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Romryanomics–prosperity for the well-off fueled by austerity for the rest

by Linda Beale

Romryanomics–prosperity for the well-off fueled by austerity for the rest

I’ve put off writing about stilted robo-Romney’s choice of the perpetual-smily-Ryan as veep about as long as I can, I suppose.  So let me talk about it in broad terms in this post.  In the next posts, I’ll discuss more methodically the vacuous “Romney program” and the toxic “Ryan path to prosperity” with particular attention to what they have said specifically (or not, in Romney’s case) about what they want to do with the tax system.

Both Romney and Ryan come from well-to-do families with the privileges of financial support, status and connections that adhere thereto (see this story on Romney–by the way, a donated inheritance is still an inheritance and donations of that magnitude earn other privileges for the elite; and this story on Ryan–whose wife also inherited millions including oil and gas interests), yet support the neoconservative economic mythology that wealth is wholly based on merit and that the way to have a good economy is to make sure the wealthy, who are deemed to be the (mythic) “job creators” are happy.  This leads them to support austerity for the middle class and seniors coupled with deregulation, privatization, militarization and tax cuts–Romryanomics 101.

Key to the Romney program (or what can be derived from a description of generalities-without-specifics that can’t be scored by economists plus Romney’s statement earlier that he would sign Ryan’s budget proposal into law if passed by Congress plus his Monday statement that “his own plan for Medicare is ‘very similar’ to Ryan’s”, per this story ) and the Ryan so-called “path to prosperity” (see, e.g., the LA Times story) is privatization of, and spending cuts to, Social Security and Medicare, along with spending cuts to everything else that serves the public good (environmental programs, parks, etc.) and vulnerable minorities in this country and isn’t part of the military-industrial-financial complex.  That is, social welfare programs that have made the difference between poverty and dignity for American seniors will be undone by some level of privatization and benefit cuts, to accomodate unmerited tax cuts for the wealthy and increased spending on the military (notice the echos of Bush’s Iraq-war buildup in the talk about being tough on Iran and extraordinarily friendly to Israel coming from the campaign).

Of course, this program of tax cuts, militarization, and deregulation has already been tried–those are the ideas that failed to deliver a robust economy under George W. Bush, who had an anemic recovery from 2001-2004 in spite of the $1.3 trillion in tax cuts over ten years enacted in 2001 and the continuing tax cuts carried out in 2003 and 2004.  Nor did Bush’s imperialistic militarization through two preemptive wars deliver a robust economy.  Instead, the rash of financial speculation and finanialization of the economy pushed us into a deep financial crisis and the Great Recession.  Those ideas will upend the recovery from that recession that has been underway under Obama.

Both Romney and Ryan have personally benefited from the kind of government that recognizes the importance of public-private cooperation in institution and infrastructure building, yet pontificate that government is always less efficient than private enterprise.  That rhetoric is used to justify stifling innovative programs like supporting experiments in environmentally sound energy development, but it doesn’t come into play as far as continuing to ladle out tax-code largesse to the profitable oil and gas extractive industry or coddling financial institutions through deregulation (Romney, for example, supports dismantling Dodd-Frank, an already timid effort to rein in financial speculation; Ryan voted for TARP and against Dodd-Frank, positions that garnered Republicans a haul of financial industry contributions).  That approach will continue the George W. Bush trend of the financialization of the economy and likely land us in another, even worse, systemic financial crisis.

Both had ancestors that benefited greatly (in terms of prestige and in terms of economics) from their involvement in and with government.  Romney’s father George, of course, was a well-known governor of Michigan –and  a wealthy corporate CEO in the auto industry that benefited hugely from the government shift from investment in railroads to investment in roads.  Ryan’s family reaped its riches at the public trough–involved in the kind of public-private partnerships that made the transcontinental railroads possible (and built enormous wealth for the railroad builders) and the interstate highway system possible (and built enormous wealth for the highway builders).  See Libby Spencer, Ryan family fortune built on taxpayer money, (Aug. 14, 2012);  Sally Kohn, Paul Ryan didn’t build that! (Aug. 14, 2012) (noting that  the Ryan family, starting with his great-grandfather building railroads, has profited from government contracts over more than a century, including “at least 22 defense contracts … since 1996”).
Romney likes to think of himself as a successful businessman who can lead the country by supporting business.

But Romney is mainly a vulture capitalist.  His private equity firm bought companies that were doing well and providing good US jobs, loaded them up with debt so that outsize profits could be made for the Bain “investors” (himself included), and –if it helped them make even more outsize profits–enjoyed firing the “excess” workers. Private equity firms don’t produce anything.  While the right applauds the so-called “creative destruction” that tears existing companies apart to sell off the pieces for more or to enable firing the workers and breaking a union contract, those activities don’t add to a sustainable economy.  They  mostly look for companies they can take over, with no regard for the workers’ lives or the communities in which the companies exist, in order to capture what economists refer to as “rent” profits, usually through loading the companies up with debt.  Some of the companies thrive or just survive, but many of the workers don’t, since cutting workers is a favored cost-cutting measure.  Some of the companies go bankrupt, leaving all the workers in the lurch and usually without promised pensions.  Some of the companies turn to outsourcing workers in order to make enough to pay off the debt.  There’s not much in vulture capitalism that bodes well for a vulture capitalist as president.

Ryan likes to think of himself as a principled thinker who will push for what he considers appropriate policies (no matter, apparently, their impact on vulnerable seniors or middle-class Americans).  As Ryan’s 2005 speech to the Atlas Societymade clear, he has been an avid follower of Ayn Rand, the alpha-male praising, privileged-innovator(“producers”)-elite loving, anti-societal cooperation, anti-altruism,  radical libertarian, free-trade “objectivist” author that has been called the “Goddess of the Market” (see Jennifer Burns, Goddess of the Market: Ayn Rand and the American Right).  Ryan even told the Weekly Standard in 2003 that  “I give out ‘Atlas Shrugged’ as Christmas presents, and I make all my interns read it,” he said. “Well… I try to make my interns read it.” Rachel Weiner, What Ayn Rand says about Paul Ryan, Washington Post (Aug. 13, 2012).  Lately, though, he’s been trying to distance himself from Rand, perhaps because he finally learned that her brand of radical libertarianism derived from atheism rather than theism.  Kate Sullivan, Veep nominee Paul Ryan renounces former fascination with Ayn Rand, NY Daily News (Aug. 14, 2012).

cross posted with ataxingmatter

America is an Opportunity Society (Rep Paul Ryan WI)

by Run 75441

America is an Opportunity Society (Rep Paul Ryan WI)

I’m personally offended that they’re playing a high-stakes game of chicken with our national defense,” fumed Weston Newton, chairman of the Beaufort County Council, after hearing Senator Graham’s dire warnings. . Lawmakers look for way out as defense cuts near.

After agreeing to automatic cuts if a resolution to the deficit could not be agreed upon in the budgeting process, some members of the Senate now what a redo. Senator Graham goes to great lengths to stir the guns and/or butter pot of fear.

· The law exempts war costs and allows the administration to wall off personnel levels and military pay, about a third of the Pentagon budget. That means everything else — operations and maintenance, research and development, procurement, fuel, military construction — would face immediate cuts as deep as 13 percent,” Mr. Harrison said.
· “‘Our ability to modernize will be basically gutted,’ Senator Graham told National Guard officers in Greenville. ‘The Marine Corps will have to choose between its giant training camps in San Diego or Parris Island, he told community leaders in Beaufort, a stone’s throw from Parris Island.”
· “‘The C-17 fleet at Joint Base Charleston would be ‘devastated,’ Senator Graham warned city leaders at the Charleston Chamber of Commerce. The cuts to the soldiers and airmen at Shaw Air Force Base would leave behind a ‘hollow force,’ he intoned in a windowless room at the Quality Inn in Sumter.'” 

During the month of May, a House majority voted to shift the automatic cuts for Defense (resulting from the failure to approve a budget) to cuts of Domestic programs. The National Defense Authorization Act passed the House 218 to 199 in Reconciliation with Wisconsin Representative Paul Ryan (strictly a guns guy) sponsoring cuts in Medicaid ($50 billion), food programs for the poor ($36 billion), federal retirement funds ($80 billion), and capping malpractice lawsuits to save $49 billion. The Act also proposes to increase Defense spending $8 billion (enough to fix 40,000 $200,000 flawed mortgages

  Paul Ryan Budget: House Passes Bill To Spare Defense, Cut Food Aid, Health Care

While sequestered an agreement was not reached by the handpicked members of Congress who would never reach an agreement in a decade, the Budget Control Act with its default cuts now adds another $500 billion in cuts (over the next decade) on top of the agreed upon $487 billion in Defense spending cuts agreed to last Summer. In a “Quelle Surprise” moment, the DEMs appear to be showing some backbone and the Republicans are finding the Dems are serious about the burden of program cuts falling equally over all programs.

We will sit and stagnate with banks and use rockets, To oversee that it’s our bottom line that gets carried to the high seas.” Shikari. Norquist would be proud of these pseudo budget cutters.
Falling back on the rhetoric of a built-in culture of dependency, Ryan fights back on the proposed cuts in domestic programs; “Here’s the problem: These efforts aren’t working. One in six Americans today are in poverty, let’s get back to the idea of America as an opportunity society.” It is not the two recessions in a decade, the cutting of jobs or globalization at issue, or the stagnation of income, which has led to an increasing portion of the Non-Institutional Civilian Population to reside in Not In Labor Force nor is it reductions in tax revenue; it is a culture of dependency as created by domestic programs. Another “Quelle Surprise

moment in politics! Moreover, if we cut food and healthcare we can force them to work. When did healthcare become that cheap and affordable while earning a minimum wage? Which do you do, cast the bones of the future, gamble with your health, and forgo healthcare to buy food or the alternative is to diet? Investing more money in the military, expanding our military presence, and cutting domestic programs; Rep. Paul Ryan believes will solve the economic problem much of the population faces today.

Maybe in the past, the US in its early product life cycle of growth had the resource and the potential to expand the military and invest in the domestic economy; but today, the resources are limited and continuing to invest so heavily in the military could result in an erosion of global economic position. In “The Rise and Fall of the Great Powers;” Paul Kennedy examines the growth of Defense (guns),
clip_image001clip_image003Rise and Fall

armaments, global commitments, etc. without an increasing and sustaining Domestic economy and Economic Investment (butter) concluding it has been a greater contributor to a nation’s demise as a world power and relegated to second or third tier status. Kennedy does so by reviewing the nations, which have been world powers since the 16th Century and compares those former world powers and circumstance in the end with the US. He analyzes the ability to engage in conflict(s) sustained or otherwise and increased military expenditures without adequate or increasing resource of energy, other natural resource, and domestic productivity. The US with a faltering economy, an unproductive large labor pool, and an emphasis on financial and Wall Street gambling may be no longer able to sustain the military and the military complex it has today.

As Paul Kennedy suggests a continuation of such policy could “lead to the downward spiral of slower growth, heavier taxes, deepening domestic splits over spending priorities, and weakening capacity to bear the burdens of defense

Hmmmmm, does it sound familar? and adds:

The task facing American statesmen over the next decades, therefore, is to recognize that broad trends are under way, and that there is a need to “manage” affairs so that the relative erosion of the United States’ position takes place slowly and smoothly, and is not accelerated by policies which bring merely short-term advantage but longer-term disadvantage. The-Rise-and-Fall-of-the-Great-Powers

It may be time to rethink our present stance on military expenditures and focus on domestic investments which will revitalize the country and bring more of those people Paul Ryan targets back into the Civilian Work Force. When the automatic cuts go into play; they will not go realign military policy favoring domestic policy; but, the Paul Ryan’s of Congress would go a long way towards providing the “Opportunity Society” he is calling for by doing so. It is an opportunity much of Congress seems to be blind too in their quest to unseat Obama and follow the pledges to Norquist.

Bait and Switch: Is Pope Benedict Really Against Raising Taxes On the Wealthy to Help Balance Government Budgets?

(Reuters) – Invoking Pope Benedict, Republican Representative Paul Ryan defended his budget plan on Thursday at Georgetown University, where a group of the Jesuit institution’s faculty has accused him of misusing Catholic teachings to push cuts to programs that serve the poor.

“The overarching threat to our whole society today is the exploding federal debt,” Ryan said, speaking in a Gothic, oak-paneled auditorium on the Georgetown campus.

“The Holy Father, Pope Benedict, has charged that governments, communities, and individuals running up high debt levels are ‘living at the expense of future generations’ and ‘living in untruth.'”

— “Republican Ryan cites popeto defend budget cuts,” David Lawder, Reuters, Apr. 26

The overarching threat to our whole society today is the exploding federal debt?  Well, maybe. But this is an argument against raising revenues by raising taxes on the wealthy?  Or, for that matter, on anyone?
What’s most angering is this deliberately disorienting, gimmicky refusal by these pols—Ryan and Romney, in particular—to acknowledge that raising revenue through taxes reduces the government’s budget deficit and debt; that lowered tax rates in the last 11 years have significantly increased budget deficits and the debt (and that that also happened in the 1980s); that budget deficits and the national debt decreased during the 1990s after tax rates were raised during the G.H.W. Bush administration; and that Ryan’s and Romney’s tax-reduction plans would, according to (apparently) all projections except their own, substantially increase the national debt. 
It’s one thing to argue for a substantial reduction or elimination of the national debt, but quite another to pretend that raising tax revenues isn’t one possible way to help do that.  
These people do make Ayn Rand philosophical arguments to support their policy proposals, but the claim that the pope “has charged that governments, communities, and individuals running up high debt levels are ‘living at the expense of future generations’ and ‘living in untruth,’” is a non sequitur to the question of how we reduce the national debt.  

It appears, though, that this particular bait-and-switch—Ryan’s claim that the pope supports his budget proposals because the pope has expressed concern about high debt levels of governments, communities and individuals—is causing outright revulsion among both mainstream media pundits and the general public once they hear about it.  The pope as Ryan’s budget guide?  Really?  Comments posted to an article about it yesterday on Slate, titled “Paul Ryan Cites Pope In Defense of Budget Plan,” almost universally express disgust and dismay at Ryan’s claim.  The pope as Ryan’s budget guide?  

The beauty of Ryan’s statement is that it helpfully highlights that, Romney’s insistence to the contrary, this election is not about the present and future economy—will cutting taxes for the wealthy by 20% and eliminating the EPA and banking regulations really spur the economy and lower the national debt?—but instead about the very structure and purpose ofgovernment itself.  And because Ryan has now invoked the pope as supposed political supporter of Ryan’s budget, the real Republican intent will likely gain widespread attention.

Halleluiah.  And praise the pope.

Ayn Rand v. Thomas Aquinas in Paul Ryan’s Mind

by Mike Kimel

Ayn Rand v. Thomas Aquinas in Paul Ryan’s Mind

Think Progress piece on Paul Ryan.

Think Progress has a post noting that though Paul Ryan used to go around telling people he got into politics because of Ayn Rand, and he required all his aides to read Atlas Shrugged, now he tells the National Review:

“I reject her philosophy,” Ryan says firmly. “It’s an atheist philosophy. It reduces human interactions down to mere contracts and it is antithetical to my worldview. If somebody is going to try to paste a person’s view on epistemology to me, then give me Thomas Aquinas,” who believed that man needs divine help in the pursuit of knowledge. “Don’t give me Ayn Rand,” he says.

I’d be inclined to believe him if he started handing out copies of the Summa Theologica (in the original Latin, of course) to his aides and requiring them to read them as he did with Atlas Shrugs. But seriously, Aquinas? On the plus side, what he wrote is free today. (Here’s the Summa Theologica, considered his greatest work, in English.) I’ll be honest – I tried to stumble through the Summa Theologica in my youth, but with no success. That said, I don’t I’d pay to hear Ryan explain Aquinas’s work (provided it was a truthful and honest explanation) and how he plans to implement it to the American public. I’d especially love to hear him explain this to the banking community:

Consequently, just as it is a sin against justice, to take money, by tacit or express agreement, in return for lending money or anything else that is consumed by being used, so also is it a like sin, by tacit or express agreement to receive anything whose price can be measured by money. Yet there would be no sin in receiving something of the kind, not as exacting it, nor yet as though it were due on account of some agreement tacit or expressed, but as a gratuity: since, even before lending the money, one could accept a gratuity, nor is one in a worse condition through lending. On the other hand it is lawful to exact compensation for a loan, in respect of such things as are not appreciated by a measure of money, for instance, benevolence, and love for the lender, and so forth.

Of course, if Bank of America did start making loans simply out of benevolence or to encourage love for the lender, perhaps they’d make a lot fewer loans of the type that later require the benevolence of the Treasury and the Fed to bail them out.

Here’s more from the Summa Theologica

Things which are of human right cannot derogate from natural right or Divine right. Now according to the natural order established by Divine Providence, inferior things are ordained for the purpose of succoring man’s needs by their means. Wherefore the division and appropriation of things which are based on human law, do not preclude the fact that man’s needs have to be remedied by means of these very things. Hence whatever certain people have in superabundance is due, by natural law, to the purpose of succoring the poor. For this reason Ambrose [Loc. cit., 2, Objection 3] says, and his words are embodied in the Decretals (Dist. xlvii, can. Sicut ii): “It is the hungry man’s bread that you withhold, the naked man’s cloak that you store away, the money that you bury in the earth is the price of the poor man’s ransom and freedom.” Since, however, there are many who are in need, while it is impossible for all to be succored by means of the same thing, each one is entrusted with the stewardship of his own things, so that out of them he may come to the aid of those who are in need. Nevertheless, if the need be so manifest and urgent, that it is evident that the present need must be remedied by whatever means be at hand (for instance when a person is in some imminent danger, and there is no other possible remedy), then it is lawful for a man to succor his own need by means of another’s property, by taking it either openly or secretly: nor is this properly speaking theft or robbery.

Like I said, I’d love to hear Ryan explain this stuff to the American public. But somehow I don’t think this is what Ryan had in mind when he says “give me Thomas Aquinas.” I’d be willing to bet he read less of Aquinas than I did. Hat tips to both Paul Krugman and TBogg (great minds think alike?).

Apple Whines About Having to Pay Taxes

Given Ryan’s release of his new plan calling for territorial taxation of corporations comes this example of Apple from Kenneth Thomas, Middle class political economist econoblog:

Apple Whines About Having to Pay Taxes
by Kenneth Thomas
On Monday, Apple announced that it was going to start paying dividends to shareholders, and buy back $10 billion worth of stock. What caught many people’s attention in the subsequent conference call, however, was the company’s pointed statement that it would not be bringing back any of the cash it holds overseas, estimated at $64 billion, or over 64% of its current cash on hand.
The reason, as stated by Chief Financial Officer Peter Oppenheimer, is that it would have to pay taxes on this money if it were repatriated to the United States. Apple made the money, so it owes taxes on it just like you or I would. But because the money was earned overseas (though realistically, some of it probably got there through transfer pricing), it can defer paying taxes on it until the money comes home. Taxes deferred are taxes reduced due to the time value of money, but that’s not enough for Apple. In good Mitt Romney fashion, Apple is working with other companies to try to get the tax laws changed in its favor.What they want, as Carl Franzen of TPM points out, is a “repatriation holiday” that will allow them to bring back the money at a greatly reduced tax rate, as in 2004. Franzen notes:

However, in that 2004 experiment, pharmaceutical companies were the largest beneficiaries and although $312 billion was brought back into the U.S. by some 800 companies, most of the money was spent on dividends and stock repurchases, as Bloomberg and the New York Times both reported, referring to numerous studies. In fact, some of the companies that benefited the most from the 2004 tax holiday ended up laying off employees.

Today, despite having just gone through the worst economic crisis since the Great Depression, U.S. multinationals now have over three times as much overseas as was brought back in 2004, some $1 trillion, according to Franzen’s article. Apple’s action Monday suggests that more dividends and stock repurchases would be the order of the day once again if they got their way.
According to Justin Fox, the $64 billion is “sitting in Apple’s overseas subsidiaries…” This almost certainly means it is in Ireland: According to Apple’s 2011 Annual Report (Exhibit 21.1), it has only two “significant” subsidiaries outside the country (and one significant subsidiary in the U.S.), both of which are in Ireland. Apple, then, is simultaneously benefiting from Ireland’s tax haven status and the deferral provisions of U.S. tax law.
What should be done? I agreed with Citizens for Tax Justice in January that not taxing worldwide corporate profits would give companies even more incentive to make their profits show up overseas than they do now. Fox notes a similar argument from tax attorney Edward D. Kleinbard, who says that ending the deferral provision is the right way to go. That way, companies’ income would be taxed in the year it was earned, and multinationals would get no benefit relative to domestic companies that don’t squirrel away their profits overseas. It would go a long way to ending our current situation where there is one tax law for the 1% and another one for the rest of us.

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,, 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., Evening News coverage of Paul Ryan holding Wis. town meetings, at;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
  • 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)?