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Now that we are sure that Paul Ryan is going to be the VP for Romney, I thought it was important to revisit the Paul Ryan "Path to Prosperity" Budget Plan.

To be honest, the only thing I knew about the plan was snippets that I either read in varying newspapers or at political blogs.  I figured that I would take the morning and actually read the proposal.  

It can be found at: http://budget.house.gov/...

A summary written by Paul Ryan for the lazy can been found at:  http://online.wsj.com/...

My idea with this diary is to make sure each of us is armed with the facts that are contained in this plan.  We should be able to rebuttal specific details to our friends and neighbors.

Please feel free to clarify or argue against any the summaries that I have concluded after reading the plan.

Let's get started.

Providing for the Common Defense: (starting at page 17)

Paul Ryan would like to increase the 2013 military budget by 554 billion dollars.  
That amount would raise every year to reflect inflation.
He would not cut the budget at all during war time.
He would also like to exclude defense from any sequester savings.

I don't think there are any surprises in there.  It is interesting to compare this increase of budget versus other areas that he is more than willing to cut.

Restoring Economic Freedom (starting at page 23)

The government would not longer provide subsidizes for "green" energy companies.
The government would open up the US soil for further oil/coal/etc exploration.  Example sited is the Keystone XL Pipeline.
The EPA would be significantly scaled back.  Current regulations make it "hard" for business to run.
Freddie Mac and Fannie Mae would privatized.  The government would not longer subsidize   mortgages.  Mortgages would be provided solely by the private market.
There is also a piece about The FHA’s Mutual Mortgage Insurance Fund’s.  (I don't know enough about this fund to offer a comment.  Would love more information)
Repeal the healthcare act.
Paul Ryan would impose a pay freeze until 2015 on all federal employees.  He also is planning to cut 10% of the workforce, as well as renegotiate federal benefits with employees contributing a large share to retirement benefits.
Increases the budgets for anti-fraud division.
Fire sale of federal assets.  This includes millions of acres of federal land, federal building, federal cars etc...
Cut federal subsidizes to Farming communities.

The things that stood out to me was the cutting of farm subsidizes.  Very interesting...Does Kansas know this?  Also the fire sale of federal land.  Say hello to condo's on Half Dome brought to you by private developers.

Repairing the Social Safety Net (starting at page 34)

Return Medicaid to states in the form of a block grant as well as cut the funding for the next ten years.
(For those unfamiliar with a block grant..see http://en.wikipedia.org/...)
Supplemental Nutrition Assistance Program(Food Stamps) will also be sent to the States as a block grant.  There would be monitoring of the program to make sure no fraud was happening.
Welfare and any other kind of state assistance would be granted only with work/job training and there would be time limits.
Paul Ryan would cut off access to federal subsized student loans.  He argues that ease of financial aid has caused college tuition to rise.  He would also reduce the amount for Pell Grants.
He would soften regulation of "for-profit" institutions.  Those who can't get student loans would be able to take online courses.
Reduce the number of job training programs.  Claims they overlap each other.

The big thing that stands out to me is that if you are poor, you are getting screwed by this plan.  Under Ryan's plan, I would have be unable to go to college.  I would have not had access to federal student loans and would have had to rely on the private sector.  Trust me when I say, no private lender would have given me a loan.  My only other option would have been to take "online courses" while I worked to save up enough money to go to school.

Strengthening Health and Retirement Security (starting at page 45)

I'm going to paraphrase my understanding of this section.

Every person under the age of 55 starting in 2023 will not get traditional Medicare.  Instead every year, insurance companies will submit competitive bids on a "Medicare Exchange".  The second-­‐least expensive program will set the annual subsidy amount that the federal government will pay.  People will be able to choose one of the plans on the system.  Any plan that cost over the subsidy comes out of your pocket.  There are no specifics on what these plans will provide or cover.  You can also use your subsidy as a pay as you go credit in a "fee-for-service" plan.  Any amount not used will be reimbursed to you.

People currently on Medicare will not be affected.
Medical malpractice lawsuits would be capped.
He would get rid of the IPAB ("death panels")

The budget offers no specific plan for Social Security.  It does complain that people are living longer and retiring earlier, therefore creating a burden for younger workers.  It suggest a panel that will look at solutions to "fix" Social Security.

Pro-Growth Tax Reform

Paul Ryan's plan would create two tax rates.  10% and 25%.  It does not state at what income level the 25% starts.
It reduces the corporate tax rate to 25%
It "expands" the tax base.
It eliminates most tax deductions.  It does not state which ones he is keeping.
Shifts to a “territorial” tax system rather than a "worldwide" tax system.

A few points.  First "expand the tax base" is code for forcing low income earners to pay federal taxes.  My suspicion is that the tax deductions that will not be eliminated will be ones that are used mainly by high earners.  The second point is the "territorial" tax system.  As an ex-pat, I know this means that corporations incorporated outside the US will not be subjected to even the 25% corporate tax rule.  So all the corporations registered in tax havens will have an tax rate of 0%.  The current system requires all income by US residents to be declared every year.

Please see the following comment on "territorial" tax system.  http://www.dailykos.com/...

  As an ex-pat I still have to file a tax return with the IRS.  If we had a "territorial" system for individuals, I would pay the tax rate of the country I live in and if that was less than my US rate, I would not have to pay extra.  Notice that is proposal is ONLY for corporations.

Change Washington's culture of spending

Get rid of the discretionary sequester and replace it with a cap.
All government programs would have a cap.
All increase in programs would have to be offset by a spending cut.  (I am assuming that defense is excluded from this)
All programs would have to be projected longer than 10 years by the CBO.
Every program would be reviewed each year and none guaranteed funding.  There would be no baseline and therefore no inflation increases to funding.
Project cost for Social Security, Medicare and Medicaid out to 75 years.

This doesn't say much about which programs would be cut.  However after reading online, it is apparently hidden in the Appendix.  Please see the Washington Post article for more details...http://www.washingtonpost.com/...

Lifting the Crushing Burden of Debt (starting at page 75)

This section doesn't offer any specific solutions other than to say look at the amount we owes those scary foreigners.  It basically says that if you follow the above plan, we will have a budget surplus by 2024.

That in a very long nutshell is what the plans says.  Any questions? Any comments?

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Comment Preferences

  •  Excellent diary: and the Obama campaign (6+ / 0-)

    is ready right now to start stomping Romney-Ryan like grapes.  Champagne bottles were probably uncorked at OFA headquarters over this pick.

    Thanks for bringing the specifics to us this morning.

  •  Wendell Potter is calling (6+ / 0-)

    the Paul Ryan plan A Path To The Poorhouse

    That's a good one and we need to use that phrase!

    As a member of Courtesy Kos, I am dedicated to civility and respect for all kossacks, regardless of their opinions, affiliations, or cliques.

    by joedemocrat on Sat Aug 11, 2012 at 08:46:14 AM PDT

  •  "territorial" tax system definition (2+ / 0-)
    Recommended by:
    sideboth, CoyoteMarti

    Your description is not correct. Under a "terretorial" system, corporate taxes are owed on earnings that are earned in the USA and it does not matter where the parent is incorporated. Example: a USA company, GE (General Electric) earns money in the USA and in Mexico.  GE would owe US federal income tax on the USA income, but owe no US income tax on the Mexico income.  

    Current US tax law taxes all worldwide income for US corporations, but generally allows a tax credit for foreign income taxes paid.  Current law, foreign companies pay US tax on their US operations.

    You shall know the truth, and the truth shall make you free.

    by TX Dem 50 on Sat Aug 11, 2012 at 09:15:36 AM PDT

    •  Thank you for the correction. (0+ / 0-)

      This shift would still result in a lower tax bill for corporations.  I also think that it would encourage more companies to outsource to low tax havens as they would pay the local taxes without having to pay US taxes as well.

  •  Thanks for distilling this down for us sideboth. (2+ / 0-)
    Recommended by:
    sideboth, MRA NY

    It would be helpful to distill this down by another 50% if you still have the energy in the upcoming weeks.  

    I have so much to read, I'm having trouble absorbing all of it this morning.

    Thanks again.

    The means is the ends in the process of becoming. - Mahatma Gandhi

    by HoundDog on Sat Aug 11, 2012 at 09:42:33 AM PDT

    •  How about this? (1+ / 0-)
      Recommended by:
      HoundDog

      Paul Ryan budget = good for the 1%, bad for everyone else.  :)

      •  Love it, but my brain can take even more than this (1+ / 0-)
        Recommended by:
        sideboth

        I'm hoping to see an easy read list of 10 to 20 more one liners that give us more substance.

        LOL

        I hope you don't thnk I'm toying with you.  I'm just aware of the narrow bandwidth we face in getting ideas out to the general public.

        My 79 year old mother was just asking me what I thought about Ryan.   She had heard someone say at church,  that "Ryan has a great plan for saving Medicare from the destruction it will face under Obama and the Democrats."

        She's intuitive knows this doesn't sound right, but wouldn't it be great it we could give her a counter response simple enough she could remember and say in central PA where there are a lot of Tea Bagger diehards, with their Karl Rove inspired "whisper networks" working every social place with their weekly telephone tree GOP talking points.  

        What are the 1, 2, 3. blamo Democratic Party talking points we can abstract out of this.  Bumper stickers like this are great too, but will not be enough to stand-off the informal army of Tea Baggers who are cruising churches, lunch rooms, bars, and other public places looking for vulnerable victims.

        We need a "Just Say No!" to mindless stupidity campaign that has a half dozen solid bullet points, ordinary, non-political people will find compelling, and can remember.

        The means is the ends in the process of becoming. - Mahatma Gandhi

        by HoundDog on Sat Aug 11, 2012 at 10:23:16 AM PDT

        [ Parent ]

        •  Here a quick version. (2+ / 0-)
          Recommended by:
          HoundDog, ivote2004

          His plan will

          1.  Shift the tax burden from the wealthy and corporations to the lower and middle class.

          2.  The most needy students will be denied a higher education due to lack of access to federal subsidized student loans.

          3.  Medicare will be dismantled and replaced with a for profit system.  Senior Citizens will face uncertain benefits and rising costs as they are forced to absorb more and more of the burden.

          4.  Social Security is at risk.

          5.  Every government program is at risk for cutting except for the defense, which will enjoy an unlimited budget.

  •  How much does the Ryan plan cost a forty-something (1+ / 0-)
    Recommended by:
    sideboth

    It is easy to solve the federal budget problem by creating a household budget problem. Health costs will continue to rise perhaps as fast as 2.5% above inflation but the Ryan helathcare payment support--coupon by another name--does not rise this fast.

    So, what does not get enough attention is what people my age would need to start putting aside for retirement health expenses if this plan were implemented.  

    Said another way, no one asks what adjustments need to be made to folks retirement plans already underway-- if they happen to be around fifty years old right now-- as this is phased in

    I crowd source this question.

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