Right-Wing Social Engineering
Republicans spent their time on the Sunday news shows saying they were the only serious deficit reducers in town. If we didn’t support the Ryan budget plan, we apparently enjoyed watching our country circle the bowl. Since they had the corner on seriousness, they told us the special election in New York was lost because the Democrats demagogued the Medicare issue. GOP mouthpieces called Democratic characterizations of the Medicare provisions of the Ryan budget, “mediscare.” They ignored the generalities put forth in President Obama’s budget and told us Democrats were not serious because they did not have a budget. Additionally, they ignored the ongoing negotiations at the White House led by the Vice-President.
As the “no tax increase, my way or the highway,” GOP negotiates in bad faith with Democrats the seriousness of the Ryan budget seems to be all ours.
I am one of the millions of fourty-somethings in the 100 to 200-thousand net annual earnings category who have become very serious about the Ryan budget. We are serious because we need to plan for the plan. Many of us have taken a sober look at the Ryan plan. We have plowed through all sorts of projections about its real cost to us. Why are we so interested? We are interested because we only have ten or so years to adjust. For us, there are at least two ways to leave our kids with a debt. One is the deficit and the other is a medical bill. By tying Medicare spending to overall inflation and not healthcare inflation Ryan has made us nervous. We are nervous because we see those numbers radically diverging. Those diverging numbers may mean our kids have to pay for daddy’s health care. They may have to pay because, by definition, we will no longer be able to earn a living. While we can still earn a living, we need to begin funding a new unexpected medical slush fund to take care of the Ryan Difference.
Don’t get me wrong, the Ryan Difference may just be the cost of doing business in the world of deficit cutting. I for one am fully engaged and ready to do my part to save the country. I have known for years we could not put two wars, a tax cut, a bailout, a stimulus plan and a prescription benefit on the federal credit card. I understand spending at this rate is unsustainable. Whether or not those things were a worthy spend of my tax money is water over the dam at this point.
Or is it?
I read the Ryan plan and see sacrifices. I see sacrifices in government services. I see uncertainty in my retirement then I see a tax cut made permanent. Unless the Republican Party plans to deport me and others like me, they should at least try to engender some trust among my kind. Without trust, seriousness is called into question. Without seriousness, I ask what the Ryan plan accomplishes. Is it an opening bid? If so, why are the GOP mouthpieces telling us it is the only way? Should the Democrats produce a budget which sticks it to corporations and rich people and also claim it is the only way? Will the parties finally meet in the middle? Aren’t the parties already doing this at the White House?
Until the GOP submits a real budget which distributes the pain evenly, I wish they would quit inferring I am un-American because I can’t support a budget which kills a Medicare entitlement that is central to my whole retirement plan. Stop telling me you are saving my Medicare, when I know you are merely transferring money from my Medicare to rich people in the form of a tax cut. Don’t tell me that money is a tax cut for small business when the current system allows General Electric to pay no taxes and tax breaks for the oil companies. Don’t start the same old mess about “trickle-down” and how good it will be for me to move my money from Medicare to people who make jobs. Blaming the Democrats for your lack of a serious budget might make you feel better but it won’t win you any elections. It won’t because you need moderates like me to win elections. To many of us, your budget is less serious, certainly not fair and more of a political hack-job designed to score ideological points. Apparently I am not the only one who feels this way. The moderates in New York’s 26th are not buying what you are selling either.
6 Responses to “Right-Wing Social Engineering”
DR,
Couple of questions…
1. When you refer to the tax cut in the Ryan budget are you referring to (a) the failure to increase tax rates in 2013 as current law calls for; (b) the reduction in marginal rates (combined with elimination of deductions and credits); or (c) both of the above?
Let me offer you a perspective. The tax reduction in (a) is typically broken into two parts — for those above your income (as described) and for those below. The cost of the reduction for those above your income (aka the rich) is approximately $50 billion in foregone revenue. The cost for the rest (aka you) is about $250 billion. So in (a), it would be helpful to clarify which you are talking about.
As for (b); the cut in tax receipts projected in the Ryan budget is about .5% of GDP (from the CBO adjusted baseline which assumes that only the top two brackets go up and the AMT continues to be patched). Said differently, unless you are arguing that ALL of the tax rates should be increased, the amount of “tax cuts” even assuming your definition is (c) above; is between $50 and $70 billion.
For context, Medicare is projected to cost $468 billion. At roughly 4% inflation, that $50 to $70 billion is buying you between 2 and 3 years of inflation.
2. What alternative would you propose or do you support?
Personally, I’m quite happy with the Bowles-Simpson budget but for the fact that it punted on Medicare. That needs to be changed but other than that, it’s quite a good budget. The argument from my pov against Democrats is that they refuse to put forward a budget at all. Maybe that doesn’t sway your vote but it’s another way of saying that their budget is effectively what the President submitted. If you prefer that budget, that’s fine but then you should be planning for dollar devaluation and the resulting inflation as well.
3. Railing against Republicans is all well and good (particularly on TMV) but it doesn’t actually make anything better. When you’re on a downward path, isn’t it better to discuss alternative solutions as opposed to whining about politics?
Happy Memorial Day
The current entitlement programs have long been known to be unsustainable, and when they start, and as they, run deficits, the money will have to be found elsewhere in the budget to pay the benefits in full, as the Trustees of these programs have tried year after year to tell the public. Surely all liberals are not among the many so ignorant of these long-known issues, and the insane who insist that nothing be done to these programs, especially raising the retirement age or reducing total payouts to beneficiaries over the long run. We await those rare exceptions.
Steve,
Thank you for your well reasoned response. Your point is well taken regarding the remaining difference between the actual cost of Medicare and the tax expirations/reductions for the rich and myself. I guess I am choosing “c”. Rich was probably not the best use of words. Additionally, I understand to get the 250 billion I would have to give up things like the “marriage penalty” and risk the “Alternative Minimum Tax.”
I Too like Simpson/Bowles and was dismayed by the lack of attention on entitlements.
Were I made king for a day; I would like to use the tax “flattening” of the Simpson/Bowles. Although, I would lose the mortgage deduction, it just seems fairer.
Where I respectfully disagree is the principle of the matter. I agree political gamesmanship has no place in this debate (my ranting included) however, I feel breaking the social contract (Medicare) with millions of Americans should require exhausting all other avenues. It should require this because I am not sure, at this late date, I (and others) can make the adjustment financially to pay from 6 to 12 thousand (depends on who you talk to) a year from date of retirement until my wife and I expire. I guess in the final analysis, the Ryan budget nor the GOP negotiation preconditions represented a good faith effort to actually fix the problem in my POV (or the voters of the 26th). Then on Sunday, they inferred anyone who did not agree with them were somehow un-American or un-informed. It seems Eric Cantor, Mitch McConnell, Paul Ryan and others need the lecture on what may be productive in this debate.
Throw Bowles-Simpson from the train, or you can’t handle the truth. Exaggerated, but basically true of the Dems currently in power.
Not much better are the: we are the superior brains, or you (except for B. Clinton) don’t understand the math.
D.R
Thanks for a thoughtful reply. My only addendum is we need to control cost inflation in Medicare period. It doesn’t matter what else we do on the revenue side. Said differently, we will need to change the social compact in some way, no matter what.
I’d also note a general tendency to apply the words “social compact” only to the benefits offered, never to the taxes required to pay for those benefits. Medicare and SS taxes have been raised multiple times to preserve the social compact and it still isn’t enough. I only wish those who worry about the contract would realize that changing the rules on either side of the ledger is an equal violation of the preexisting contract.
I agree with you BTW on the mortgage interest deduction although I think it would have to be phased out rather than eliminated, just my pov.
More broadly however, we need to recognize that giving money or services to the wealthy because they happen to be elderly does neither the country nor the actually needy any good.
Did anyone notice, the Ryan plan includes much needed means testing.
http://www.budget.house.gov/UploadedFiles/PathToProsperityFY2012.pdf
I don’t know where to find the Dems plan, for comparison, or is it the current budget plan?