Town Hall Meetings on the Ryan Budget Raise Concerns
Various congressional representatives held town hall meetings recently, and the news channels and print media were abuzz with the lively give-and-take, including shouting matches. See, e.g., House G.O.P. Members Face Voter Anger Over Budget, New York Times, Apr. 26, 2011; Republicans facing tough questions over Medicare overhaul in Budget Plan, Washington Post, Apr. 22, 2011.
The issue–the House’s adoption of the Ryan budget proposal and its clear agenda of overturning New Deal safety nets embodied in the current understanding of Medicaid, Social Security and Medicare.
Those at or near retirement are worried that the Ryan proposal will hurt everybody. The Ryan proposal comes with frequent disclaimers about protecting the already older population and needing to act now to protect our grandchildren, a clear effort to massage the message to appeal to current grandparents. See, e.g., House G.O.P. Members Face Voter Anger Over Budget, New York Times, Apr. 26, 2011 (noting Webster’s statement that “not one senior citizen is harmed by this budget” while implying that it is necessary to prevent grandchildren from “looking at a bankrupt country”); Congressional Republicans go home to mixed reveiws, CBS.com, Apr. 26, 2011 (noting North Carolina GOP Rep. Renee Ellmers’claim that “If you’re 55 and older, your Medicare and Social Security will not change”).
But the Ryan proposal clearly envisions mechanisms that would likely lead to decimation of these programs–either through turning them into limited vouchers (Medicare proposal); turning the funds over to the states to use as they see fit (Medicaid proposal) or limiting benefits (Social Security proposal) in ways that will –probably sooner rather than later– hurt everybody.
- These proposals take place in a context of expansive, concerted attacks on these “entitlement” programs, often failing to acknowledge the historic support for these programs or their foundation in the recognition that federal support is required to protect against the abject poverty and humiliating degradation that accompanied the Great Depression;
- Benefits for elderly and sick Americans are cut to provide savings to offset some of the loss of revenues from tax cuts for Big Business and the wealthy, both of whom already pay relatively low taxes, in what hardly seems a bargain to the working poor, the elderly or in fact the overwhelming majority of Americans who are not in the top 15% income or wealth distribution. (This in spite of Ryan’s claim that there is no huge tax cut for big corporations and the wealthy–he asserts that the proposed 25% rate is “in exchange for losing their tax shelters”. See, e.g., CBS.com Evening News coverage of Paul Ryan holding Wis. town meetings, at http://www.cbsnews.com/video/watch/?id=7363939n&tag=related;photovideo )
- In spite of the high cost for the vulnerable poor and elderly of these budget proposals, they don’t appear likely to achieve their proffered rationale of reducing debt and deficits–in fact, the CBO has said that the Ryan budget proposal will result in higher deficits and bigger debt burdens over the next decade.
- It appears shortsighted to wring one’s hands about a “bankrupt country” while considering only one potential solution, especially when that solution is highly detrimental to the most vulnerable populations, and without considering the full facts regarding the amount of debt, the ability of the U.S. to weaken the dollar further to aid unemployment and debt payment, the ability of the U.S. to raise taxes judiciously rather then merely cutting spending, or the ability of the U.S. to let the tax law play out as it is currently slated to do (with the Bush tax cuts that were extended 2 more years over their originally intended short life due to sunset in 2012). As Jim Johnson, a former Ryan supporter who has “grown increasingly disgusted” with Ryan noted, “[Ryan] says Medicare is unsustainable. I’m thinking, ‘Yeah, it’s because medical costs are out of control.’ …Why isn’t he attacking it at that level?” Congressional Republicans go home to mixed reviews, CBS News.com
- Any voucher system for health care will inevitably fail to cover increasing health care costs, resulting in rationing even the most basic health care by socio-economic class–the very problem that Medicare, Medicaid, and the limited health care reforms undertaken by the last Congress were intended to address. The Center for Budget and Policy Priorities concluded that out-of-pocket medical costs would skyrocket for low-income seniors; the Washington Post’s Fact Checker Glenn Kessler (in GOP Lawmakers tout Medicare reform by stretching a comparison to the health benefits they receive, Apr. 29, 2011) notes that the CBO analysis concluded that the Ryan Medicare system would pay only 32% of health care costs by 2030, compared to 70-75% if traditional Medicare remained in place.
- Addressing the problems in the U.S. health care system solely by market means that put the onus on health care recipients to seek cost-savings has failed miserably over the last forty years and cannot help but fail more spectacularly when the Medicaid backup is weakened and the nature of health care needs is such that one of the best antidotes to market problems (the only one permitted in radical market thinking that objects to regulatory safeguards)–informed consumers who can review options and select among competing providers–is simply not applicable. Car accident victims don’t shop for surgeons; cancer victims don’t know enough to select based on price; etc.
- The Ryan proposal appears one-sided in its decision to cut spending on potentially vulnerable populations rather than to address the means through which health care is provided or to consider ways to control profit-taking in the health care system. The market ideology of the proposers leaves many options that might work better off the table (single payer; tax on excessive compensation; revamping the non-profit hospital system; attaching strings to the R&D and other tax expenditures in the tax code; using the clout of a national system to negotiate better doctor and drug pricing for Medicare and Medicaid, etc.);
- Many of those states that would acquire more control over the use of Medicaid funds are controlled now, as is the House, by people who have announced their intent to cut taxes on the wealthy and business while cutting or taxing pensions and health benefits for public employees and cutting funds available for Medicaid and other poverty-directed programs; it is not a difficult leap to see the interrelationship of these trends;
- Plans to cut benefits for those who may enjoy them in the future pave the way in at least two ways for decisions shortly thereafter to cut benefits for those who currently enjoy them: first, by creating lowered expectations; second, by creating an unfair disparity that supports an “us against them” attitude between the current elderly and those who will get lesser benefits in the future. (Note that this resembles the way the right has encouraged an “us against them” attitude of private workers, who have been deprived of union benefits through the harsh anti-union tactics used by Big Business, against public employees, who have generally benefited in the past from more reasonable attitudes towards unions fostered in legislative bodies that have, in the past, understood the nature of the bargain that public employees make (which might be summarized as ‘work hard, get paid less than you could in the private sector, and accept later benefits in pensions and health care for lesser salary/percs now).
Is is surprising that left-leaning activist groups like Move-On point to the Ryan budget proposal as a “naked, unapologetic attack on working Americans for the sake of Big Insurance and the riches of the rich” (quote from Move-On email on this matter)?
Ryan’s plan is not going to fly. I haven’t seen a plan from the Congress thus far that has any likelihood of passage. Perhaps the Senate Gang of Six will propose a plan that may be adopted in the end.
I fully expect that we will witness a major financial crisis a few years down the road that will force the Congress to undertake actions necessary to rein in the unsustainable financial path of the U.S. Government.
All of the normal political banter and outrages we will be hearing from Democrats, Republicans, and others will probably not result in meaningful action on the growing Federal debt problem until a financial crisis occurs. Some actions, perhaps, but certainly not enough to deal with the projected Federal Budget problems that will occur after 2020. I see no evidence to suggest otherwise.
It’s interesting that Beale didn’t mention the hits that Ryan wants to apply to Other Mandatory spending. That is where the largest hits were identified.
Vouchers for aged Americans to buy medical insurance, makes the medical insurers same as the military industrial complex, profits bought and paid for by the taxpayer, and no results expected.
I would call it the medical insurance cabal, and it would own congress just as the corporate arsenals.
All cost plus, good profit from the taxpaying workers.
And in none of this is the simple obvious plan of letting the workers pay for their own insurance, and requiring the “taxpayers” to pay for what they already bought, even mentioned.
we can’t raise taxes, see, because that would hurt the economy. i read it in Leviticus.
oh, dear, i forgot that “pay for their own insurance” would be understood to mean “privatize it.”
no, i meant raise the payroll tax forty cents per week per year to pay for Social Security, and a similar amount to pay for Medicare.
i realize that the “whole Medicare” including the non payroll tax part of it might be even more expensive. the question would still be “do we want the medical care” is there a cheaper way to pay for it” or “can the government bring down costs by using the leverage of Medicare to drive better bargains with the providers.
as for more tax cuts for the rich. i’m about sick of that.
There is a cheaper way to do medical care: (This is somewhat tounge in cheek). Allow travel to Cuba for medical purposes, it appears there are lots of physicians there, and allow export of medical equipment and supplies. Hospitals will pop up all over, and if Medicare pays for elective surgery and recovery there, it will help everyone. Given that the cuban physicians are able to do so much with very little how would they do with much?
Has anybody compared the many budget proposals for what they would do in FY 2012, as opposed to the 2020s? I know Ryan and the GOP proposed a $1T deficit for next year, and Obama proposed a $1.1T deficit, so on the surface those two don’t seem to be too far apart. Still, perhaps we simply should plan for a series of continuing resolutions and government shutdown threats again. After all, we’re quite busy posturing for an election in which voters will weigh-in on whether America can and should tax to keep old poor people alive.
For your weekend entertainment as you think about long-term issues, here’s a very old TV interview with Ayn Rand: http://www.feld.com/wp/archives/2009/12/mike-wallace-interviews-ayn-rand-about-objectivism.html
They want to tell us they will protect our children and grandchildren by having them perform a high wire act without the safety net the New deal and unions used to provide. How can they be so confident the majority of the voters will go for that? Sadly, it looks like many working middle class people go for it.
Ryan and friends don’t explain how flat rates and reduced loopholes would be better than the present rates and would not reduce revenue? Tax cuts don’t reduce revenue, so they say, but what do pay cuts and unemployment do for the economy? Destruction of unions, pay cuts and lay-offs and removing the social safety net that is like clear-cutting the working middle class.
Krugman nailed it as usual this week as he explained that the Ryan plan does not address the deficit. It only uses it as a tool to further other less visible ends.
Insurance companies already have pilot programs sending clients abroad. See Halasy’s post on medical tourism.
The Republicans have finally taken all that rope they’ve been given for so long to hang themselves with, and have hanged themselves with it.
It looks like the Ryan plan has really spooked a lot of non-wealthy Republican whites, including a lot of elderly people. That, along with the Tea governors’ bald assault on the very idea of collective bargaining, and their wholesale, dramatic reordering of state budget priorities and of the concerns of state government itself, has finally educated the public to what the Republican Party is really after.
The indications so far are that this sudden education of the public isn’t working so well for the Republicans. I doubt that that will change, now that the public finally knows the specifics of their policy goals. I think the backlash will just keep gathering steam.