Ryan Deficit Plan is a Cruel Hoax

Uses deficit as a cover for stunning unfairness and irresponsibility

The Claim: Paul Ryan claims that shifting massive new health care costs onto seniors, persons with disabilities, and low income Americans, and slashing investments that increase opportunity and freedom for most Americans, is necessary to balance the budget and tackle the national debt.

Values Message: Ryan’s plan is not a deficit reduction plan at all...

it is a cover to implement an extreme agenda that would leave many Americans on their own.  Ryan irresponsibly gives massive new tax breaks to the wealthiest Americans even larger than the Bush era tax breaks, making a tax system that is already rigged against middle class and low income Americans even more unfair.  A responsible deficit plan would ask the wealthy to pay their fair share, and would protect investments which create the opportunity for more Americans to get ahead during their working years and to enjoy secure retirements.  Ryan also undermines efforts to restrain health care hyperinflation, unfairly shifting the cost of a bloated health care system onto average Americans who can’t afford it.  Equally shocking, the damage Ryan’s plan will do to freedom and opportunity will probably never lead to a balanced federal budget.  In a classic bait and switch,  Ryan’s tax cuts for the rich and many of his draconian cuts begin immediately, but the plan takes 28 years to produce its first balanced budget, and even this false promise is based on fuzzy and completely implausible assumptions.

Proof Points:
(1)  Ryan’s budget may be the largest redistribution of income to the wealthy in American history.  While imposing savage cuts on investments that increase opportunity and freedom for middle class and low income Americans, Ryan budget would give millionaires a $265,000 a year tax cut on top of the $129,000 they got from Bush era tax cuts, increasing their average income by 12.5% (Source: Center on Budget and Policy Priorities).

(2) Ryan’s budget is not serious about deficit reduction.   Ryan’s plan contains $4.3 trillion in tax cuts for the wealthy and only $1.7 trillion in specific spending cuts, which is not a serious path to reducing the national debt.  Ryan’s plan does not begin to reduce the deficit for 20 years and does not run a surplus until 2040. No serious deficit plan would kick the can down the road 20 years to future politicians, who Ryan cannot plausibly hold to implementing his massive cuts to vital investments.  (Sources:Center on Budget and Policy Priorities, Families USA, Paul Krugman)

(3) Ryan’s plan to voucherize Medicare actually increases cost. The cost of Medicare is increased by 40% per recipient over traditional Medicare, shifting massive new costs to seniors which go to the health insurance industry and to medical providers. Of the $6,350 extra each senior pays in Ryan’s Medicare scheme, only $600 goes to deficit reduction. (Sources: Center on Budget and Policy Priorities, Peter Orszag)

(4) Ryan’s budget makes absurd and unrealistic assumptions about future spending which should not be taken seriously. According to the Congressional Budget Office, the nonpartisan referee on federal budgeting, Ryan’s plan assumes that there will be no federal spending on anything other than defense, Social Security, Medicare, and Medicaid by 2050.  That would mean no spending on medical research, roads, bridges, education, food and water safety, air safety, national parks, border patrol, agriculture, or assistance to the poor.   This is both highly implausible and would be ruinous to the nation if it ever did take place.  In addition, Ryan’s numbers don’t even add up. He assumes that all federal discretionary spending can be reduced to 3% of Gross Domestic Product (GDP) when defense spending alone is now 4.8% of GDP. Ryan calls for increased defense spending, further demonstrating the complete absurdity of his projections. (Sources: Center on Budget and Policy Priorities, Jacob Weisberg, Paul Krugman).

(5) By repealing the Affordable Care Act, Ryan also repeals reforms that over time can reduce health care hyperinflation.  Ryan demagogues against payment reform, falsely labeling cost savings as rationing, when the law forbids rationing.  A new report from the highly respected Institute of Medicine concludes that one-third of U.S. medical spending is waste which does not improve health outcomes.  There is plenty of fat in the bloated American health care system without denying needed care, but Ryan undermines all of these potential savings, preferring to shift costs to seniors, low income Americans, and the middle class (Sources: Center on Budget and Policy Priorities, James Fallows, Institute of Medicine).

(6) Ryan’s plan makes completely implausible assumptions about increased revenue from changing  the tax structure, and assume eliminating popular tax deductions that he refuses to specify (Source: Center on Budget and Policy Priorities)

Quotation:  “The new Ryan budget is a remarkable document — one that, for most of the past half-century, would have been outside the bounds of mainstream discussion due to its extreme nature. In essence, this budget is Robin Hood in reverse — on steroids.  It would likely produce the largest redistribution of income from the bottom to the top in modern U.S. history and likely increase poverty and inequality more than any other budget in recent times (and possibly in the nation’s history).”   Robert Greenstein.

For more information go Citzen Action of Wisconsin’s dedicated helath care reform website www.gothealthcarewi.com