Rep. Paul Ryan Unveils Budget Plan

Rep. Paul Ryan unveiled his budget plan and roadmap for the next 10 years. The proposal cuts $5.8 trillion from anticipated spending levels over the next decade.

Highlights:

• 
  Starting in 2022 Medicare would revert to private insurance plans. Elderly people would choose a private insurance plan from a list provided by the government and vouchers would be issued to individuals to help them pay for health insurance coverage. There would be a $15,000 cap on voucher subsidies.

• Medicaid, the federal-state health care plan for the poor would turn into a block grant to the states and be cut by $750 billion over the next 10 years.

• 
  Domestic programs would be reduced below 2008 levels for the next five years.

• Defense would be cut by $78 billion — $100 billion less than the cuts recommended by Defense Secretary Robert Gates.

• The top tax rate for both individuals and corporations would be reduced to 25 percent from 35 percent, reducing the number of income tax brackets and eliminating loopholes.

 

Comments.

Regarding Medicare--Rather than the current set-up where the government decides which procedures Medicare will cover and the amount of the coverage, this plan will put consumers in charge of deciding their own treatments based on their budget and the cap on the voucher subsidy. As far as I know, there is no provision for pre-existing conditions, so when you turn 65 anytime after 2022 when the new system would be in effect, you could be denied coverage.

Furthermore, once you exhaust your $15,000 in potential vouchers you would be on your own for health insurance premiums. So for someone with pre-existing conditions this could be a prescription for bankruptcy or death. Kind of a false choice but at least the individual can choose, huh?

Also, this Medicare plan sounds strikingly similar to Obamacare's private health insurance exchanges whereby people purchase insurance from an approved list provided by government.

Regarding Medicaid--Converting this into a block grant for states essentially creates a single payer system for health insurance for the poor run by the individual state. There would be a global budget administered by each state.

Regarding Defense--The amount of $78 Billion over 10 years. Really? Is that all you could find?

Regarding simplifying the tax code and reducing the top rates from 35% to 25%. Agree with it in principal so long as myriads of loopholes are eliminated and the mid and lower tax brackets are adjusted as well. For example, perhaps instead of five tax brackets we only have three--10%, 15% and 25%.

Anybody else want to comment?

 

I've got mixed feelings. It is a plan, but it just doesn't go far enough. $78 Billion in cuts to defense in 10 years? That's nothing. Doesn't address social security at all.

I wish he would have made deeper cuts--reverting to 2008 spending levels is not a whole lot--and addressed social security so perhaps a few of his ideas would get passed. The way this is set up the Dems won't have to compromise and can blockade almost everything.