Coupon Care and The Phony Entitlement Debate

I'll leave it to the able hands of Ezra Klein, Steve Benen and Paul Krugman to act as the wrecking crew on Paul Ryan proposals on the elimination of Medicare and Medicaid (lest we forget). They are more able to get into the weeds than I am.

Michael Gerson writes of how admirable and courageous Paul Ryan's plan but that it is not complete. First, it's no longer Paul Ryan's Plan, it is the legally voted on proposal of the Republican Party. And it is totally fair for the Democrats to hang the whole thing on everyone who voted for it.

Gerson argues that there needs to be a coalition formed of advocates for entitlement reform. He argues, quite correctly, that this coalition would take conservatives out of their comfort zone. He argues that the expansion of costs for so-called 'entitlement" programs will eat up everything left for discretionary spending in the federal government.

First objection I have is to zeroing in first on entitlements as the primary drivers of the current debt crisis. Let's get back to the priorities here. The primary debt drivers are the wars, the Bush tax cuts, and the recession itself. It is dishonest and ideologically motivated to start the debt discuission with those very things you want to eliminate anyway.

Second, I do not believe the House Republican Plan is courageous or visionary or even honest. Paul Ryan is very sensitive to the criticism this Plan provoked and he claims the Democrats are demagoguing on this issue. The problem is that the democrats' critique of his Plan happens to have the virtue of being accurate as opposed to the Republican charges that Obama cut $500 billion in Medicare benefits. If you stop and think about it,why wouldn't Republicans support that.

Third,the CBO and others have all come out with the fact that Ryan's Plan vastly underestimates the costs of his coupon care both to the Government and to the senior. In his plan, the cost of healthcare is not contained or even modified. It continues as a runaway train. One of the key elements of the Affordable Health Care Act debate was the awesome fact that 17% of our GDP is being spent on healthcare costs, almost double and sometimes triple the amount spent by advanced economies.

Fourth, virtually no one has interviewed or gotten an on-the-record response from the health insurance industry about what kind of insurance seniors would actually get. Given the industry's current record, I can't envision great enthusiasm for insuring seniors, except with junk insurance. Wendell Potter, the former CIGNA executive and now whistleblower on the health insurance industry, claims that this is a big windfall for the insurance industry. I look at it as the payback by the Republicans for their attempt to eliminate the individual mandate in the Affordable Act, which would bring them 40-50 million new customers. Therefore the GOP gave them an equal swap. Remember Medicare's overhead is roughly 1.5% compared to the 28-30% overhead for private health insurance.

Fifth,the AP dutifully rang the alarm that Social Security and Medicare would go broke prior to the announced dates. Well, sort of, not really. Social Security would cease to pay me 100% benefits one year earlier than the last two estimates. Medicare again would be one year earlier, although that is depleted more rapidly--in the next 15 years.

Sixth, never make serious life or political decisions that will affect millions upon millions of people n a panic or because of a false sense of desparation. Address the main drivers of the national debt now and actually deliberate on reforming Medicare, Medicaid and Social Security once the recession is over.

Seventh, Paul Ryan's Plan is not the starting point for any discussion on this issue. No journalist has yet investigated where he came up with these ideas because --believe it or not--he doesn't know anything about economics. The other red flag that should alarm people is that Ryan says because of his "economic doctrine" he would not entertain any steps to increase government revenues. This is not a serious man. or maybe he is a serious ideologue.

Eighth, it is a very bad idea to put in stone budget priorities for a generation in the future. We literally do not know what the world will look like. And we certainly do not know what the economy will look like.

Ninth,Paul Ryan was right in one of his townhall meetings that you can not tax your way out of debt. But he neglected to say that you can not cut your way to prosperity. In fact, we know from modern history that it has never been done. In fact, the various European austerity programs now are increasing those countries' debt, not lessening them. It also is a very incovenient fact that the United States has never really balanced a federal budget. Historically, it just hasn't happened and in fact it is not desireable to do so.

Lastly, Paul Ryan did win something. All of Washington, which is now our richest city,actually belives we have a debt crisis. And the nomenklatura have a quiet consensus that cutting government spending is the way to go. Even political Democrats in Congress are very reluctant to propose generating new revenue streams unless it is a populist measure like taking away subsidies for oil companies, which would only bring in about $30 billion a year.

The rest of the country--in poll after poll after poll-is concerned about jobs and the economy. Even with the media banging away day in and day out, this priority has held before and after the 2010 elections. Also, huge majorities of Americans in poll after poll do not want Social Security, Medicare or Medicaid cut. The GOP take-over of the House was the result of the American frustration with Congress for not pushing more job creation programs, not less. What the voter didn't realize is that the Republicans had become so radicalized that they would take their win as an over-arching mandate to dismantle the remnants of the social welfare state. The result is massive voter remorse. Now over 59% of Americans strongly disapprove of the House Republicans.

Paul Ryan keeps peddling the line that by next year the American voters will approve of his position. That can only happen if millions of dollars by the corporations are spent on dishonest political ads.