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“Entitlements For Me And Mine”: The GOP Wants To Cut The Social Safety Net — But Only For Young And Poor People

Newly minted 2016 presidential candidate Mike Huckabee is selling himself to older Republicans as the guy who will keep Washington’s grasping hands off their government-provided Medicare and Social Security. In his recent announcement speech, the former Fox News host and ex-governor of Arkansas attacked rivals who “propose that to save the safety nets like Medicare and Social Security, we ought to chop off the payments for the people who have faithfully had their paychecks and pockets picked by the politicians.” For that and similar statements, Huckabee’s candidacy is being portrayed as some radical departure from GOP economic orthodoxy and, as The New York Times put it, is supposedly “exposing growing fault lines in the party over an issue that has long been considered a political third rail.”

Not so much, actually. Huckabee’s do-(almost)-nothing stance on entitlement reform reflects the GOP consensus. He’s just more explicit about it than most. It’s really only potential 2016er Chris Christie — with his call for cutting retirement pay for wealthier seniors — who seems to be the odd man out.

There was a time, of course, when Republicans were pushing hard to fix the fiscal problems of Medicare and Social Security. Rep. Paul Ryan’s 2010 “Roadmap for America’s Future” probably marked Peak Reform. That budget blueprint called for allowing pre-retirement workers to divert part of their payroll taxes into private retirement accounts and to receive vouchers to buy private health insurance when they finally called it quits. Such sweeping changes were needed, Ryan and other Republicans argued, to prevent these programs from “bankrupting” America.

But by the 2012 presidential election, Republicans were backtracking from those big ideas. In his convention speech, GOP presidential nominee Mitt Romney attacked President Obama for wanting to cut future Medicare spending. Vice presidential nominee Paul Ryan explained how important Medicare was for his grandmother with Alzheimer’s. Social Security wasn’t mentioned by name at all. Likewise, the Ryan budgets stopped calling for specific Social Security reforms.

Things went even further in the 2014 midterms, when GOP groups ran ads against some Democratic candidates accusing them of wanting to cut Social Security benefits and raise the retirement age. And today, the new Republican House-Senate budget drops the “premium support” Medicare reform that had been a staple of the Ryan budgets, although it does include some $400 billion in unspecified, 10-year Medicare savings also requested by Obama.

So what happened? The long-term federal financial picture hasn’t miraculously turned around since 2010. The Congressional Budget Office projects that federal spending on Medicare and Social Security over the next 25 years will rise by roughly three percentage points of GDP, from 8 percent to 11 percent. The debt deluge that prompted calls for radical reform is still on its way. What has changed is that Republicans are wising up to just how much they depend on older voters. Those 65 and over gave 56 percent of their votes to Romney in 2012 and were critical to congressional victories in 2010 and 2012.

Another big change since 2010: ObamaCare. The passage of the the president’s Affordable Care Act — opposed by older, tea party Republicans — has affected how GOP politicians view and talk about the safety net. They now clearly differentiate between “earned” entitlement benefits such as Medicare and Social Security and “unearned” welfare benefits such as ObamaCare subsidies, Medicaid, and food stamps. As Wall Street Journal columnist Holman Jenkins accurately predicted back in 2013, “The new ‘conservative’ position will be to defend Social Security and Medicare, those middle-class rewards for a life of hard work and tax-paying, against Mr. Obama’s vast expansion of the means-tested welfare state for working-age Americans.” Republican voters get the “good” entitlements, Democratic voters the “bad,” dependency-creating ones.

Huckabee clearly intends seniors to be the rock upon which he builds his candidacy. In the “Seniors” section of his campaign website, he promises to fight for the “earned benefits” of Social Security and Medicare — perhaps forgetting that a typical middle-class, one-earner couple retiring in 2030 will receive $1.3 million in lifetime Medicare and Social Security benefits, having paid in just under $500,000. Huckabee then attacks ObamaCare as a welfare program that diverts $700 billion from Medicare and fosters “government dependency.” Entitlements for me and mine but not for thee and thine.

The politics of this strategy are debatable. (Though it surely doesn’t help attract younger voters!) But regardless, it makes for simply awful public policy. Future safety net spending increases on older Americans need to be reduced. Republicans should continue the earlier work of Ryan in building the case for those changes. Moreover, more of what is spent will need to shift to lower-income Americans. At the same time, some kinds of safety net spending for the poor will need to be increased, such as the Earned Income Tax Credit. And turning Medicaid into a program that uses tax credits to buy private insurance, as some on the right want to do, would also likely cost more money.

If today’s GOP-leaning seniors want their grandkids to grow up in an America that can better take care of the truly needy — young and old — and pay its bills, they’ll reject Huckabee’s selfish populism.

 

By: James Pethokoulis, The Week, May 8, 2015

May 11, 2015 Posted by | GOP, Mike Huckabee, Social Safety Net | , , , , , , , , | Leave a comment

“Jeb Bush Pushes To ‘Phase Out’ Medicare”: Slow Learner’s? Ignorance? There’s Just ‘Something’ About Republican Politicians

Republican presidential hopeful Jeb Bush appeared at a New Hampshire event last night sponsored by the Koch brothers’ Americans for Prosperity, and the former governor raised a few eyebrows with his comments on the future of Medicare.

“The left needs to join the conversation, but they haven’t. I mean, when [Rep. Paul Ryan] came up with, one of his proposals as it relates to Medicare, the first thing I saw was a TV ad of a guy that looked just like Paul Ryan … that was pushing an elderly person off the cliff in a wheelchair. That’s their response.

“And I think we need to be vigilant about this and persuade people that our, when your volunteers go door to door, and they talk to people, people understand this. They know, and I think a lot of people recognize that we need to make sure we fulfill the commitment to people that have already received the benefits, that are receiving the benefits. But that we need to figure out a way to phase out this program for others and move to a new system that allows them to have something – because they’re not going to have anything.”

Remember, Jeb Bush is the ostensible moderate candidate in the massive GOP presidential field. It says something important about Republican politics in 2015 when the most mainstream candidate is also the candidate who wants to scrap Medicare altogether.

Regardless, there’s quite a bit wrong with his take on the issue, both as a matter of politics and policy. Let’s start with the former.

The Florida Republican is convinced that “people understand” the need to get rid of Medicare. He’s mistaken. Given the polling from the last several years, what people understand is that Medicare is a popular and successful program, and a pillar of modern American life.

Previous attempts to “phase out” the program have met with widespread public scorn and if Jeb Bush believes he can “persuade people” to get rid of Medicare, he’s likely to be disappointed.

As for the policy, there’s no point in denying that the Medicare system faces long-term fiscal challenges, but to argue, as Jeb Bush does, that Democrats have ignored the conversation is plainly incorrect. On the contrary, while Republicans fight to eliminate the Medicare program, Democrats have had great success in strengthening Medicare finances and extending its fiscal health for many years to come.

The secret, apparently, was passing the Affordable Care Act.

Before “Obamacare” was passed, Medicare was projected to face a serious fiscal shortfall in 2017. As of yesterday, Medicare trustees now believe the system is fiscally secure through 2030.

Kevin Drum noted the slowdown in costs, which is “spectacularly good news.”

Ten years ago, Medicare was a runaway freight train. Spending was projected to increase indefinitely, rising to 13 percent of GDP by 2080. This year, spending is projected to slow down around 2040, and reaches only 6 percent of GDP by 2090.

Six percent! That’s half what we thought a mere decade ago. If that isn’t spectacular, I don’t know what is.

Obviously, all of these projections come with caveats because no one can say with certainty what will happen in the future, but the projections are encouraging – and far more heartening than they were before the ACA passed.

But Jeb Bush is under the impression that Medicare is, without a doubt, doomed, so we might as well get rid of the program now and see what Paul Ryan has in store for seniors in his far-right bag of tricks.

There’s a better way. Medicare’s future is looking brighter, it’s as popular as ever, and its fiscal challenges can be addressed without tearing down the entire system. It’s a matter of political will – either elected policymakers will fight to protect Medicare or they’ll push to eliminate it.

 

By: Steve Benen, The Maddow Blog, July 21, 2015

March 24, 2015 Posted by | Conservatives, GOP Presidential Candidates, Jeb Bush, Medicare | , , , , | Leave a comment

“Don’t Let The GOP Buy Your Vote, Stupid”: The GOP Has Zero Credibility When It Comes To Fiscal Responsibility

If you want to understand exactly how the Republicans plan to buy the votes needed to win the 2016 presidential election, look no further than “The Economic Growth and Family Fairness Tax Plan.”

Heard of it? The plan, which is being touted with Willy Loman-esque desperation by Sens. Marco Rubio and Mike Lee, seeks to fix our “antiquated and dysfunctional…federal tax system.” And it’s won slow clap after slow clap from Republican-friendly conservatives at Americans for Tax Reform, National Review, and The American Enterprise Institute, whose James Pethokoukis raves, “Lee and Rubio might have cooked up the first great tax cut plan of the 2000s.”

Yeah, not so much. Despite some good features that would likely spur economic growth—such as reducing corporate tax rates by 10 percentage points, switching to a territorial collection system, and capping business-income rates filed on individual Schedule C forms—what the plan does is return us to the early years of the George W. Bush presidency, when budget continence was never allowed to get in the way of shoveling cash to targeted voters.

Recall, for instance, how Bush and a Republican Congress pushed through an unfunded (and unnecessary) Medicare prescription drug plan back in 2003 as a straight-up gift to seniors, who had voted Democratic in 2000. Mission accomplished: Bush went from getting just 47 percent of the senior vote against Al Gore in 2000 to pulling 52 percent of the 65-plus crowd against John Kerry in 2004.

At least Bush was pissing away theoretical budget surpluses that were falsely projected to last far into the future. After years of record-setting deficits and mounting national debt, today’s politicians certainly don’t have that excuse. Yet last year’s Republican budget resolution called for net spending increases every year for the next 10 years, starting at $3.7 trillion and culminating in projected spending of $5 trillion in 2024 (in current dollars). And given the whopping increases in real per-capita spending under a Republican president and Congress during Bush’s first term in office, the GOP has zero credibility when it comes to fiscal responsibility.

There’s no doubt that a spending hawk such as Lee, who has proposed a balanced-budget amendment in the past, knows that. Yet at the heart of his and Marco Rubio’s plan is a massive giveaway to parents in the form of a new $2,500 child tax credit (this would be added to an already existing $1,000 child credit) with no phase-out due to income.  However, because it’s “limited to the sum of total income and payroll tax liabilities, including employer-side payroll tax liability,” it means that low-income parents won’t be able to claim the full amount.

The expanded child credit is a big reason why, as AEI’s Pethokoukis grants, the plan would “lose something like $4 trillion in federal tax revenue over a decade, maybe half that if you apply ‘dynamic scoring’ that factors in the effects of economic growth.” (Dynamic scoring attempts to model changes in people’s behavior to changes in the tax code. While the method is easily abused, its core insight—that we change our consumption patterns when costs and benefits vary—is sound.)

But unlike cutting taxes on business activity or trimming top marginal tax rates, expanding the child tax credit has nothing to do with spurring economic growth. This is something that conservatives grant in most contexts. As Curtis S. Dubay of the Heritage Foundation wrote just last year, “Increasing the credit would be a targeted tax cut that would put more money in the pockets of people who qualify for the expansion. However, it would not improve economic growth like rate reductions would because a [child tax credit] increase would not reduce those disincentives on productive activities.”

The free-market Tax Foundation agrees. In fact, in an analysis of the Rubio-Lee plan, it ran both static and dynamic scores of the plan. On its static score for the next 10 years, the Tax Foundation found the Rubio-Lee plan meant serious reductions in annual federal revenue. For instance, switching to just two tax brackets of 15 percent and 35 percent would mean $31 billion less each year compared to current law. The full expensing of business equipment would lead to another annual loss of $78 billion, while the changes to the business taxes would cut $210 billion. And the expanded child tax credit would mean the feds would forgo another $173 billion.

Yet in its dynamic score of the same provisions, something different happens. The consolidation of tax brackets yields an average annual net gain of $5 billion, full expensing yields of $115 billion, and the changes in business taxes pulls in a net of $210 billion a year. But the expanded child tax credit? It still shows an average annual loss of $173 billion.

So the expanded child tax credit has nothing to do with promoting growth. Indeed, as my frequent co-author Veronique de Rugy points out at National Review, the generally accepted best way to promote economic growth via tax policy is by cutting high marginal rates. But because of the size and scope of Rubio and Lee’s expanded child tax credit they can’t reduce the top individual rate below 35 percent without punching an even bigger hole in revenue. “If bolstering the economic status of families is the point of all this,” she writes, “the way to go is lower tax rates, not a tax credit.”

In their explanation of the plan, Rubio and Lee claim that the expanded child tax credit is simply a way of abolishing what they call “the Parent Tax Penalty.” I’m sure I’m not the only one who has trouble following the logic here: “As parents simultaneously pay payroll taxes while also paying to raise the next generation that will pay payroll taxes, parents pay more into the old-age entitlement systems.” Huh? Parents pay to raise their children, yes. When those kids enter the workforce, they (not their parents) will pay taxes on their wages. Forget those “It’s a child, not a choice” bumper stickers. Kids today apparently are to be most valued for their ability to pay into unsustainable old-age retirement plans that need to be scrapped, not propped up.

Questions abound: If the amount of income subject to Social Security taxes is capped, doesn’t it also make sense then to phase out the credit above certain income levels? What about all the tax dollars that flow to children (and their parents) during their first 18 to 21 years? And if the expanded child tax credit is supposed to credit parents for future tax payments made by their children (yes, getting complicated), then why are low-income parents’ credits “limited to the sum of total income and payroll tax liabilities”? Aren’t we crediting parents for their kids’ future tax payments?

I’d argue instead that the “family fairness” portion actually has very little to do with the future past the 2016 election. Expanding the child tax credit, especially in a way that keeps the full amount for middle- and upper-class parents while limiting the amount low-income parents can get, is a pretty obvious (and obnoxious) way to buy votes among likely Republican voters. Especially when we all know that the GOP has no intention of trimming $173 billion out of federal spending to pay for it.

We’re long past the time for a serious conversation about how much government we want to buy and at what price. If the Obama years are any indication, the Democrats are genuinely uninterested in having that conversation. (The president’s latest budget proposal would increase spending over the next decade by more than 50 percent and end the period with bigger annual deficits than we have today.) But the Republicans, who are supposed to know better and be better on fiscal issues, are part of the problem too.

Every bit as much as the tax-and-spend Dems they love to attack, the Party of Reagan ushered in “the Golden Age of Government by Groupon.”

The only question that remains is how much our kids and grandkids will hate us for how much debt—I mean “family fairness”—we’ve amassed in their name.

 

By: Nick Gillespie, The Daily Beast, March 13, 2015

March 14, 2015 Posted by | Fiscal Policy, GOP, Tax Reform | , , , , , , , , , | Leave a comment

“This Election’s Biggest Jokes”: ‘Republicans Are The Saviors Of Social Security And Medicare!’ And ‘Republicans Will End Gridlock’

The whole point of Republican rhetoric these days is to try to switch labels: that Democrats were responsible for the Great Depression, and that Republicans are responsible for all economic and social progress under the New Deal.

Now, imitation may be the sincerest form of flattery, but in this case it is most common or garden variety of fraud. You have all been to the circus, but even the best performing elephants could not do a handspring without falling flat on their backs.

[FDR- 1940 campaign]

If it were not so tragic, it would indeed be funny.

The greatest purveyor of gridlock, obstruction, hurting the American people so that they would feel bad enough to blame the president… i.e., Mitch McConnell (R-KY)… he says that he will end gridlock!

Republicans, and only Republicans, have tried to privatize Social Security. Republicans have been against Social Security from the day it was conceived.

Ronald Reagan, Republicans’ saint, made his political debut explaining how Medicare would destroy all freedom and liberty in the country.

Republicans in 2011 and 2013 voted to transform Medicare into a voucher program. No more guaranteed benefits. Good luck shopping around for insurance if you can find an insurer to take you on if you are elderly and have several chronic illnesses. Oh, and good luck to younger people whose premiums would skyrocket if the elderly were included in their insurance pools.

And, yet these same Republicans are attacking Democrats who fought for these popular programs, who sometimes lost their seats due to lies and innuendo about their votes for these programs, for the “sin” of (wrongly, in my opinion) signaling a willingness to compromise to reduce long-term outlays from the program as Republicans were polluting the media with cries of “Greece, Greece, Greece.”

They lie about the president “taking” $500B from Medicare, when all he did was reduce payments to providers. Not a single person, nor a single procedure or illness, has lost coverage. Indeed, President Obama extended Medicare’s solvency from 2016, when it was due to go bankrupt, to at least 2030.

That is, thanks to President Obama, there is no pending financial crisis in Medicare. Thanks to President Obama, no one has lost a drop of coverage. Thanks to President Obama the amount of money seniors have to shell out for their prescription drugs is falling, with full closure of the “doughnut hole” in Part D of Medicare occurring in the following years. Thanks to President Obama, preventative care is covered.

That is, thanks to President Obama, seniors are getting much better coverage for a lower cost. By contrast, Republicans continue to try to destroy the entire program that they always opposed.

And, yet, Republicans attack Democrats, pretending to be Medicare’s defenders.

It should be the campaign’s biggest joke. But, with millions of Koch-dollars behind the ads, lying about the programs, lying about their impact, it is no joke.

It is a tragedy.

As if Republicans are really interested in protecting these programs. They wish they never existed, and want to get rid of them. They have voted for measures to destroy Medicare, and sprung privatization on the American people in 2004 when they were elected without breathing a word of it during the campaign.

Because, if the Republicans do take power, they will destroy the programs they claim to champion.

And, no one will know what killed them.

 

By: Paul Abrams, The Huffington Post Blog, November 2, 2014

November 4, 2014 Posted by | Midterm Elections, Mitch Mc Connell, Republicans | , , , , , | 1 Comment

“Rick Scott Gets An Earful In Florida”: Talking To Regular People Who Don’t Have A Script To Follow Could End Your Career

There’s a reason so many politicians embrace carefully managed, pre-scripted events: they never know what actual people are going to say. The spontaneity may be refreshing for the rest of us, but for politicians and their aides, it’s frustrating when the public goes “off-message.”

Almost exactly two years ago, this happened to Mitt Romney’s presidential campaign in Pennsylvania, when aides arranged for the candidate to chat with a group of regular folks about the economy. One voter said, “None of us like to pay more taxes, but sometimes that’s necessary.” Another added, “It’s a necessary evil.” “Right, right,” a third person said as the group nodded.

The Republican presidential hopeful didn’t do too many unscripted events after that.

This week, Florida Gov. Rick Scott (R) ran into similar trouble. The Republican governor, facing a tough re-election fight, is heavily invested in condemning the Affordable Care Act, so he visited a South Florida senior center for a roundtable chat with retirees he assumed would agree with him.

Oops.

The 20 seniors assembled for a roundtable with Scott at the Volen Center were largely content with their Medicare coverage and didn’t have negative stories to recount. And some praised Obamacare – a program that Scott frequently criticizes.

“I’m completely satisfied,” Harvey Eisen, 92, a West Boca resident, told Scott.

Eisen told the governor he wasn’t sure “if, as you say,” there are Obamacare-inspired cuts to Medicare. But even if there are, that would be OK. “I can’t expect that me as a senior citizen are going to get preferential treatment when other programs are also being cut.”

Ruthlyn Rubin, 66, of Boca Raton, told the governor that people who are too young for Medicare need the health coverage they get from Obamacare. If young people don’t have insurance, she said, everyone else ends up paying for their care when they get sick or injured and end up in the hospital.

Twisting the knife, Rubin added, “People were appalled at Social Security.  They were appalled at Medicare when it came out. I think these major changes take some people aback. But I think we have to be careful not to just rely on the fact that we’re seniors and have an entitlement to certain things…. We’re all just sitting here taking it for granted that because we have Medicare we don’t want to lose one part of it. That’s wrong to me. I think we have to spread it around. This is the United States of America. It’s not the United States of senior citizens.”

The underlying point of Scott’s visit was to try to complain about Medicare Advantage reforms and how awful recent “cuts” must be for seniors. But when the governor asked one elderly woman if she’d seen any changes, she said, “Not really.” Another member of the roundtable said he’s “very happy” with the current coverage. A third person said he’s had “no problems.” A fourth said she and her husband are “very pleased.”

When Scott asked if they’ve found doctors opting out of Medicare, most said, “No.”

It was at this point that the governor probably decided he no longer wants to talk to regular people who don’t have a script to follow.

For the record, as Scott probably knows, these so-called “cuts” to Medicare Advantage aren’t really cuts to beneficiaries. At issue are Medicare cost-savings embraced by the Obama administration through the Affordable Care Act. The so-called “cuts” are changes to the way in which the government reimburses insurance companies, which have been overpaid in the Medicare Advantage program.

What’s more, congressional Republicans – not exactly a moderate bunch – have already endorsed and voted for these “cuts.”

It’s likely the governor understands this, but hopes to fool voters. If yesterday was any indication, his efforts aren’t going well.

 

By: Steve Benen, The Maddow Blog, April 30, 2014

May 1, 2014 Posted by | Affordable Care Act, Obamacare, Rick Scott | , , , , , , , | 1 Comment

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