The progressive path
This month, House Budget Committee Chairman Paul Ryan released his “Path to Prosperity,” or proposed federal budget for fiscal year 2012, to much fanfare and media crooning. Largely lost in the partisan shuffle that ensued are three crucial points about the proposal: it does not meaningfully cut the deficit for decades, many factual assertions in the plan are based on a shockingly disingenuous report by the Heritage Foundation, and the Ryan’s budget would all but eliminate the historical guarantee of health care access in old age.
Paul Ryan has earned an almost legendary reputation in the American media as a truth-teller and deficit-slayer. However, analysis by the nonpartisan Congressional Budget Office found the plan’s impact on the deficit to be tepid at best for the next quarter century. Contrary to the way Ryan’s Path has been presented, the plan does not impart substantial deficit reduction until well after 2040. In fact, debt held by the public actually increases under Ryan’s plan from 69 percent of GDP in 2020 to 99 percent in 2040. It is impossible to imagine what challenges America will be facing in 2040, 29 years from now, or what will have transpired in the interim.
Equally worrying is a Heritage Foundation report that formed the basis for many factual assertions in the Path to Prosperity. Among them is the claim that the plan “creates nearly 1 million new private sector jobs next year [and will] bring the unemployment rate down to 4 percent in 2015.” Unfortunately, the very same study concluded that unemployment would be reduced to 2.8 percent by 2021. As a point of comparison, the CBO recently chided the Obama administration for a report that placed unemployment in 2015 at 5.3 percent, while the Federal Reserve estimated the long-run-unemployment rate at 5-6 percent. It is difficult to take many of the rosy assertions of Ryan’s plan at face value after such intellectually dishonest claims.
Setting aside technical peculiarities and distortions, the Ryan budget is frighteningly clear about what it intends for the federal government—near elimination. Currently, the government accounts for about 25 percent of GDP. Ryan’s plan cuts spending to 14.75 percent of GDP by 2050. The last time spending represented 14.75 percent of GDP was 1951, before Medicare and Medicaid even existed. The Path to Prosperity also cuts discretionary spending in half, from 12 percent of GDP to 6 percent. The Congressional Budget Office reports that “spending in this category has exceeded 8 percent of GDP in every year since World War II.”
Ryan is able to make such catastrophic cuts by taking the axe to the programs that help people who need it most: children, the poor, and the elderly. First, the Path to Prosperity essentially dismantles Medicare by turning the program into a voucher system. The vouchers don’t apply until 2022—so that the Path to Prosperity doesn’t become a political liability among today’s seniors, who would strongly oppose any cuts to their Medicare—and would more than double out-of-pocket costs, according to the Center on Budget and Policy Priorities. Unsurprisingly, the Path to Prosperity also repeals the Affordable Care Act, including even the cost-saving measures like the Independent Payment Advisory Board, which is supposed to provide a check against unnecessary and expensive procedures. Additionally, the Path to Prosperity turns the Supplemental Nutrition Assistance Program, or federal food stamps, into a block grant, and then cuts funding for the program by 20 percent. Since 86 percent of SNAP recipients are below the poverty line, and 44 percent of recipients make under half of the poverty line, “deep SNAP cuts would likely cause more families and individuals to fall into poverty and deep poverty,” according to the Center on Budget and Policy Priorities.
The left needs to challenge the bizarre and unfounded notion that Paul’s reactionary proposal is somehow “courageous” and “necessary.” Ryan and his ilk have changed the goalposts of this debate, and President Obama has let them. Nonetheless, in a rare moment of force, Obama said in his debt speech on April 18: “We recognize that no matter how responsibly we live our lives, hard times or bad luck, a crippling illness or a layoff, may strike any one of us … And so we contribute to programs like Medicare and Social Security … unemployment insurance … and Medicaid …. We are a better country because of these commitments.” Obama’s rhetoric was encouraging, but we need to hold the President and his party to these promises. Our political system requires compromise. But when Democrats start from the center and Republicans start firmly and comfortably on the right, we have lost the chance to frame the debate, and we run the risk of conceding our deepest values.