Paul Ryan says Democratic distortion and demagoguery of his Medicare plan is to blame for a special-election loss in a New York congressional district yesterday, which is being touted as a sign of a building Dem comeback from their 2010 shellacking.
I have mixed feelings about this. On the one hand, the Ryan plan is genuinely worth of criticism — even harsh criticism — on a variety of fronts, most notably that it forces the poor, the elderly (well, the future elderly) and the needy to bear a disproportionate share of the burden for getting our fiscal house in order, while simultaneously lowering taxes on the wealthy in service of the Republican fantasy that such tax cuts somehow don’t add to deficits, which, of course, they do. All serious analysts know that we need to cut spending and increase revenue — not either/or, but both/and — in order to solve our budget crisis. By that test, Ryan’s plan is fundamentally unserious.
On the other hand, Ryan’s plan had the potential to be the opening salvo in a serious conversation, an actual adult dialogue about this issue. If the Democrats respond by attacking its flaws — and, again, there’s nothing wrong with doing so harshly, to the extent those flaws are worthy of harsh criticism, so long as the harsh criticism is properly targeted — while offering a viable alternative that spreads the pain more equitably but still inflicts the necessary pain, that would be one thing. If they respond with ruthless, demagogic “Mediscare” tactics, without offering an honest, viable alternative, that’s another thing entirely. And if they succeed in the latter approach, and Washington once again learns the lesson that entitlements are (still) the third rail of American politics, that’s a disaster, and we’re well and truly doomed.
I haven’t followed the politics of this too closely in recent months, but my sense is that the Democratic response so far has a lot more of the latter (demagogic) approach than the former (responsible) one. And frankly, I’m not sure what political incentive they have to do otherwise. As with the debt ceiling and a wide variety of other issues, the shallowness and ignorance of the average voter creates an almost irresistible temptation for politicians of all stripes to misbehave in this fashion when the politics of an issue tilt in their favor. The end result is that we become increasingly ungovernable as a nation — incapable of tackling and solving big problems whose solutions require painful choices — as these demagogic techniques seemingly get more and more sophisticated and effective. In other words, we move closer to the event horizon.
Maybe some sort of grand bargain will simultaneously defuse the GOP’s feckless demagoguery on the debt ceiling/taxation and the Dems’ feckless demagoguery on Medicare, putting us on a marginally more sustainable course without first jumping off a cliff. Maybe the Democrats will listen to Bill Clinton, who, while harshly criticizing the Ryan plan today, also said, “I’m afraid the Democrats will draw the conclusion that because Congressman Ryan’s proposal is not the right one, that we shouldn’t do anything. I completely disagree with that.” (Of course, it’s easy to say we should do something; it’s harder to specify precisely what.)
Or maybe the Dems will take the easy course, and President Obama will go down in history as the president who, on the brink of a national fiscal crisis, won re-election with the age-old “Mediscare” trick, thus effectively taking meaningful entitlement reform off the table for an indeterminate period of time, once again kicking the can down America’s ever shortening road to ruin. If so, f*** him.
I still think Obama’s heart is in the right place on this. But in the end, unless his actions prove me right, I don’t give a s*** where his heart is. There is no excuse for a leader failing to lead. Well, no, that’s not right — there are plenty of excuses, but we must be steadfast in ignoring them, because unless we demand leadership of our leaders, even (or especially) when it’s difficult to exercise it, why do we bother with any of this?
As I’ve previously made clear, I’m already greatly unimpressed with Obama’s approach to the fiscal crisis, and profoundly uncomfortable with his apparent strategy of delaying meaningful entitlement reform until his second term. One reason for my discomfort is that if, in the mean time, the Democrats achieve a great political victory next year by relentlessly demagoguing entitlement reform (albeit a flawed vision of it), I’m incredibly skeptical that they’ll be able to suddenly shift gears and start governing responsibly on the issue. Even if Obama wants to do that, it may again prove “politically infeasible,” and he’ll have to “delay” it again. At which point I won’t be uncomfortable or skeptical, but apoplectic. For now, I reserve final judgment. But I am concerned.
FICA is, technically, a creditor of the US Treasury. Your argument seems to that it is okay for the government to default on this debt and further that is okay to make that possible by not providing the service that people are forced to pay for. In a nut that’s why entitlements are a third rail. Because it is theft and on a product we have to buy.
There are things wrong with Medicare and there are things wrong with Social Security. But if the system was permitted to work as designed instead of being constantly robbed, (Note also, the tax burden for FICA is bourn disproportionately by those making less than the cutoff amount (about 106K) so this is robbing the middle class, lower middle class, and the working poor) those problems would be significantly more manageable. Had Part D not been passed as a subsidy to the drug companies we would be in even better shape. If we fixed how we handle medicine in this country we would be in even better shape than that.
Entitlements are a completely separate issue form the rest of the budget and we really do need to make them completely their own thing. The system should neither contribute to nor be contributed to from the general fund (beyond the repayment of all debts with associate interest). Once that’s done we can talk about making that system properly self sustaining. And we can also properly discuss managing the budget and the associated debt and deficit. But these are two different things.
The Republicans like to conflate them because it is useful to their pro rich pro fortune 500 agenda (which is really all they actually care about, after all it’s what keeps their pockets lined and the door revolving.) The Democrats are bad about that stuff, the Republicans are atrocious.
The end result is that we become increasingly ungovernable as a nation — incapable of tackling and solving big problems whose solutions require painful choices — as these demagogic techniques seemingly get more and more sophisticated and effective.
“There was never a democracy that did not commit suicide.” John Adams
Putting aside the Democratic fantasies that increasing tax rates inexorably leads to increased revenues, and that there are enough of the “wealthy” to cover even, say, half of what the gov’t is spending (serious analysts know that any revenue side of any budget crisis solution will pale in comparison to the spending portion) – Brendan’s criticism that the “needy” will “bear a disproportionate share of the burden” under Ryan’s plan assumes that a more open insurance market cannot possibly be more efficient, and indeed must be less so, than the current Medicare system. But that completely misses the logic behind Ryan’s plan, which is premised on the perfectly logical and historically accurate belief that subjecting health care prices to market pressures will eliminate the inherent distortions that have caused the inefficient utilization of services and arbitrary prices in the current fee-for-service system, which would result in the more economical use of services and higher quality care that in turn lowers the amount the gov’t needs to spend. Now maybe it wouldn’t actually work out that way, I don’t know. But what I do know is that many projections by “serious analysts” that Ryan’s plan would mean the poor, elderly*, etc. will necessarily foot more of the bill overlook the pricing mechanism he’s talking about and ignore the possibility (usually without any explanation) that his plan could actually lead to cost savings or improved quality of care.
But even if that criticism turns out to be correct, shouldn’t the risk of looming insolvency justify having at least the “future elderly” (i.e., everyone) chip in a little more for their Medicare coverage?
* Ryan’s plan would not affect people over 55, so by any reasonable definition, the “elderly” should not be part of the debate, not that such facts will get in the way of the Left’s Mediscare campaign.
Democratic fantasies that increasing tax rates inexorably leads to increased revenues
Democrats don’t believe that this is “inexorably” true. Certainly, this Democrat doesn’t. Rather, I believe that well-designed tax increases can and will lead to increased revenue. I also believe we’re nowhere near the point where taxes are so high that people stop bothering to generate income because the government is going to take it all anyway. Tax rates are, historically, low right now. Was the economy in the tank, and thus the potential taxable revenue base smaller, throughout the vast majority of the 20th century, when taxes were higher? Certainly, if we raised taxes to 100%, there would be virtually no revenue because almost no one would bother to make money (or taxable money, at least). But believing that raising marginal tax rates in the 20s or 30s by a few ticks would, in fact, increase revenue, doesn’t equate to a belief that this is “inexorably” true at all levels.
By contrast, many Tea Party Republicans really do seem to believe that decreasing tax rates would inexorably raise revenue. Again and again they make public statements that seem to deny the very possibility that tax hikes could ever increase revenue. So I’m afraid you’re barking up the wrong tree there.
Brendan: You must be channeling Bill Clinton. Because that’s pretty much what he said today.
Well this Republican doesn’t think that tax cuts inexorably raise revenue, but some certainly do (particularly cuts on punitively high marginal rates). JFK cut the top marginal rate from 91% to 70%, and Reagan cut it from 70% to 50%, both of which increased revenue (I believe the same also happened under Coolidge, but I don’t recall the exact numbers). How much of the revenue increase was the result of more capital investment vs removing the incentives for tax shelters is an open question, but there is no denying the historical data that cutting taxes on the wealthiest taxpayers can raise revenue. Likewise, cutting the corporate tax rate can raise revenue (see Ireland) by giving companies who can easily shift operations from one location to another less incentive to do so. These are not Republican “myths,” these are facts.
“but there is no denying the historical data that cutting taxes on the wealthiest taxpayers can raise revenue”
Sure there is, look at the Bush tax cuts on the wealthy, how well have revenues done since then? Revenues were higher under Clinton after tax rates were increased. Yes its insane to tax people at super high rates, but no one is talking about doing that.
Regardless of whether revenues dropped after the Bush tax cuts as a result of the tax cuts themselves or, say, the bursting of the stock market bubble and/or the recession, that still doesn’t disprove that cutting taxes on the wealthiest taxpayers can raise revenue. You’re just asserting that it doesn’t always happen. So?
I’m crossing my fingers that Ryan threw in the “Tax cuts for the rich” to provide a built in bargaining chip when the Senate bothered to get around to passing a budget. It’s pretty ridiculous to say we can cut revenues from current levels before making serious spending reforms.
It is also ridiculous to say that we have to increase taxes on anyone while refusing to make meaningful spending cuts – even if they come from *not* funding programs which cannot be afforded in this economy, and should not have passed Congress during this Great Recession …
Joe, the problem with free markets and healthcare is two fold.
First, most people have no idea what they “need” when it comes to health care. If the doc tells you you need a CT scan how do you know if it’s because you need a CT scan or if it’s because he is behind on his boat payment? Or statins for that matter (and just by way of example). Most people blindly believe that when the doc prescribes a statin they must really need it. Never mind that there is no study that proves it has a the ability to prevent death in the case of the vast majority of patients. There is one study that shows they work for males (if I recall between the ages of 45 and 60) ONLY. That study was likely flawed as no further study has been able to recreate even those limited results. You know how much money we, as a country, spend on statins that don’t do anything for you and have side effects that lead most people that take them to also be on sleep aids because statins screw up your sleep schedule and on Viagra because they make you impotent? I don’t know either but its a hell of a lot of meds that have a lot of chronic side effects that also need to be treated and a lot of money for basically nothing. Most consumers of medicine don’t read medical journals or any any way keep up to date on things. A lot of doctors don’t either, but that’s another problem, how are they supposed to know what they need if not to just trust the doctor.
When you buy a car you can get your self pretty informed about what you are buying and what it should cost you. Which brings me to:
Second, if the doc tells you you are going to die unless you do X you are probably going to do X regardless of how much they are going to charge you for X. If you come in in an emergency and they tell you immediately need procedure X you are going to let them do procedure X. It’s not like the auto mechanic where if there is something wrong with your car and it seems like the shop is selling you a bill of goods you can take it someplace else or shop the repair around. You literally have no other option. Cake or death. You have no control over how much that cake costs, but you’ve gotta take the cake. And if someone you care about it sick ultimately you are going to pay it. Whatever it is.
Those two problems lack of the possibility of an educated consumer base and lack of choice on the part of the consumer in terms of making a purchasing decision means that you are completely wrong. When it comes to medicine the more free market we’ve made it the more fucked we’ve gotten and the more money we spend on it.
Well I reject the premise that a reasonably educated consumer base is impossible when it comes to health care. To use your example of statins, I’ve been taking one for the last year, not to “prevent death” but to lower my total cholesterol (specifically my LDL level) because it was too high and could not be lowered to the desired level by diet and exercise alone. I somehow managed to come by this information without reading medical journals. Statins have worked fine for me (I’m not between the ages of 45 and 60) without any of the side effects you mention. Either I’m just a fortunate outlier, or you don’t really know what you’re talking about.
When it comes to my health status, I am reasonably well-informed, and I think most other people are too (but obviously not everyone). I will know if I need regular drugs for high blood pressure, high cholesterol, or arthritis, or if I’m diabetic, etc. I’ll also know if I’ve been diagnosed with cancer, or if my wife is diagnosed with Alzheimer’s, and that it will be expensive to treat these diseases. And I know that as I get older the chances of getting many diseases increase. Thus, in a free market I’ll choose a health plan with better benefits even if they cost a bit more, and so will most other people as they get older (and sicker).
When it comes to medicine the more free market we’ve made it the more fucked we’ve gotten and the more money we spend on it.
Really? Then why have the costs of elective surgery (the freest health care market), such as plastic surgery, lasik etc consistently gone down while the prices of government regulated/dominated health care continued to go up?
Dane, I have to concur with Joe here. Basically, I believe it IS possible to have a functioning health care market. I cannot stand the current system, which basically removes consumers from making any choices informed on cost (which has made much of our healthcare more expensive then it would be otherwise). I’d envision something like cars here: I take care of most of my car’s expenses, like oil changes. The insurance exists for stuff that is too expensive for me to cover out of pocket (perhaps something like health savings accounts here). Basically, I want to pay for routine doctor’s visits, dental visits, and so forth. What I want to have insurance for is if I need an ER visit out of the blue. But I think that having real people pay real money for doctors and medication would fix a lot of the problems with the system.
I also like unicorns. Which is to say I don’t see my idea ever happening, because too many people profit over us having no clue what healthcare costs.
I agree with Dane. Patients are not consumers and there are few people who wouldn’t bankrupt themselves to pay medical bills for a child, for example. The most cost effective health care systems in the world are either single payer or you could look at the German hybrid. For HALF the cost of our system, they yield similar or better results. If Ryan was serious about reducing costs, he’d look at current systems operating in similar economies that are yielding more cost effective results. But he’s not. He’d like to privatize insurance, assume based on nothing that costs will magically fall, impose low inflation marks on insurance subsidies that are far below the rise in the actual cost of insurance over the past 15 years and screw those who enter old age without a nice nest egg built up. Ryan’s plan is a disaster for the old and a disaster for the GOP. And his plan and the show vote in Congress on it will most likely prompt large Democratic victories (ala upstate NY) that will embolden Dems and their equally absurd notions that we can stay the course and the math will fix itself. Surely someone has a better plan than the Ryan plan. And since when did the GOP go from ‘cover grandma’s meds regardless of the price’ via Bush’s prescription drug plan to ‘grandma can decide whether she can afford her heart medication according to the market.’?
Moreover, I’m extremely doubtful of arguments about the brilliance of the market in fixing prices given our recent experience with the housing bubble and the fiasco surrounding it in default swaps and derivatives. Unregulated derivatives seem to be an example of an unhindered market and that market committed suicide and nearly took down the global economy.
Joe, the only reason to reduce your cholesterol is to prevent death from diseases that have been shown to corollate with high LDL cholesterol otherwise you are dicking around with your blood chemistry for no reason. If all statins do is lower your cholesterol (which they do do that part is true) but do not improve long term outcomes then all you are doing is treating a symptom of a larger problem but in treating if in treating that symptom you are both masking an indicator that would show you your actual health status and not actually improving your long term prognosis, and, depending on what kind of LDL you have, possibly damaging a standard body response to the health problems you are trying to prevent by lowering your cholesterol. So really, what’s the point of taking the stuff? Especially given the nasty side effects that require more drugs and have more side effects?
Now, as I’ve already pointed out, there is only one, non-repetable, study that has shown any benefit of OUTCOME for statins. And the only cohort in that study to have that outcome was a subset of the male cohort which in that particular study was relatively small in statistical terms. And, again that benefit of outcome has not proven to be repeatable.
For much much more on statins with citations and everything:
http://thehealthyskeptic.org/statins
Which comes to the point, people don’t know what they are buying or why when they get medicine they rely on their doc to do the right thing. And the docs docs rely on the drug company reps. who have a desire to sell more drugs.
As far as health problems go, there seem to be two things you can do that are really fairly easy relatively cheep and you can do right away that will make a big difference quite quickly. First, get enough vitamin D. Preferably from sensible un-protected sun exposure. IE about half the amount of time it would take you to burn. Using sun screen prevents your skin from being able to make vitamin d. You can supplement, but your skin seems to produce other things besides just vitamin d from the sun exposure that are harder to isolate but do appear to be beneficial. Also, sufficient sunlight exposure is a natural mood enhancer and improves sleep patterns.
(for more, check out: The Vitamin D Solution.
And the second thing you can do is stop consuming added sugar. For more there is Sugar: The Bitter Truth
Are you still sure you were an educated consumer? Or have you proved my point?
G. There is a difference between an elective procedure and a non elective one. In first case you walk into a jewelry store to look at watches and decide to buy one. In the second case someone points a gun at your head outside the store and tells you to give them your watch.
B. your point isn’t completely un-reasnoble, I’d even say it’s rather compelling. The problem is unlike taking your car to the mechanic or a number of other things half the time you don’t know better and more importantly your doctor doesn’t necessarily know better either. Like did you know that the Atkins (or Atkins like) diets have been shown to do a better job at improving overall lipid profiles than statins? One of those studies was sponsored by the American Heart Association, and was buried when they didn’t get the result they wanted. More Lustig Our health system is flawed at a fundamental level. We are disastrously ill equipped to handle the “diseases of civilization” and the more we try the more fracked our health gets. Sure trauma we are good at handling and people also have a rough understanding of it. We also do well with bacterial infections, people are getting better at taking all the antibiotics. We do okay handling viral infections with vaccination. But auto-immunin disorders, cancer, heart disease, diabetes, and other chronic illnesses? That’s both where the big money goes and where we are basically shooting blind in the dark half the time.
DAMN YOU Big Pharma and all those sell outs with their MDs … all I need do to stave off atherosclerosis is worship Sol and snag artificial sweeteners? Done and done!
Artificial sweeteners are worse. But I’m guessing you are being sarcastic.
Modern medicine is all fine and good, it’s saved my life more than once.
What I’m trying to say is don’t short circuit the way your body works or you run into, well, all the problems most people in our modern society suffer from. Supporting the way your body naturally works and you will be healthier.
Here’s an article from the NYT about waste in medicare: http://www.nytimes.com/2011/05/26/opinion/26redberg.html?src=me&ref=general
If we could have a mature conversation about necessary procedures without the Sarah Palins of the world screaming ‘death panel!’ we might be able to help the system we have now. Ryan’s plan throws the baby out with the bathwater and says that patients should be consumers. I think that’s stupid, for reasons that I believe Dane has illuminated above. I can’t determine whether I should have a vitamin K shot after delivering a baby when I’m heavily bleeding in a recovery room. However, a panel of doctors with available research should be able to determine in advance whether that $2 shot will save my life or irreparably harm me. When it’s a matter of $100,000 cardiac implants paid for with taxpayer dollars, perhaps we should be relying on statistics and expertise rather than on individual providers, some of whom will perform any procedure regardless of risk or efficacy as long as it means they are being paid.
Brendan, your post unintentionally bolsters my point that the Republicans are right to use the debt ceiling to force a mini-crisis today before entitlements truly go off the rails and we’re faced with a shit-storm in the not-so-distant future. Making the Democrats commit to a serious negotiation on entitlement reform is absolutely worth holding US debtholders hostage over.
You’re conflating two separate issues. I’m not going to bother responding substantively to the tax cut portion, I’m just going to point out that it has zero to do with the Medicare debate. Medicare goes insolvent in 2024; more likely, after Obamacare’s drastic cuts to Medicare reimbursements are reversed due to their massive political unpopularity, that insolvency date is 2019. We simply cannot finance Medicare once the retiree population doubles from 35M to 70M over the next decade; the ratio of retirees, their longer lifespans, and their ballooning medical costs to fewer doctors, hospitals, and taxpayers means Medicare will come crashing down unless we do something very drastic. With a few minor tweaks, Ryan’s Medicare plan is a very smart prescription and sets the program back on the path of sustainability. In any case, on what basis are the poor and needy shouldering the burden for anything They are largely exempt from income taxes, they receive Medicaid support, and they’ll continue to have healthcare coverage in their elder years if and when we are forced to means-test Medicare. Your claim is spurious and has no basis in facts or empirical data. When it comes to righting the Medicare ship, Obamacare is the only “fundamentally unserious” proposal on the table (and it has already become law, so there you go — it’s that much worse.
dcl, I was incredibly disappointed when my boss voted for the Rx Bill back in 2003, but at the end of the day, the concept of medical coverage for retirees with zero prescription drug coverage in the 21st century is ludicrous — most medical response these days boils down to treatment with drugs. At least Part D has cost less over time than forecasted — how many other pieces of legislation can you say that about?!?
As far as controlling healthcare costs with market forces, all of you are missing the point. Ryan’s plan doesn’t introduce market forces at point purchases of medical care, it introduces market forces at the selection of a private insurance policy. While I certainly believe a wise healthcare consumer can reduce his medical costs (in fact, I personally know this to be true, because I have had a high-deductible PPO w/ HSA healthcare plan for the past five years, and that ability to make smart consumer choices is why I have over $5,000 in a tax-free HSA account versus being lost to premiums and additional consumption), the real point is that government-subsidized one-size-fits-all fee-for-service healthcare system has zero restraint on the costs of healthcare at either a micro or a macro level. Moving retirees into HMO, PPO, and HSA plans of their own choosing will mean the average retiree will have a healthcare insurance plan more suited to his or her individual needs, all the while costing the taxpayer less.