Tag: paul ryan

Will Americans Bite the Bullet — and Vote for Individual Choice?

Today POLITICO Arena asks:

Rep. Paul Ryan, architect of House Republicans’ budget plan, has faced a series of angry questions at town hall meetings, thanks in part to groups like the Democratic National Committee and the progressive activist group Americans United for Change. Can they use town halls to turn public opinion against the budget plan, as happened with Democrats’ health care proposals in summer 2009? And is the fury organic or mostly manufactured?

My response:

Unlike the fierce Tea Party reaction to Obama’s health care scheme in the summer of 2009, which came spontaneously from the bottom up and continued through November 2010, the angry reaction at the moment to the House Republicans’ budget plan is largely manufactured by the Democratic left and is not likely to last — or, if it does, we’re in more trouble than we imagine. What the 2010 elections demonstrated was the ability of the American people to discern change they could not believe in, and to do something about it. One hopes they’ll see enough change in the Ryan plan that they can believe in.

Take, for example, Ryan’s proposal to change Medicare from a “defined benefit” to a “defined contribution” plan, which has generated the most early opposition. The bottom line here is really quite simple. The CBO projects that Congress would have to double all federal income-tax rates to keep Medicare and other entitlements on their current path. That would cripple the economy — and itself end Medicare as we know it, and much else besides — so Congress must reduce Medicare spending growth.

The basic question, therefore, is whether bureaucrats decide what health care seniors receive (the Democratic method) or seniors themselves decide which benefits are most valuable to them (the Ryan plan). Will more Americans prefer to have their health care rationed by others, or by themselves? We shall see.

Monday Links

  • “Sadly, in Egypt’s case, a freely elected civilian government may prove powerless in the face of the deeply entrenched and well-organized military.”
  • “Washington politicians from both parties, and bureaucrats, have for decades successfully decreased our freedom and liberties as they have regulated more and more of our lives, including our retirement.”
  • “The Ryan proposal correctly focuses on achieving debt reduction through spending cuts, but this very gradual debt reduction schedule is a weakness that could lead to its downfall.”
  • “Nearly two years ago Sen. McCain, along with Senators Graham and Lieberman, was supping with Qaddafi in Tripoli, discussing the possibility of Washington providing military aid.”
  • Cato media fellow Radley Balko joined FOX Business Network’s Stossel recently to discuss your right to make video recordings of police, and why exercising that right frequently is vital to liberty:

Thursday Links

No Profile in Courage Here, Either

Yesterday, speaking at Facebook headquarters, President Obama assessed the guts of Rep. Paul Ryan (R-Wisc.) and other congressional Republicans and concluded that their deficit reduction plan isn’t “particularly courageous.” That might be accurate – their plan lacks specificity and could target a lot more for elimination – but it’s pretty rich for the President to throw out such a conclusion. After all, his whole strategy appears to be the bankruptingly lame-but-safe crying of doom for cute kids and other supposedly defenseless people no matter what the size of the proposed cut to a social program or how ineffective the program has been. That, and the constant lamentation that “the rich” – a small and therefore electorally weak group of voters – don’t pay their fair share. (And the constitutionality of federal programs? That doesn’t even get a mention.)

Representative of this cowardly course is the President’s mantra about “investing” more in education-related programs despite blaring evidence that the programs don’t work or, as is the case with federal student aid, actually make the problem they’re supposed to solve much worse. But the President wants votes – like most politicians, he wants lots of people to think he’s giving them great stuff for free – so he’s not doing the mildly courageous thing and telling people “look, these programs don’t work, we have a titanic debt, and I’m going to cut things that might sound good but aren’t.” No, he’s doing things like going to community colleges and, in front of cheering groups of students, talking about mean Republicans and how he wants to protect students just like them by keeping the federal dollars flowing.

That’s no profile in courage, nor is it a responsible way to deal with the federal government’s gigantic problems.

Thursday Links

No, Paul Ryan Really Doesn’t Cut Pentagon Spending

Last week I expressed my disappointment with Paul Ryan’s budget plan, specifically about his unwillingness to cut military spending. Some people think that he does cut spending through his acceptance of Secretary Gates’s $78 in “cuts.” (see, for example, Sen. John Sununu; Sen. Joseph Lieberman, AEI’s Gary Schmitt and Tom Donnelly; and the Heritage Foundation’s Baker Spring).

So either I am wrong, or they are. Let me try to set the record straight.

First, all of Ryan’s other savings – savings which I support – were projected either against the Obama administration’s FY 2012 budget or against the current budget baseline. For example, according to Ryan’s own “Key Facts” his plan “Cuts $6.2 trillion in government spending over the next decade compared to the President’s budget, and $5.8 trillion relative to the current-policy baseline.” With respect to military spending, however, Ryan’s plan basically follows the Obama/Gates budget, proposing to spend a staggering $670.9 billion in FY 2012. The Obama administration’s DoD budget request for FY 2012 – including the Pentagon’s base budget plus overseas contingency operations (OCO) – totals $670.9 billion as well.  Of course, that total leaves out national defense spending tucked away in other departments (including nuclear weapons spending in the Department of Energy). Total national defense spending in FY 2012 will top $700 billion. I stand by my earlier assertion that the Pentagon’s budget escapes from Ryan’s budget axe “essentially unscathed.”

Ryan and others claim that military spending has already been cut, hence the decision to embrace this portion of the president’s budget. Sen. Lieberman explained to Bloomberg news, “To a certain extent, Secretary Gates has enabled us at least temporarily to take defense off the table because he has initiated his own round of defense cuts.”

“To a certain extent” is doing a lot of work in that statement. In fact, Gates and Obama do not cut military spending.

First, they don’t claim to do so. These supposed cuts are only “cuts” in Washington-speak. The Pentagon’s base budget under both the Ryan and Obama plans will increase 1 percent in real, inflation-adjusted terms. See the table below, recreated by my colleague Charles Zakaib from the official DoD budget request.

Second, Ryan claims that Gates’s “exhaustive review of the Pentagon’s budget” identified $178 billion in savings. It does nothing of the sort. By Ryan’s own admission, taxpayers will see only $78 billion of these; the other $100 billion are to be “reinvested” elsewhere in the Pentagon. (They’re always “investments” when you’re spending the taxpayers’ money, even when Republicans do it.)

So we’re really talking about $78 billion toward deficit reduction over the next five years, or approximately 2.6 percent of the Pentagon’s base budget (excluding the wars) over that same period. With all due respect, that isn’t a bold plan for reducing the crushing burden of spending and debt; that’s a rounding error.

What’s more, it is highly unlikely that these savings will materialize. Many of these efficiencies involve consolidation of commands – something that Congress has already balked at – and unspecified savings that are relatively easy to identify, but extremely difficult to implement.

But if, by some miracle, Robert Gates’s successor(s) manage to get them passed by Congress, those savings won’t actually be dedicated to deficit reduction: they will be completely devoured by spending on the wars. This is the greatest sham of all. Charles Knight at the Project on Defense Alternatives (and a key contributor to the Sustainable Defense Task Force, of which I was also a member) explains:

For several years now White House budget projections have included a “placeholder for outyear overseas contingency operations” most of which are accounted for by the wars in Iraq and Afghanistan. This placeholder number has been and remains $50 billion. Every year actual OCO (overseas contingency operations) spending turns out to be several times that number. FY11′s OCO is $159 billion and FY12′s is $118 billion.

Adjusting for the effect of the new OCO for FY12, the $68 billion budgeted above the placeholder of $50 billion eats up most of the $78 billion in Pentagon cuts that Secretary Gates offered up in January to fiscal responsibility….The remaining $8 billion (and much more) will go to the war budgets when reality collides with placeholder projections.

On 14 February Pentagon Comptroller Hale confirmed that the $50 billion placeholders for FY13 and beyond was the “best we can do.” Others make an attempt to be more realistic. The high tech industry association called Tech America annually projects DoD budgets for ten years out. In their 2010 projection they estimate that OCO spending will be $102 billion in FY13, $69 billion in FY14 and $57 billion in FY15. When we subtract the $50 billion placeholder for each of those years and total the remainder we find that the Pentagon is likely to spend $78 billion more in the years FY13 through FY15 than in the White House budget projections.

I hope that I’m proved wrong. I hope that the wars in Iraq and Afghanistan are brought to a close. I hope that the Congress gets serious about tackling Pentagon waste, and stops treating the military budget as an elaborate jobs program. I hope that our brave men and women in uniform get the hardware, equipment, and training that they need, and that Americans get the “defense budget” that they deserve. But if past history is any guide, the Pentagon’s budget will continue to climb, other countries around the world will continue to free ride on Uncle Sam’s largesse, and U.S. taxpayers will be left to foot the bill.

When Too Much Money’s the Problem…

Last Friday’s PBS NewsHour included a debate between NYT columnist David Brooks and WaPo columnist Ruth Marcus on the budget fights on Capitol Hill. Marcus was sitting in for NewsHour regular Mark Shields, whose comments I find thoughtful and worth contemplating. Unfortunately, on Friday Marcus didn’t meet Shield’s standard.

In discussing House Budget Committee chair Paul Ryan’s proposal that Medicaid be converted to a block grant program with the states taking a broader administrative role, Marcus offers:

RUTH MARCUS: The cuts in here are so dramatic. They are so painful. And they — and many of them are focused — I know this is not his intention, but he turns, for example, Medicaid, which is the health-care program for poor people, into a block grant. You give it to states.

But then it just doesn’t grow enough to deal with the increase in health-care costs. Well, what happens to these people?

Is she serious!?

Marcus seems not to understand that government subsidies to health care consumption, in the form of such programs as Medicare and Medicaid as well as employer tax exclusions for health insurance benefits, contribute to the rapid growth in health care costs. That is, by flooding the health care market with government money, the market ends up with many dollars chasing few worthwhile health care products, which results in rising health care prices. Moreover, the subsidies siphon away health care resources from the private-payer health care market, causing cost in that sector to increase rapidly as well.

Subsidies aren’t the only government policies contributing to rising health care costs. Government restrictions on the supply of health care services also play a role. Among those supply restrictions are the ban on drug importation, a very costly and difficult new-drug testing regime, and unnecessarily restrictive licensing of health care professionals.

The rapid rise in health care costs is primarily the consequence of government policies. For Marcus to say that we should maintain the current subsidy system for health care because, without it, Medicaid patients won’t be able to keep up with health care cost increases is … well … not very good commentary.