Can we just skip to the part where the 2012 budget lands somewhere in between Obama's plan and Ryan's plan and both sides complain?
David Plouffe said today that President Obama would reveal specifics on his long-term deficit reduction plan on Wednesday. And on that day, everyone who complained about the President not putting forth a deficit reduction plan will complain about the President's deficit reduction plan.
A top White House political and economic adviser says President Obama will lay out new plans this week to reduce the federal deficit.
Obama adviser David Plouffe, speaking Sunday on NBC's "Meet the Press," says Obama plans to offer ideas for what Plouffe calls "long-term deficit reduction" as Congress begins to debate raising the nation's debt ceiling.
Plouffe is giving few specifics on what Obama will announce, but he says that the president believes taxes should go up on higher-income Americans. He also says that the Republican budget plan offered this week by congressman Paul Ryan of Wisconsin may pass the House but won't become law.
The gist of Ryan's plan (as I understand it) is this:
Repeal "Obamacare," something that is both the source of a good deal of Ryan's "savings" but remains just as unlikely as it was a couple of months ago. The idea is to save the $725 billion that people would have received to help cover the cost of health care. It's akin to me unveiling a plan where a unicorn stops by and craps $725 billion on the floor. The law's not getting repealed, and a budget plan that hinges on that happening is disingenuous.
With Medicare, the Ryan plan will make seniors purchase a private health plan from one of the insurers that caused the need for health care reform in the first place. It basically becomes a voucher plan. The problem with it is that I've read the Ryan plan links the vouchers to the consumer price index, not the inflation rate for health care expenses, which means as time goes on, the vouchers will cover less and less than they do now, increasing costs for medicare recipients. The CBO scored it this way:
"Under the proposal, most elderly people would pay more for their health care than they would pay under the current Medicare system. For a typical 65-year-old with average health spending enrolled in a plan with benefits similar to those currently provided by Medicare, CBO estimated the beneficiary’s spending on premiums and out-of-pocket expenditures as a share of a benchmark: what total health care spending would be if a private insurer covered the beneficiary. By 2030, the beneficiary’s spending would be 68 percent of that benchmark under the proposal, 25 percent under the extended-baseline scenario, and 30 percent under the alternative fiscal scenario."
On it's own, that's tough for folks to swallow. But when you consider that after a couple of years of portraying a 3% increase in the top tiers as "excessive," the Ryan plan would cut the highest individual and corporate tax rates from 35% to 25%. While I can get down with lowering corporate tax rates (and I imagine a corporate tax reduction will be part of the president's plan as well), cutting the top tier by TEN PERCENT while asking people on Medicare to pay more just doesn't seem to be the easiest sell in the world.
Kudos to Ryan for having a plan. And yes, the Democrats could have avoided a lot of this trouble by passing a budget through normal channels last year (again, if the GOP Senate would have let them). But just as I don't expect the President's proposal to be accepted verbatim, nor should anyone expect Ryan's plan to get that treatment either. The result will almost surely be somewhere in between.