Friday, March 23, 2012

Paul Ryan Budget Plan Devastates Medicare and Medicaid and Federal Spending on Social Programs to Provide Tax Cuts for the Wealthy

Really, Just What Did You Expect

Just as everyone was wondering what the next Republican outrage would be, Rep. Paul Ryan (R, Wi) has come up with a budget, spending and tax plan that does exactly what everyone would think it would do.  On the tax side the top rate which is scheduled to go to 39.5% at the end of the year would drop to 25%.  On the spending side the biggest casualties are Medicare and Medicaid.

And no, one cannot be precise on what will happen because the Ryan Plan is very short on specifics, because they specifics would cause the public to recoil in horror.  But the Congressional Budget Office, accepted as the scorekeeper in these matters is not optimistic.

The implications of that substantial cut in spending relative to the other policy scenarios are unclear, because they would depend on both the specific policies that were implemented to generate that spending amount and the ways in which the nation’s health care and health insurance systems reacted to those policies.

 Possible consequences include the same kinds of effects noted for the baseline and alternative fiscal scenarios—reduced access to health care; diminished quality of care; increased efficiency of health care delivery; less investment in new, high-cost technologies; or some combination of those outcomes. In addition, beneficiaries might face higher costs, which could in turn reinforce some of the other effects.

At least some of those effects would of necessity be a great deal stronger than under the baseline scenario or alternative fiscal scenario because spending would be so much lower. However, as with the other scenarios, CBO does not have the capability at this time to estimate such effects for the specified path of Medicare spending.

And yes, Mitt Romney has endorsed the Ryan plan.  This makes his third tax plan, who knows how many more iterations he will come up with.  To be fair, though, it looks like Mr. Romney gave his endorsement before actually reading or understanding the plan.  Those things really don't matter in his case.

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