Paul Ryan's Plan: The GOP Budget And The 2012 Race

House Budget Committee Chairman Paul Ryan unveiled a budget Tuesday that would slash federal spending by $5 trillion more than the budget President Barack Obama released last month, in large part through sweeping cuts to safety net programs.

As HuffPost's Michael McAuliff reported, Ryan's budget will never become law because Senate Democrats will not take it up. But the "Path to Prosperity," as the plan is called, draws a sharp contrast with Obama's budget and may put GOP candidates in the delicate position of siding with or against provisions of what is essentially a political document. Ryan (R-Wis.) insisted his plan won't hurt them.

Here are the basics of the Ryan budget to look out for on the campaign trail:

1. Medicare

Ryan's budget would cut Medicare by $205 billion compared to Obama's budget and would repeal the health care reform law. Seniors would have the option of switching to a government-financed “premium support” system that would allow them to buy private insurance on the open market. The government would be left to cover the sick who were rejected by private insurers. ThinkProgress reports:

The budget states that enrollees would be "guaranteed a plan that is at least the value of the traditional fee-for-service Medicare option," but private insurers could still attract a healthier population by simply ratcheting down services that sicker beneficiaries rely on (like chemotherapy) and building up coverage for healthier applicants (like preventive services). Should they succeed, traditional Medicare costs will skyrocket, forcing even more seniors out of the government program.

2. Medicaid

The Republican blueprint calls for $770 billion in cuts to Medicaid, which would be converted to a block grant program run at the state level. Medicaid is currently a matching program, which means that states receive federal funds when they add more recipients. Ryan proposes controlling costs by sending the funds for both Medicaid and food stamps as block grants and giving the states discretion over how to spend the funds -- in a provision he described as "welfare reform, round 2."

"We don't want to turn the safety net into a hammock that lulls able-bodied people ... into complacency and dependence," he said Tuesday.

3. Health Care Reform

Ryan wants to repeal President Obama's health care reform law, which he says would save $1.6 trillion.

But repealing the law would mean reinstating some $455 billion in Medicare funding, including $132 billion for Medicare Advantage companies, many of which have a history of billing the government for far more than they paid out and duping seniors into signing up for bogus services. And the Ryan plan would slash subsidies designed to help people fulfill the Affordable Care Act's requirement to purchase health insurance coverage and would leave millions of Americans uninsured. Because the Ryan budget offers no plan to control medical costs or insurance premiums, the government's health care savings would come at the expense of individuals.

4. Tax Reform

The Ryan budget would lower the top individual income tax rate from 35 percent to 25 percent. It would set just two income tax rates of 10 percent and 25 percent and a corporate rate of 25 percent. Ryan argued that the plan would be "revenue neutral" and make up for tax cuts by eliminating many deductions and loopholes.

His plan would result in $3 trillion in tax cuts for the wealthy and corporations.

5. Defense Spending

Under Ryan's budget, some of the savings from deep cuts in entitlement programs would be funneled into military spending. ThinkProgress reports:

The Ryan budget protects defense spending from automatic cuts agreed to in last year's debt deal, then boosts defense spending to $554 billion in 2013 -- $8 billion more than agreed upon in the deal. At the same time, it asks six Congressional committees to find $261 billion in cuts. That includes $33.2 billion from the Agriculture Committee, meaning food stamps and other social safety net programs are likely to face cuts, all while the Pentagon remains untouched.

Released the day of the Illinois Republican primary, Ryan's budget has already become a political lightening rod. Democrats put a mocking video online before the budget was even released. Ryan has not endorsed any of the GOP presidential candidates, but he consulted with each of them before releasing the budget, according to The Hill.

"I have spoken to all of these guys, and they believe we are going in the right direction," Ryan said.

Newt Gingrich, who slammed Ryan's "radical" budget as a piece of "right-wing social engineering" last year, has already embraced the election-year version of the plan as "courageous." Mitt Romney, Rick Santorum and Ron Paul did not immediately comment.

Here is what the GOP candidates had to say about Ryan's budget last year:

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Mitt Romney

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Former Massachusetts Gov. Mitt Romney has exercised caution in communicating his position on Ryan's proposal. While he has signaled support for the objectives it seeks to accomplish, the presidential candidate has said he intends to put forth his own plan for entitlement reform. "If we don't make any changes, then Medicare won't be there for the next generation and that's unacceptable to me. So I appreciate what Paul Ryan has done," Romney said during a stop in Iowa. "I'm going to have my own plan." When asked specifically if he would endorse Ryan's proposal if elected president, Romney dodged the question. "That's the kind of speculation that is getting the cart ahead of the horse," he said. Back in April 2011 when Ryan's plan was under consideration in the House of Representatives, Romney issued a statement on the proposal. According to Talking Points Memo, he said, "I applaud Rep. Paul Ryan for recognizing the looming financial crisis that faces our nation and for the creative and bold thinking that he brings to the debate. He is setting the right tone for finally getting spending and entitlements under control. Anyone who has read my book knows that we are on the same page." After the candidate expressed ambivalence about entitlement reform at an event with GOP donors in New York in April, a spokesman for Romney relayed the following statement to Ben Smith at Politico seeking to clarify the Republican hopeful's position:

"Mitt Romney recognizes that it is absolutely imperative that we take on the rising cost of entitlements, which is why in his book he devotes an entire chapter to the specific steps he would pursue to rein in Social Security, Medicare and Medicaid," he said, pointing to the chapter in which Romney suggests a combination of technical adjustments and more sweeping reforms to the entitlement plans.

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Former Massachusetts Gov. Mitt Romney has exercised caution in communicating his position on Ryan's proposal. While he has signaled support for the objectives it seeks to accomplish, the presidential candidate has said he intends to put forth his own plan for entitlement reform.

"If we don't make any changes, then Medicare won't be there for the next generation and that's unacceptable to me. So I appreciate what Paul Ryan has done," Romney said during a stop in Iowa. "I'm going to have my own plan."

When asked specifically if he would endorse Ryan's proposal if elected president, Romney dodged the question. "That's the kind of speculation that is getting the cart ahead of the horse," he said.

Back in April 2011 when Ryan's plan was under consideration in the House of Representatives, Romney issued a statement on the proposal. According to Talking Points Memo, he said, "I applaud Rep. Paul Ryan for recognizing the looming financial crisis that faces our nation and for the creative and bold thinking that he brings to the debate. He is setting the right tone for finally getting spending and entitlements under control. Anyone who has read my book knows that we are on the same page."

After the candidate expressed ambivalence about entitlement reform at an event with GOP donors in New York in April, a spokesman for Romney relayed the following statement to Ben Smith at Politico seeking to clarify the Republican hopeful's position:

"Mitt Romney recognizes that it is absolutely imperative that we take on the rising cost of entitlements, which is why in his book he devotes an entire chapter to the specific steps he would pursue to rein in Social Security, Medicare and Medicaid," he said, pointing to the chapter in which Romney suggests a combination of technical adjustments and more sweeping reforms to the entitlement plans.

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Comments

[olerealist]

03:21 PM on 03/26/2012

Representative Paul Ryan. Little brain but lot of guts.

It becomes more clear each day that the objective of the Republican leadership is the destruction of the American middle class. Added to this is that, contrary to PR, they LOVE DEFICITS!.

The new Ryan budget would not end deficit spending until 2040. It would cut taxes by 4.6 trillion dollars over a decade. It would extend the Bush tax cuts by an additional 5.4 trillion. So his total deficit expansion would come to around 10 trillion dollars. Only one spending item would increase, that of the Pentagon. All programs giving any aid to the low income class would be badly shredded.

Ryan’s rebuttal is that the revenue would be enhanced by cleaning up the Tax Code. But he did not make ANY specific how to suggestions.

Robert Greenstein of the Center And Policy Priorities, and known to be moderately conservative, states: “It (Ryan Budget) would likely produce the largest redistribution of income from the bottom to the top in U.S. history, and increase poverty and inequality more than any other budget in recent times”

There is also a multiplier effect in respect to health insurance or coverage. The ranks of the uninsured would be increased leading to medical neglect leading to more expensive uncompensated treatment, leading to increasing premium costs.

In some of the foregoing I give credit to E.J. Dionne, Jr. Washington Post.

[Ravenlea]

06:50 PM on 03/22/2012

There is a petition by Catholics United asking bishops to stand up for the poor. You don't have to be Catholic to sign. The link to the petition is on the upper right where it says "Click here" in red.

http://www.catholics-united.org/content/press-release-lay-catholics-call-bishops-be-consistent-defend-poor-paul-ryan%E2%80%99s-budget-cuts

[Tom Sito]

04:16 AM on 03/22/2012

Any politician who demands cuts without mentioning the Rich now pay the lowest taxes in US History should not be taken seriously.

[bboyy]

10:11 PM on 03/21/2012

Three trillion in tax cuts for the wealthy...eff that

[kruelhunter]

11:44 AM on 03/21/2012

1. Medicare - Medicare has already lost a half billion to Obamacare.

2. Medicaid - Currently Medicaid spending by states is arranged so that the states have only to agree to federal mandates in order to have federal monies exceeding state spending on the program, a situation in which the state politicians can offer benefits that the states cannot afford and which qualifies them for more federal funding in succeeding years. Clearly an untenable situation if we are to reduce federal spending and the national debt.

3. Health Care Reform - Ryan's plan for Medicare would eliminate much of the waste the author refers to by giving the money now going to these associated firms to the consumer instead under the belief that the consumer will spend it more carefully than the bureaucracy that currently encourages waste and fraud through its ineptitude.

4. Tax Reform - Some fifty percent of wage earners currently pay no federal income taxes so it is clearly unfair to reduce tax rate on those who actually pay federal income taxes. I know, I know but it sounds just as stupid no matter how you say it.

5. Defense Spending - Defense spending, in case the author has not noticed, is the one sort of federal spending that is actually mandated by the constitution while health care and welfare, ie charity, are the responsibiltiy of the citizens. Seems to me a fair division of responsiblitiy but evidently the author disagrees.

[Muswell Hillbilly]

01:32 PM on 03/21/2012

1.Medicare Advantage, a government hand-out to private insurance companies and costs the taxpayer three times more than any other Medicare program, is being cut.
2.Since health insurance companies will have the right to refuse to sell people health insurance(repeal of Obamacare), how many of those insurance companies will accept those vouchers.
3. My favorite bs argument is that almost half the population pay taxes.
If you take into account payroll taxes, only 26% has no tax liabilty.
Also, 47% don't owe any additional taxes, which means they get a tax refund.
Most of those people, I bet, get a tax refund that is less than the amount of federal taxes they had taken out of their paycheck. How many of those people, who don't pay taxes,are retirees who paid their fair share in federal taxes during their working years.
4. Defense Spending: Founding Father Thomas Jefferson reduced the deficit by cutting military spending. Why shouldn't we cut the amount of money we hand over to defense contractors like Haliburton?

[emmanuel kalu]

11:44 AM on 03/21/2012

i really hope that democrats would hang this attack on worker and the big 3 on every republican running for office. they especially need to hang in on Mitt. This is completely an attack on workers and making workers pay for the enrichment of the rich, the continue looting by corporation especially defense contractor and the complete destruction of our economy and the benefit paid for by workers. it is time we take action to deal with republicans. we must reach out to progressive and ask them to fight this to the end. we must vote every regressive republican out of office. it is really clear that progressive dems need to control congress, senate and the white house for this country to progress and deal with it major issue. republican congress has being a huge waste of time and money.

[JDZSB]

10:25 AM on 03/21/2012

Paul Ryan seems to be the only person in Washington trying to find some rational way to turn around the financial mess our government has created that is growing worse by the day. He presented his first plan last year and, of course, he was demonized by Republicans and depicted as wanting to push Grandma over the cliff, etc. in political ads. He is a smart and competent lawmaker and knows more about the cost drivers in the federal government then Obama or Harry Reid, and probably everyone else in Congress. This new plan is an iteration of his first plan which reflects changes based on feedback and criticisms of his first plan, and of course, the liberal politicians are immediately going after him for political gains without really spending any time debating it with Ryan himself. The Dems have yet to present ONE plan aimed at balancing the budget or dealing with the national debt.

[Prairiewinds]

11:02 AM on 03/21/2012

There used to be a sound and appropriate way to deal with shill legislators like Paul Ryan, and maybe this is the time to bring it back into favor. All you need is a bucket of warm tar, some chicken feathers and a nice, splintery oak rail.

[olerealist]

03:48 PM on 03/26/2012

HELLO P--Winds Quote: " All you need is a bucket of warm tar, some chicken feathers and a nice, splintery oak rail."

No not WARM. This needs to be HOT !

[Muswell Hillbilly]

11:06 AM on 03/21/2012

First of all, when the Republicans whined that Obama was hurting seniors by seeking to cut the Medicare Advantage Program, a program that costs the taxpayer three times more than any other Medicare program.
Second,the House Progressives offered a plan, the people's budget, which would achieve through a mixture of tax increases and spending cuts, a balanced budget by 2018.
Ryan's plan, last year, stated that we wouldn't be in the black until 2040.
Eisenhower, the last Republican President to achiveve a balanced budget, with a Democratic Congress, campaigned against the Kennedy Tax Cuts. Eisenhower was smart enough to know that you can't cut taxes and balance the budget.

[Muswell Hillbilly]

10:13 AM on 03/21/2012

Who cares what a Corporate Welfare Republican like Ryan thinks?
Ryan voted for Medicare Part D, tax cuts during two wars(the most egregious example of generational theft I can think of), Tarp, and to raise the debt ceiling eight times during the Bush years.
It's kind of like when Larry Craig called Clinton a "naughty, nasty boy."

[newpoliticaljunkie]

10:10 AM on 03/21/2012

What a nice thought - the GOP has simply handed independents in this country yet another reason to rush to the polls and NOT vote for them this Fall....... Just another reason.......

[StarGazr5992]

09:43 AM on 03/21/2012

Wonder if he is up for re-election in Nov? could only hope

[morgantown]

10:52 AM on 03/21/2012

All members of House of Reps serve two year terms, they must be re-elected every two years, so in answer to your question, yes, he is up for re-election in Nov.

[Dev Austin]

09:36 AM on 03/21/2012

What if all that super pack money was applied to deficit rather then going to those that want to attack the elderly and poor and basically eliminate the middle class?

[nothingchanges]

09:31 AM on 03/21/2012

"Paul Ryan's New Plan Could Put GOP Candidates In Awkward Spot"

Want to put the entire GOP propaganda machine in an "Awkward Spot"?

Pass laws that require "Truth in Advertising" for political campaigns.

Every statement proven to be a lie, results in a hefty fine. (Used to pay down the debt)

When "He who lies best....................wins".............................WE lose.

[newpoliticaljunkie]

10:11 AM on 03/21/2012

F & F for an excellent post.......

[Independentproud]

09:13 AM on 03/21/2012

There's good news and bad news.

First the bad news:

As reported by CBS news a couple of days ago, "The federal budget sent to Congress last month by Mr. Obama, projects the National Debt will continue to rise as far as the eye can see. The budget shows the Debt hitting $16.3 trillion in 2012, $17.5 trillion in 2013 and $25.9 trillion in 2022."

Right now we borrow 40 cents out of every dollar. What is going to happen in 2022? At some point we won't be able to continue to borrow and the bill will have to be paid. Taxes on all brackets will have to rise. Dropping the Bush tax cuts sound good, but that will only net $1.7 trillion.... what about the other $24 trillion? Yep... you guessed it... everyone with a job will be paying the 50-60% tax rates of Sweden. The point is that standard of livings will have to drop to pay this off. It's a pay me now or pay me later thing.

The good news:

No one here wants to tackle this problem now and they ridicule people who do. Instead they want to kick it down the road to the next generation to pay.

the great news:

I'll be retired and will not have to worry about any of this by the time the taxes go sky high! Every cloud has a silver lining.

[Muswell Hillbilly]

10:10 AM on 03/21/2012

In the 1950s and 1960s, Americans paid over 50%. Are you saying that the economy is better now than it was then?
Sweden,by the way, has one highest standards of living in the world;a lower unemployment rate than the US(7.8%), and an economy that hinges on manufacturing rather than consumer spending.

[olerealist]

03:55 PM on 03/26/2012

QUOTE: "everyone with a job will be paying the 50-60% tax rates of Sweden."

NOT EVERYONE WITH A JOB. Just those with jobs like Romney and Buffet.

[Harleigh]

09:11 AM on 03/21/2012

So prosperity is for all merikans to be broke and uninsured. brilliant.

[Harleigh]

09:08 AM on 03/21/2012

Warren is for the 99% while Brown is just another bottom feeding bagger. MA will elect Warren.