Ryan’s blueprint: How to cut $4 trillion by really trying

“Forget the battle over billions,” said Mark McKinnon in TheDailyBeast.com. While Congress and the White House continue to battle over symbolic cuts to the 2011 budget, GOP Rep. Paul Ryan this week released a bold, long-term plan to cut trillions from the deficit, and save the country from its spiraling fiscal crisis. Ryan’s proposed spending plan for 2012 and beyond is “the most comprehensive and most courageous budget-reform proposal any of us have seen in our lifetimes,” said David Brooks in The New York Times. The plan cuts federal spending by an impressive $4 trillion over the next decade, but “the important thing” is how it reforms Medicare and Medicaid, our most costly entitlement programs. Medicare would become a federally subsidized private-insurance program, in which tomorrow’s seniors would get a fixed amount of money with which to buy coverage. Medicaid would be provided in the form of block grants to the states, giving them control over how best to spend the money. Ryan’s budget plan is just the start of a prolonged debate, but someone in Washington has finally “grasped reality with both hands.”

“Give Paul Ryan credit,” said Ezra Klein in WashingtonPost.com. He’s managed to use “reform” to pretty up the Republicans’ dream of spending much, much less on health care for the poor and the elderly. Distributing Medicaid in the form of “block grants” to the states simply means that if costs rise or more people fall into poverty, the answer will be: “too bad.” To take a meat cleaver to Medicare, Ryan would replace fee-for-service coverage with a defined federal subsidy to seniors. As medical costs rise, and as seniors face deductibles and coverage limits, they’d have to shoulder more and more of the cost of health care—or do without it. This is nothing more than a heartless plan “to cut spending, whatever the consequences.”

It’s even worse than that, said Harold Meyerson in The Washington Post. At the same time Ryan pushes more health-care costs onto the poor and the elderly, he provides a huge reduction in the top income-tax rate—from 35 percent to 25 percent. All told, Ryan would reduce federal tax revenues by $4 trillion over 10 years. If he were honestly just trying to pay off the deficit, rather than dismantle the welfare state and “repeal the 20th century,” wouldn’t a tax hike on the wealthiest Americans make more sense? Ryan’s plan does eliminate most tax deductions, said Jonathan Chait in The New Republic online, but that “massive, regressive” income-tax cut for the wealthy is the plan’s “Achilles’ heel.” Once the public realizes the GOP wants to end Medicare “in order to finance a huge tax cut for people who don’t really need it,” Ryan’s plan will be dead in the water.

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Ryan’s tax-cut proposal may need some tweaking, said Jacob Weisberg in Slate.com, but the Medicare portion of his plan is “brave, radical, and smart.” The $15,000 a year he’d provide seniors should buy “excellent coverage.” Medicare now consumes more than half a trillion dollars a year, and is rising fast; its cost “is crowding out everything else that Washington does or might do.” Ryan is simply asking that the elderly “enter the health-care world the rest of us live in, with co-payments, deductibles, and managed care.” If that’s too radical and heartless for Democrats, then they’re free to propose a better solution to our fiscal crisis. Thanks to Paul Ryan, “the ball is now in their court.”