Battle of the Budget Bulge

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As for entitlements, Ryan’s plan offers some welcome reform, coupled with hard truths. In his Journal editorial he explains why. “Absent reform, government programs designed in the middle of the 20th century cannot fulfill their promises in the 21st century,” he writes. “It is a mathematical and demographic impossibility. And we said so.” Thus, he proposes turning major social programs currently controlled by the federal government over to state control, and re-introduces a deadline for people getting off the dole.

And once again, Ryan wades into the Medicaid battle, where he takes his greatest risk in a nation grown quite accustomed to entitlement programs irrespective of fiscal reality. First, he is proposing no changes for anyone 55 years of age or older, but again has proposed a cap on spending for future retirees, who would get a set amount of money to purchase health insurance from health plans he envisions competing against each other “to achieve high-quality coverage at the lowest cost.” Ryan also contends that introducing competitive bidding to government’s financial contribution to Medicare will bring overall health costs down. And he answers his critics who claim he wants to end “Medicare as we know it” by retaining a “traditional fee-for-service Medicare option” in his new plan–but it would cost seniors more money to support it if private plans could be purchased more cheaply.

Naturally, Democrats were completely against it, and the class-warfare motif that has become an integral fallback position for the party was swiftly employed. “The House budget once again fails the test of balance, fairness, and shared responsibility,” said White House Communications Director Dan Pfeiffer in a statement. “It would shower the wealthiest few Americans with an average tax cut of at least $150,000, while preserving taxpayer giveaways to oil companies and breaks for Wall Street hedge fund managers. What’s worse is that all of these tax breaks would be paid for by undermining Medicare.”

Former House Speaker Nancy Pelosi (D-CA) was equally predictable. “The Republican proposal would end the Medicare guarantee, shift costs to seniors, and let Medicare wither on the vine, while providing billions in tax breaks for Big Oil and special interests, and destroying American jobs,” said her released statement.

Yet Ryan has an unlikely (perhaps unwitting is more accurate) ally. After the president presented his budget back in February, Treasury Secretary Timothy Geithner appeared before the Senate and House budget committees. At the Senate hearing Mr. Geithner admitted that “even if Congress were to enact [the president's] budget, we would still be left with, in the outer decades as millions of Americans retire, what are still unsustainable commitments in Medicare and Medicaid.” He did no better in the other chamber, telling a House Budget Committee on February 16th that president Obama’s 2013 budget would “put the U.S. on an unsustainable course” if enacted. “We have millions of Americans retiring every day, and that will drive substantially the rate of growth of health care costs,” offered Geithner. “You are right to say we’re not coming before you today to say we have a definitive solution to that long-term problem.”

Mr. Geithner then illuminated the current zeitgeist that dominates the Democrat party. “What we do know is, we don’t like yours,” he added, referring to Paul Ryan’s previous attempt to steer the nation away from fiscal Armageddon. When Americans consider such intransigence, coupled with an utter lack of serious ideas for solving the nation’s fiscal problems–as well as remembering the Senate’s steadfast refusal to enact any budget whatsoever–they may be forced to reconsider who the real “Party of No” is in the ongoing budget standoff.

Mr. Ryan sums up the essential difference between the parties. “The president’s budget gives more power to unelected bureaucrats, takes more from hard-working taxpayers to fuel the expansion of government, and commits our nation to a future of debt and decline,” he writes. Absent a “definitive solution” for what are “unsustainable commitments in Medicare and Medicaid,” according to the Treasury secretary.

Which party will prevail next November?  The answer to that question undoubtedly centers around entitlements. That reality engenders a far deeper question about the relationship between Americans and their government. Do they prefer being talked to like adults and dealing with the fact that the current system is completely unsustainable no matter how high they raise taxes, or will they continue to be seduced by the siren song of endless entitlements paid for by “somebody else”?

Such is the essence of the 2012 election.

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  • hajida

    Another FP article discussed about 6 major cities which are ruled by the Democrates for decades and are now deep in finacial crisis. This indicates the ideas of fairness of the Democrates results in equal poverty.

    “The House budget once again fails the test of balance, fairness, and shared responsibility,” Where does it fail the test of balance when the deficits can be lowered by Mr. Ryan's proposal? Where does it failed the test of fairness when it doesn't require hard working people to support people who are able but don't want to work? And where doest it fail the test of responsibility when it allows all responsible citizens to take a share of reducing the debt?

    While talking about fairness, why does the congress made a law that punishes insider trading for others but allowed themselves to be exampted from that law?