, “where if government’s growth is left unchecked and unchallenged . . . we will transform our social safety net into a hammock, which lulls able-bodied people into lives of complacency and dependency.”
But what hammock is Ryan talking about? The only thing slated to grow the size of government in the years ahead is the retirement of the baby boomers. The doubling of the number of people eligible for Social Security and Medicare is what is driving all the increase in federal spending — along with the spiral in system-wide health costs, which afflicts Medicare along with all privately financed health care.
If those programs for seniors haven’t been a “hammock” until now, simply doubling the number of people eligible for them can’t turn them into a “hammock” tomorrow. When it comes to fiscal policy, we have an aging population challenge, and a health-cost challenge. We don’t have a “hammock” challenge.
The upshot? Ryan wants to use an aging America and the bogus but superficially appealing constraint of “historic levels of spending and taxation” to force massive reductions in the rest of government. That’s why the Center on Budget and Policy Priorities and others Tuesday were already calculating that Ryan’s new plan would basically zero out everything in government a few decades from now, save for Social Security, Medicare and defense.
The crucial thing to understand about Ryan is that he is not a fiscal conservative. He’s a small-government conservative. These are very different things. The fastest-growing federal program in Ryan’s new budget is interest on the debt, which nearly triples from $234 billion next year to $614 billion in 2022. He doesn’t even pretend to balance the budget until 2040, and then only under utterly dubious assumptions.
These are not the choices a fiscal conservative makes. A fiscal conservative pays for the government he wants. Ryan wants government smaller than the one Reagan led even as America ages, and he doesn’t want to pay for it. Instead he adds trillions in new debt and makes no bones about it.
“Why would you choose to have debt, as opposed to saying we’re going to pay our own way now” via higher taxes, I asked Ryan back in October. This even after spending cuts that most Republicans think won’t command public support. “Why is that a conservative value?”
“Because of growth,” he said. “What I don’t want to do is sacrifice an entire generation to having less than optimal potential growth because their parents didn’t fix this problem.”
Huh? A cynic would say Ryan would do anything to avoid acknowledging the need for higher taxes as the boomers age. The conservative darling just won’t go there. The less charitable assumption is that the congressman is confused.
There’s more to say on Ryan’s blueprint, and, in spite of my general hostility to his thinking, he deserves credit for putting his party’s head in the noose by calling (rightly, if imperfectly) for Medicare reform. But the first order of business is to expose Ryan’s overall plan for the misguided, misleading and unacceptable vision it represents.
By: Matt Miller, Opinion Writer, The Washington Post, March 21, 2012
“This Really Isn’t Complicated”: Mitt Romney Should Read Paul Ryan’s Budget Plan
Mitt Romney’s allergy to honesty has come into sharper focus this week, but even by his standards, the comments Romney made on a Wisconsin radio show this morning were astounding.
Romney said the plan introduced by House Budget Committee chairman Ryan (R-Janesville) “does not balance the budget on the backs of the poor and the elderly … It instead preserves Medicare and preserves Social Security.”
Look, this really isn’t complicated. Paul Ryan’s budget plan is simply brutal towards the poor and working families. Romney doesn’t have to like it, but he really shouldn’t lie about it.
Center on Budget and Policy Priorities
House Budget Committee Chairman Paul Ryan’s budget plan would get at least 62 percent of its $5.3 trillion in nondefense budget cuts over ten years (relative to a continuation of current policies) from programs that serve people of limited means. This stands a core principle of President Obama’s fiscal commission on its head and violates basic principles of fairness.
While giving a massive tax break to the wealthy, the Ryan budget plan Romney is so fond of slashes funding for Medicaid, food stamps, and other for low-income programs, nearly all of which Ryan’s plan would eliminate over the next couple of decades.
As the CBPP’s Robert Greenstein put it, “[T]he Ryan budget would impose extraordinary cuts in programs that serve as a lifeline for our nation’s poorest and most vulnerable citizens, and over time would cause tens of millions of Americans to lose their health insurance or become underinsured.” He added that Ryan’s plan “would cast tens of millions of less fortunate Americans into the ranks of the uninsured, take food from poor children, make it harder for low-income students to get a college degree, and squeeze funding for research, education, and infrastructure.”
If this doesn’t “balance the budget on the backs of the poor,” for crying out loud, what exactly would such a budget plan look like?
As for “preserving” Medicare, the Ryan plan that Romney supports would turn Medicare into a voucher program, scrapping the guaranteed benefit altogether; weaken Medicare solvency; and bring back the Medicare Part D prescription drug “donut-hole.”
So, what are we to make of Romney’s comments this morning? He’s either lying or he hasn’t read the budget plan he’s endorsed. It’s one or the other.
By: Steve Benen, The Maddow Blog, March 23, 2012
“The Collapse Of Civilization”: GOP Releases Plan To Save America From The Poor
The House Republicans unveiled their new budget today, complete with a spooky video pressing home the point that only the House Republicans and their leader Paul Ryan stand between us and CIVILIZATIONAL COLLAPSE. Yes, the peril of rising debt is that bad. No, it’s not so bad that it’s worth restoring Clinton-era tax rates to prevent. But so bad that it’s worth throwing tens of millions of people off health insurance? Oh, yeah.
The first place to begin with the House budget is taxes. The plan is to slash tax rates, with the top rate dropping to 25 percent. The budget asserts that it will make up for most of the lost revenue by eliminating tax deductions, but it does not say which ones. This would require them to produce about $6 trillion worth of tax deductions. It would also ensure that, if they succeeded, taxes on the rich would fall, a lot, and taxes on many non-rich people would rise. This probably explains why they are not providing any details, which also explains why this promise would be tricky to fulfill. In any case, the upshot is that they have delineated $6 trillion worth of deficit-expansion, offset by unspecified promises to make it up.
On the spending side, things get somewhat more specific. Medicare would be partially privatized. The basic functions of government, like:
Over the next decade, Ryan would spend 30 percent less than the White House on “income security” programs for the poor — that’s everything from food stamps to housing assistance to the earned-income tax credit. (Ryan’s budget would spend $4.8 trillion over this timeframe; the White House’s would spend $6.8 trillion.) Compared with Obama, Ryan would spend 38 percent less on transportation and 24 percent less on veterans. He’d cut “General science, space, and basic technology” by 20 percent. And, compared with the White House, he’d slash “Education, training, employment, and social services” by a full 44 percent.
Do House Republicans really think the federal government is vastly overinvesting in things like roads and scientific research, or is this merely a gimmick to make their tax cuts appear affordable? It is hard to say.
They do genuinely seem to believe that the federal government spends way too much on the poor and sick, and move to correct that. Poor people, or people who have a family member with a serious medical condition, come in for special abuse here. The Republican budget would repeal the Affordable Care Act, which provides health insurance coverage to 30 million people, and replace it with nothing. On top of that, it would absolutely slash Medicaid and the childrens’ health insurance plan, eliminating coverage from 14-27 million more people (the wide variation reflects the fact that the outcome heavily depends on how states respond to the huge cuts, and the elimination of rules that force states to cover poor people.)
All in all, we have a standard mix of specific benefits for the rich, specific pain for the poor, and a lot of vague promises that would entail pain for the middle class, without committing themselves in a way that could hurt politically.
By: Jonathan Chait, Daily Intel, March 20, 2012
“Groundhog Day”: The 5 Worst Things About The House GOP’s Budget
After his last attempt at a budget went down in flames last year, House Budget Committee Chairman Paul Ryan (R-WI) unveiled the House GOP’s new budget this morning, painting it as a sensible plan to reform the nation’s tax code and reduce the debt while maintaining entitlement programs like Social Security, Medicare, and Medicaid. Yet again, however, Ryan and the GOP have the social safety net and Medicare in their sights, and yet again, they’re attempting to pass the cost of massive tax breaks for corporations and the rich off to middle and lower-income Americans.
Here are the five worst things about Ryan’s budget:
1. SENIORS WOULD PAY MORE FOR HEALTH CARE: Beginning 2023, the guaranteed Medicare benefit would be transformed into a government-financed “premium support” system. Seniors currently under the age of 55 could use their government contribution to purchase insurance from an exchange of private plans or traditional fee-for-service Medicare. But the budget does not take sufficient precautions to prevent insurers from cherry-picking the the healthiest beneficiaries from traditional Medicare and leaving sicker applicants to the government. As a result, traditional Medicare costs could skyrocket, forcing even more seniors out of the government program. The budget also adopts a per capita cost cap of GDP growth plus 0.5 percent, without specifying how it would enforce it. This makes it likely that the cap would limit the government contribution provided to beneficiaries and since the proposed growth rate is much slower than the projected growth in health care costs, CBO estimates that new beneficiaries could pay up to $1,200 more by 2030 and more than $5,900 more by 2050. Finally, the budget would also raise Medicare’s age of eligibility to 67. Some seniors who would no longer be eligible for Medicare would pick up employer coverage—but they would pay more in premiums and cost sharing. And since the budget would scale back or eliminate other coverage options, hundreds of thousands of seniors would become uninsured.
2. ELDERLY AND DISABLED WOULD LOSE MEDICAID COVERAGE: The budget would eliminate the exiting matching-grant financing structure of Medicaid and would instead give each state a pre-determined block grant that does not keep up with actual health care spending. This would shift some of the burden of Medicaid’s growing costs to the states, forcing them to — in the words of the CBO — make cutbacks that “involve reduced eligibility for Medicaid and CHIP, coverage of fewer services, lower payments to providers, or increased cost sharing by beneficiaries—all of which would reduce access to care.” The block grants would reduce federal Medicaid spending by $810 billion over 10 years, decreasing federal Medicaid spending by more than 35 percent over the decade. As a result, states could reduce enrollment by more than 14 million people, or almost 20 percent—even if they are were able to slow the growth in health care costs substantially.
3. THIRTY MILLION AMERICANS WOULD LOSE HEALTH COVERAGE: The budget repeals the Affordable Care Act’s requirement to purchase health insurance coverage, the establishment of health insurance exchanges and the provision of subsidies for lower-income Americans, the expansion of the Medicaid program, tax credits for small businesses that provide insurance coverage. As a result, more than 30 million Americans would lose coverage and the budget would eliminate the new law’s consumer protections, which have already benefited tens of millions of Americans.
4. CORPORATIONS AND THE RICH WOULD GET A $3 TRILLION TAX CUT: By repealing the Alternative Minimum Tax and the investment taxes in the Affordable Care Act and lowering the top income tax rate to 25 percent, the Ryan budget provides the wealthiest Americans with $2 trillion in tax breaks. By lowering the top corporate tax rate and allowing corporations to return profits made overseas to the United States at no cost, he gives corporations more than $1 trillion in tax breaks. Ryan insists his plan will be revenue neutral — he just won’t say how. The CBO’s scoring of the plan, meanwhile, is based on Ryan’s own assertions that the plan would maintain or increase revenue.
5. DEFENSE BUDGET WOULD GET A BOOST, WHILE THE SAFETY NET IS CUT: The Ryan budget protects defense spending from automatic cuts agreed to in last year’s debt deal, then boosts defense spending to $554 billion in 2013 — $8 billion more than agreed upon in the deal. At the same time, it asks six Congressional committees to find $261 billion in cuts. That includes $33.2 billion from the Agriculture Committee, meaning food stamps and other social safety net programs are likely to face cuts, all while the Pentagon remains untouched.
By: Igor Volsky and Travis Waldron, Think Progress, March 20, 2012
Hurray For Health Reform: “Protecting Those Who Are Falling Through The Cracks”
It’s said that you can judge a man by the quality of his enemies. If the same principle applies to legislation, the Affordable Care Act — which was signed into law two years ago, but for the most part has yet to take effect — sits in a place of high honor.
Now, the act — known to its foes as Obamacare, and to the cognoscenti as ObamaRomneycare — isn’t easy to love, since it’s very much a compromise, dictated by the perceived political need to change existing coverage and challenge entrenched interests as little as possible. But the perfect is the enemy of the good; for all its imperfections, this reform would do an enormous amount of good. And one indicator of just how good it is comes from the apparent inability of its opponents to make an honest case against it.
To understand the lies, you first have to understand the truth. How would ObamaRomneycare change American health care?
For most people the answer is, not at all. In particular, those receiving good health benefits from employers would keep them. The act is aimed, instead, at Americans who fall through the cracks, either going without coverage or relying on the miserably malfunctioning individual, “non-group” insurance market.
The fact is that individual health insurance, as currently constituted, just doesn’t work. If insurers are left free to deny coverage at will — as they are in, say, California — they offer cheap policies to the young and healthy (and try to yank coverage if you get sick) but refuse to cover anyone likely to need expensive care. Yet simply requiring that insurers cover people with pre-existing conditions, as in New York, doesn’t work either: premiums are sky-high because only the sick buy insurance.
The solution — originally proposed, believe it or not, by analysts at the ultra-right-wing Heritage Foundation — is a three-legged stool of regulation and subsidies. As in New York, insurers are required to cover everyone; in return, everyone is required to buy insurance, so that healthy as well as sick people are in the risk pool. Finally, subsidies make those mandated insurance purchases affordable for lower-income families.
Can such a system work? It’s already working! Massachusetts enacted a very similar reform six years ago — yes, while Mitt Romney was governor. Jonathan Gruber of the Massachusetts Institute of Technology, who played a key role in developing both the local and the national reforms (and has published an illustrated guide to reform) has surveyed the results — and finds that Romneycare is working pretty much as advertised. The number of people without insurance has dropped sharply, the quality of care hasn’t suffered, and the program’s cost has been very close to initial projections.
Oh, and the budgetary cost per newly insured resident of Massachusetts was actually lower than the projected cost per American insured by the Affordable Care Act.
Given this evidence, what’s a virulent opponent of reform to do? The answer is, make stuff up.
We all know how the act’s proposal that Medicare evaluate medical procedures for effectiveness became, in the fevered imagination of the right, an evil plan to create death panels. And rest assured, this lie will be back in force once the general election campaign is in full swing.
For now, however, most of the disinformation involves claims about costs. Each new report from the Congressional Budget Office is touted as proof that the true cost of Obamacare is exploding, even when — as was the case with the latest report — the document says on its very first page that projected costs have actually fallen slightly. Nor are we talking about random pundits making these false claims. We are, instead, talking about people like the chairman of the House Republican Policy Committee, who issued a completely fraudulent press release after the latest budget office report.
Because the truth does not, sad to say, always prevail, there is a real chance that these lies will succeed in killing health reform before it really gets started. And that would be an immense tragedy for America, because this health reform is coming just in time.
As I said, the reform is mainly aimed at Americans who fall through the cracks in our current system — an important goal in its own right. But what makes reform truly urgent is the fact that the cracks are rapidly getting wider, because fewer and fewer jobs come with health benefits; employment-based coverage actually declined even during the “Bush boom” of 2003 to 2007, and has plunged since.
What this means is that the Affordable Care Act is the only thing protecting us from an imminent surge in the number of Americans who can’t afford essential care. So this reform had better survive — because if it doesn’t, many Americans who need health care won’t.
By: Paul Krugman, Op-Ed Columnist, The New York Times, March 18, 2012
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