24th
2012: The Medicare Election
Both parties have problems with their arguments
By Matthew Alexander
The 2012 election is still 18 months away but some of its themes have already started to take root; Indeed it seems increasingly likely that the 2012 election will be fought over entitlement reform, and specifically - Medicare.
The Republican plan put forward by Rep. Paul Ryan (R-Wis.) would make drastic changes to the current Medicare program, though no one 55 and older as of this writing would be affected.
However, the independent CBO has weighed in, saying that seniors starting in 2022 will end up paying more under Ryan’s “voucher” (yes, I know Republicans don’t like that term) proposal than under the current system.
Most public polling I’ve seen (with the important exception of the New York Times/CBS poll) shows that the public are against the Ryan proposal - though I would strongly caution that the poll’s wording is absolutely critical in determining voter sentiment.
Also let’s face it, most people aren’t well-versed enough in the details to offer an informed response. At this stage, polling is more likely an indication of party ID than support for a particular plan.
Let’s be honest though. Politically speaking, the Democrats unquestionably have the stronger hand here.
Shouldn’t we expect to see the Republicans’ plan get pummeled by Democrats much in the same way that they whipped Democrats over health care in the 2010 cycle?
Well… Not exactly. Democrats should ask themselves this: If they have such a persuasive argument, then why do they feel the need to embellish the facts in Ryan’s plan?
I see you cynics rolling your eyes, “Both sides Lie!” Yes they do. Yes, they do.
But Bill Maher and the DCCC have now both been accused of distorting/lying about Paul Ryan’s plan by Politifact - the independent political fact-checking website.
If Democrats have enough political support to win this fight on the merits, then why resort to scare tactics and baseless attacks on Ryan’s plan?
Notice that Republicans are very quick to say that their plan begins in 2022 and doesn’t affect current seniors, which begs the obvious question: If their plan was so great and benefited seniors, then why not adopt it sooner? The GOP response to that is that a 10 year period is needed to give future seniors time to prepare for the switch. But, clearly there are other issues at play here too. The 55+ exception by Republicans is clearly a short-term political dodge.
DEBUNKING DEMOCRATIC MYTHS
However, Democrats need to face up to some cold realities too.
No Democrats, the Ryan plan does NOT give seniors a $15K check and tell them to fend for themselves. The poor and sick are given more money than those at the top of the scale.
However, Ryan’s plan would seem to result in seniors having to pay more for their health care costs over the long run. If that’s the simple truth, then why don’t Democrats stick to that argument, bang it like a drum and take their chances at the polls?
Now in defense of Ryan - He says that his plan would result in increased competition among private insurers, thereby driving down seniors’ costs. Is there an argument to be made there? Maybe. I confess to being skeptical. But how is one to know? In a world of spin and no truly independent arbiters, I’ll take the CBO at its word on this point and accept the fact that future seniors would pay more out of pocket under Ryan’s plan.
Another defense of Ryan - He’s put the issue on the table which took a lot of political courage and he should be praised for that.
The Democratic argument that goes, “How can a plan be called courageous if it guts seniors’ rights, hurts the poor etc etc..” is unfair as
a) it IS politically courageous to put forward a plan likely to be opposed by an important voting bloc and
b) despite what it does or doesn’t do to seniors, the CBO does believe Ryan’s plan will lead to government paying less. i.e. It IS a serious long-term deficit reduction plan.
The most persuasive Republican argument at this point remains the fact that the status quo can’t continue and Ryan’s plan is one way of addressing our debt. Oh, and that Democrats don’t have a credible alternative. As Ryan correctly states - the real argument should not be about his plan versus the status quo but between his plan and a yet-to-be-formed Democratic alternative. Indeed, Democrats used this same line when arguing for universal health care during the 111th Congress.
(BTW - my position on ObamaCare: While I favor the pre-existing conditions language and the 26 yr olds on parents’ plans parts, I do NOT believe the numbers add up and am not someone who advances the CBO report saying it reduces the deficit. If you’re covering 30M more people, then SURELY that must cost more money, not less, right? N.B. - Bill Maher is another who acknowledges this)
SO WHERE DO WE GO FROM HERE?
No doubt everyone wants to protect seniors, but the country also needs to face its looming debt burden as the national debt continues to rise as an alarming percentage of GDP.
Clearly choices are going to have to be made. The music’s stopping. If Democrats are serious about the debt (which they claim to be), then they should argue against changes to the current Medicare system by refocusing the debate as a whole on to spending priorities and revenue collection.
Democrats should argue that of all the people who to have to bear a heavier burden, seniors - who for the most part rely on fixed incomes - should be the last ones forced to sacrifice.
Defense anyone? How about taxes?
Still, if Democrats are going to convince with this argument, then they will have to be willing to propose other spending cuts and increased sources of revenue (and yes, I’m talking about being courageous on the need for tax hikes on ALL income brackets).
Obama has committed (again) to his 2008 campaign pledge of tax hikes for those making over 250K. Meanwhile, Pelosi has (unhelpfully) floated the idea of raising the 250K threshold to 1 million. Either way, Democrats showed no backbone in the last tax showdown which resulted in both parties agreeing to extend the Bush tax cuts at the expense of the deficit. No courage was shown by either party. Free ice-cream for all!
STALEMATE
When Standard and Poor’s changed the US debt outlook to negative, it did so on the premise that it believed that the two parties would be unable to come to any political agreement in the next 2 years and therefore the United States debt would inevitably rise in at least the short-term.
Meanwhile, while announcing its own decision not to change the country’s debt outlook, Moody’s cited its belief that the two parties will in fact come to an agreement to pay down the county’s long-term debt.
Who is right? Having seen the tax compromise during the lame duck congress — an agreement that required no sacrifice from anyone as it extending all tax cuts to all income groups in addition to a temporary payroll tax cut — my bet’s on S&P.
If I was betting man, I’d say that Democrats will win the political argument but no tangible progress towards addressing the debt will result and Obama will win re-election somewhat comfortably in 2012.
#1 The Democrats’ position, though far from courageous, is a winner at the polls
#2 Paul Ryan is explaining. He is therefore losing.
The Democratic argument that will win Obama re-election is simple: Make no changes to Medicare, Medicaid and Social Security while agreeing to smaller cuts in discretionary spending, including defense and raise taxes on those making more than $250K a year. Oh yeah and close some tax loopholes too.
On Ryan’s plan, Democrats will say that he cuts Medicare and other vital programs in order to finance a huge tax cut for people who don’t really need it. Because that’s one point that Republicans don’t want to defend but should be forced to.
An effective criticism of Republicans — that their refusal to put taxes on the table shows an inherent lack of seriousness about the deficit reform they claim to cherish so much — has already been summed up rather well by The New Republic’s Jonathan Chait.
“The standard GOP approach to budget debates for twenty years has been to vigorously isolate debates about taxes and debates about spending,” Chait writes. “If presented with a question that ties together debates about taxes and spending, Republicans will automatically deny the premise, and recontextualize taxes as a question of economic growth or abstract fairness. The two can never be discussed in tandem, because doing so clarifies a choice Republicans need to obscure.”
CONCLUSION
Republicans presently have a more serious and courageous plan for long-term deficit reduction on the table than Democrats. However, their refusal to consider meaningful tax increases and even, advocacy of lower tax rates for the rich, shows that they are far from making the really tough choices.
Democrats have a winning hand politically and will likely take it to the polls with the eye more on winning than on seriously addressing the nation’s long term fiscal imbalance.
