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We are now at 757 days since the Democrats have chosen to perform one of their core job functions and pass a budget. Yesterday, the Senate held a vote on four different budget proposals, including President Obama's, Pat Toomey's, and Rand Paul's.
Dean Clancy has already done the breakdown:
The Senate voted on 4 budget plans, offered by:
- President Obama
- Rep. Paul Ryan (R-WI) [This plan passed the House last month.]
- Sen. Pat Toomey (R-PA)
- Sen. Rand Paul (R-KY)
FreedomWorks supported the 3 alternatives to the Obama budget.
The Obama Budget (failed 0-97) was the biggest loser. It wouldn’t cut spending, reform entitlements, or shrink government, but would raises taxes on the middle class.
The House-Passed Budget (defeated 40-57), which would reduce spending by nearly $6 trillion over the next decade, did more respectably, garnering 40 votes in favor, to 57 against. All Democrats voted against it, along with 5 Republicans: Scott Brown (R-MA); Susan Collins (R-ME); Olympia Snowe (R-ME); Lisa Murkowski (R-AK); and Rand Paul (R-KY) [Mr. Paul opposed it because it didn’t go far enough].
The Toomey Budget (defeated 42-55) garnered 2 more votes than the House budget, picking up the liberal Murkowski (because it didn’t offer specific entitlement reforms) and the libertarian Paul (because it balances the budget in 10 years instead of 30 years as in the House-passed plan).
The Rand Paul Budget (defeated 7-90) was the boldest plan, balancing the budget in just 5 years, and eliminating 4 cabinet departments (HUD, Commerce, Energy, and Education). Voting against it were all Democrats and all but 7 Republicans. The Principled Seven were: Tom Coburn (R-OK); Jim DeMint (R-SC); David Vitter (R-LA); Mike Lee (R-UT); Orrin Hatch (R-UT); Rand Paul (R-KY); Mitch McConnell (R-KY).
Current Score: Republicans 40, Obama 0
At least the Democrats are giving voters a clear choice. Continue spending without a plan, or acknowledge that the path we're on is just not an option for much longer. Democrats have consistently failed to produce a budget option, in what is probably an effort to avoid being held accountable for their actions.
Republicans offered three options yesterday, and not a single Democrat was willing to compromise. For all of the rhetoric about getting our "fiscal house in order," they seem to be sitting on the sidelines and continuing business as usual.
Let us know how that works out for you, guys. The American people are watching. It's time to straighten things out. If you don't do it now, you'll be replaced next year by someone who will.
Who's the "Party of No" now?
Make sure to tune in to the short update from Dean Clancy on the specifics of yesterday's fight by clicking below!
One would have hoped that after a couple of weeks the overblown brouhaha over the consequences of the sequestration cuts would have died down, but alas, there are those still insistent that the meager $85 billion in cuts will somehow result in a cataclysmic shock to the American economy.
Hysterical bloggers, columnists and commentators continue to assert that these cuts will devastate everything from national defense, to air travel, to education, to health care, to the environment itself.
With all this fuss, it’s easy to lose perspective on how small these cuts really are from a historical perspective. For example, the federal budget outlays for fiscal year 2011 were a full $200 billion dollars less than those projected for 2013. If the loss of $85 billion is such an economic and ecologic disaster, one shudders to think of the barbarous dark age that those poor people in 2011 must have experienced.
The point, of course, is that all this overwrought hand-wringing is utter nonsense. 2011 was not a year of military defenselessness, nor of especial illiteracy, nor of ecological collapse. Planes did not cease to fly and cancer patients were not suddenly stripped of their health care. In short, nothing alarming happened at all as a result of the inadequacy of $3.6 trillion in federal spending.
The extent of the inconvenience to taxpayers of these cuts is determined solely by deliberate allocation of them to the most visible and popular services, such as the much lamented cancellation of White House tours, as well as the decision to release hundreds of prisoners into the general population, a political stunt that is as irresponsible as it is tasteless.
The implicit claim being made is that America is no longer able to stand on its own two legs without constantly increasing levels of federal spending, that the country has become so fragile and dependent on government that even the smallest cuts send it spiraling into chaos and desolation. As depressing as this claim is, we can take solace in the fact that it is far from credible. This is still a great country, filled with millions of independent, intelligent citizens fully capable of mastering their own destinies. The idea that the country cannot survive a return to spending levels of less than two years ago is at once insulting to the citizenry and a sad commentary on the mentality of dependency which those in power have so feverishly tried to thrust upon us.
One would have hoped that after a couple of weeks the overblown brouhaha over the consequences of the sequestration cuts would have died down, but alas, there are those still insistent that the meager $85 billion in cuts will somehow result in a cataclysmic shock to the American economy.
With budgets on the floor of both chambers this week, here's a quick breakdown of the key points for the two main proposals:
House: Paul Ryan Budget (The Good) - H.Con.Res. 25
House: Paul Ryan Budget (The Bad)
Senate: Patty Murray Budget (The Ugly) - S.Con.Res. 8
The Conclusions: Ryan's budget successfully balances in 10 years, and otherwise maintains the best features of his previous budgets. However, he balances the budget on the backs of the massive tax increases enacted by President Obama in 2013, which places a bit of an asterisk on his 10-year number.
The Senate Democrats' budget completely misses the mark, massively increasing taxes and continuing to run 12-figure deficits in perpetuity. By that reckoning, it may be that the Senate budget is actually worse than no budget at all.
These two budgets are the main players, but stay tuned for updates on other proposals, including from the Republican Study Committee in the House and from Senator Rand Paul in the Senate.
With budgets on the floor of both chambers this week, here's a quick breakdown of the key points for the two main proposals:House: Paul Ryan Budget (The Good) - H.Con.Res. 25
Looking for information on Paul Ryan's budget plans and the "Ryan Roadmap?" Look no further.
We've compiled this list of links to help activists, bloggers, and journalists learn more about the policy vision of Paul Ryan, the young conservative and legislative entrepreneur whom Mitt Romney has chosen as his running mate.
The three basic iterations of the Roadmap are presented in reverse chronological order, from newest to oldest.
ROADMAP 3.0 (112th Congress) (FY 2013 House Budget Resolution) (2012)
The third distinct iteration of the Ryan Roadmap looked much like the second, but modified the Medicare reform section to preserve original, 1960s Medicare alongside Ryan's proposed new, competitive ("premium support") model, which would compete with private plans for seniors' business in a new Medicare "exchange" managed by the Medicare agency. (This approach is sometimes called "Wyden-Ryan," for its two co-authors Sen. Ron Wyden (D-Oregon) and Rep. Paul Ryan (R-Wisconsin).)
The plan also waived the current-law Budget Control Act sequester and in its stead increased defense spending by roughly $700 billion over ten years, relative to current law, while reducing annually appropriated non-defense spending by roughly $800 billion.
The plan would save about $4 trillion over ten years (2013-2022), out of a projected roughly $44 trillion in ten-year spending. It would reduce federal outlays to about 20 percent of GDP, down from about 24 percent today. And it would reduce publicly held debt to about 62 percent of GDP, down from nearly 80 percent today.
Roadmap 3.0 passed the House in the form of H.Con.Res.112 on March 29, 2012, by a vote of 228 to 191. Ten House Republicans voted against the resolution. No House Democrats voted for it. A more fiscally conservative alternative was also offered, by the House conservative caucus, the Republican Study Committee; but it failed.
The Senate rejected Roadmap 3.0 (H.Con.Res.112) on May 16, 2012, by a vote of 58 to 41. Five Senate Republicans voted against the resolution. No Senate Democrats voted for it. Three more fiscally conservative plans were also offered, by Senators Pat Toomey (R-Pennsylvania), Rand Paul (R-Kentucky), and Mike Lee (R-Utah); but all three failed. Senate Democrats did not offer a budget plan of their own.
Detailed summary with graphs: Ryan FY 2013 budget plan (Bipartisan Policy Center) - 2012-08-12
How they voted: Senate vote on H.Con.Res.112 (Ryan budget) - Govtrack - 2012-05-16
Report Card: Rand Paul "Tea Party Budget" = Best in Class (FreedomWorks graphic) - 2012-05-15
How they voted: House vote on H.Con.Res.112 (Ryan budget) - Govtrack - 2012-03-29
ROADMAP 2.0 (112th Congress) (FY 2012 House Budget Resolution) (2011)
The second distinct iteration of the Roadmap -- introduced after Republicans had taken control of the House and Ryan had become chairman of the House Budget Committee -- differed from the first interation in several key ways. It added a provision to fully repeal ObamaCare (which had been enacted in March 2010), and it dropped universal health insurance tax credits, Social Security personal accounts, and the increase in the Social Security retirement age.
Roadmap 2.0 also largely exempted defense from spending reductions. The bulk of the plan's first-ten-year savings, therefore, came from three sources: Medicare (which then represented 13 percent of the federal budget); Medicaid (8 percent); and domestic discretionary spending (19 percent). Thus, 40 percent of the budget pie was targeted to produce 100 percent of the plan's first-ten-year savings.
Like the ObamaCare law, Roadmap 2.0 proposed to reduce Medicare spending by $500 billion over the first ten years, although notably by means of Ryan's "managed competition" reform rather than the Democrats' across-the-board Medicare payment cuts and bureaucratic rationing. The Medicare reform in Roadmap 2.0 was largely unchanged from its predecessors; but once all House Republicans voted for it, it immediately became the object of intense attack by Democrats, who (misleadingly) accused Republicans of "ending Medicare as we know it" and (falsely) of "ending the Medicare guarantee."
The plan would save about $5.8 trillion over ten years (2012-2021), out of a projected roughly $46 trillion in ten-year spending. It would reduce federal outlays to about 20 percent of GDP, down from about 24 percent today. And it would reduce publicly held debt to about 70 percent of GDP, down from nearly 80 percent today.
The income tax portion of the plan was thoroughly overhauled. Both the taxpayer choice provision for individuals and the VAT-like consumption tax for corporations were dropped. In their place, the plan generally described an individual and corporate income tax system that would be simpler and flatter than the existing code, with a top rate in both systems of no more than 25 percent. To avoid losing revenue, the plan assumed the elimination of numerous tax credits, deductions, and exemptions, but did not specify which ones. Mathematically speaking, to achieve a 25 percent top rate, virtually all existing credits, deductions, and exemptions would have to go.
Roadmap 2.0 passed the House in the form of the bill H.Con.Res.34, popularly known as the Ryan Budget, on April 15, 2011, by a vote of 235 to 193. Four House Republicans voted against the resolution. No House Democrats voted for it. A more fiscally conservative alternative was offered, by the House conservative caucus, the Republican Study Committee; but it failed.
The Senate rejected Roadmap 2.0 (H.Con.Res.34) on May 25, 2011, by a vote of 57 to 40. Five Senate Republicans voted against the resolution. No Senate Democrats voted for it. Two more fiscally conservative alternatives were also offered, by Senators Pat Toomey (R-Pennsylvania) and Rand Paul (R-Kentucky); both alternatives failed. Senate Democrats did not offer a budget plan of their own.
Report Card: Grading the Budget Plans (FreedomWorks graphic) - 2011-05-26
How they voted: Senate vote on H.Con.Res.34 (Ryan budget) - Govtrack - 2011-05-25
How they voted: House vote on H.Con.Res.34 (Ryan budget) - Govtrack - 2011-04-15
H.Con.Res.34 (FY 2012 House Budget Resolution) (final legislative text) - GPO - 2011-04-15
H.Con.Res.34 (112th Congress) (Ryan budget for FY 2012) - Govtrack - 2011-04-15
The Path to Prosperity: Restoring America's Promise (PDF document) - 2011-03
The Path to Prosperity: Restoring America's Promise (resources page) - 2011-03
"Ryan Roadmap Plan 2.0" (Ryan budget for FY 2012) (legislative summary) - 2011
ROADMAP 1.1 (111th Congress) (Legislative Proposal) (2010)
Roadmap 1.1, introduced in 2010, looked much like its predecessor, but added provisions to: 1) raise the Medicare retirement age to 69.5 by 2021; 2) index future increases in the Social Security retirement age to grow with projected lifespans, thus likely increasing it to age 70 by the year 2100.
H.R.4529 (111th Congress) Roadmap for America's Future Act of 2010 - Govtrack - 2010-01-27
ROADMAP 1.0 (110th Congress) (Legislative Proposal) (2008)
The original Ryan Roadmap -- introduced in 2008, when Democrats controlled the House and Senate -- included a number of bold reforms to reduce spending and avert America's entirely foreseeable debt crisis. It constituted a comprehensive, integrated package, unified by an optimistic, conservative vision. Its reforms included the following: Accelerate the currently scheduled increase in the Social Security retirement age to 67, by 2021. For seniors aged 55 and under, gradually reduce the future growth of promised Social Security benefits (more so for higher-income retirees than for lower-income ones). Create optional Social Security personal accounts. Modernize Medicare into a competitive "premium support" model based on the existing Medicare Advantage program, for seniors then aged 55 and under, beginning in 2022. Block-grant Medicaid and SCHIP back to the states. Convert the existing tax-code subsidy for employer-provided health benefits into a "managed competition" system of universal health insurance tax credits coupled with health care "exchanges" and certain federal regulations. Establish spending reductions targets, to be enforced by sequesters (automatic, across-the-board spending reductions, should the caps be exceeded). The plan also overhauled the tax code, in two ways. It transformed the individual income tax into a Taxpayer Choice system, allowing taxpayers to choose between paying their income taxes under the existing tax code or under an alternative, simpler, flat-rate system. And it replaced the existing corporate income tax with a new, VAT-like consumption tax. The plan assumed that future tax revenues will remain indefinitely in the range of 18 to 19 percent of GDP.
Roadmap 1.0 did not specify any agencies for elimination. Nor did it balance the budget, except in the distant future, under certain optimistic assumptions. But it did reduce long-term borrowing sufficiently to forecast a spectacular reduction in the national debt as a share of national output, relative to current law, over the next four decades.
H.R.6110 (110th Congress) Roadmap for America's Future Act of 2008 - Govtrack - 2008-05-21
Looking for information on Paul Ryan's budget plans and the "Ryan Roadmap?" Look no further.
If the Supreme Court strikes down the individual mandate, what next?
My prediction is the mandate could very easily rise from the grave in a new form, namely, the "conservative" idea of giving everybody a new universal health care tax credit, coupled with a policy called "auto-enrollment."
I call it a soft mandate, and it’s arguably as bad as the original.
Dean Clancy is FreedomWorks’ Legislative Counsel and Vice President, Health Care Policy.
Hi, I’m Dean Clancy in Washington, and it’s Tuesday, April 10, 2012. And I want to talk today about health care, and specifically about the individual mandate to purchase health insurance.
What happens if the ObamaCare mandate is struck down by the Supreme Court? What will the Democrats do? What will the Republicans do? Where does the debate go, if the mandate goes? How will it affect the elections?
Here’s my prediction. I think it’s quite possible the individual mandate will rise from the grave in a new form. And I’m worried that both political parties, for their own reasons, will conspire to make this happen. Specifically, what I’m worried about is a coalescence of the Left and Right around the idea of giving everybody a new universal health insurance tax credit, coupled with a policy called auto-enrollment. There would be no mandate, formally speaking, but the effect would be similar. I call it a soft mandate, and it’s arguably as bad as the mandate. But about that, more in a second.
At the start here, I just want to clarify that I’m assuming for this discussion that the Supreme Court strikes down only the mandate. It could do something else -- strike other parts of the law as well, or the entire law, or it could uphold the entire law. We won’t know till late June, early July, when they announce their decision. But for this discussion, let’s assume only the mandate goes away and the rest of the law stays in place.
And let’s just remind ourselves of what would still be in place. It’s a 2,801-page law. There’s a lot of stuff in there. For example, you’d still have the employer mandate, which is the requirement on employers to offer insurance to their workers. You’d still have the mandatory, government-defined benefits package, complete with coverage of contraceptives and so-called reproductive health services, that we’ve heard about in the news. You’d still have the exchanges, those pseudo-marketplaces where people will go to get their government-subsidized health coverage -- the premium subsidies would be through the tax system. And you’d still have the two big mandates on the insurance companies, which are known as guaranteed issue and community rating. Basically, those say that the insurer has to cover everyone -- who has pre-existing medical conditions, for example -- and they’d have to charge everyone the same price regardless of their health status. And of course, your kids will still be able to stay on your insurance policy until they’re 26. Oh, and by the way, there’s also the big Medicaid expansion in the bill, and the $500 billion in ten-year Medicare cuts, and the 15-member un-elected Medicare rationing board, and all the new taxes -- I mean, it goes on and on. There’s a lot in this law besides just the mandate.
And if the mandate goes away, all that’s still there -- but the whole picture will change.
Without a mechanism to force us all into the system, those insurance mandates -- guaranteed issue and community rating -- will actually cause insurance premiums to go up, and that’ll cause people to start dropping their coverage, waiting till they get sick to get insurance -- pretty soon you’ll have what the experts call a health insurance death spiral. The whole scheme will go kaput. And the number of uninsured will go up, and of course that’s the very opposite of what the law’s authors said they were trying to do, namely, achieve “universal coverage.” All of that would happen just from deleting that one thing, the mandate.
So if that happens, what are the folks in Congress going to do do -- what are they going to say? Here’s what I predict.
First of all, the Democrats. They’re going to minimize their defeat. They’re going to say, “Well, it’s not so bad. The bulk of the law survived. We just need to come up with a replacement for the mandate. We just need to find a way to encourage people to buy insurance voluntarily, so we can avert that death spiral. And frankly there are a bunch of ways we could do that.” And then what they’ll do is they’ll mention four possible options, which they’ve been discussing in print. And those are, first of all, you could just have a new payroll tax, second a late penalty, third an irrevocable opt-out, and fourth, auto-enrollment (remember that term, we’re going to come back to it).
Now, let me take just a second here to clarify what those four policies would actually do.
First of all, the payroll tax. That’s just like what we have for Medicare and Social Security -- money coming out of your paycheck. My guess is the ObamaCare payroll tax, if they create it, would equal about 8 to 10 percent of your wages. And of course, that would be on top of the 15 percent of your compensation you’re already paying in FICA taxes (I’m folding both the employer and employee shares into one number here). And we know the Supreme Court’s going to find that constitutional, ‘cause they already have. So that would be very straightforward. But it would also be hard to get through Congress, because who wants new taxes?
Now, the second idea is a late penalty. And basically how that would work is -- let’s say you decide not to buy insurance, but later you change your mind. Okay, you can come in now; but for every year you’ve tarried, we’re going to charge you an extra 10 percent each month for the rest of your life. And by the way, that’s how they do it in Medicare Part B. It’s nominally optional, but it’s really basically mandatory: 98 percent of seniors sign up for Part B because of that pretty stiff late penalty. You could do that with ObamaCare.
Third idea, irrevocable opt-out. And what that means is you sign a piece of paper saying, “I don’t want to participate in this government health care system. I want to be out of the system, thanks very much.” And that’s irrevocable. You’re out, forever. Or more likely, what they would do is they would give you a chance, say, every five years, if you change your mind, to come in without penalty. And my guess is they’d also allow special times to come in, if you have a serious hardship or something. But otherwise, you would be on your own. I’m not sure the idea will work, but it’s out there.
And fourth, there’s auto-enrollment. And basically that means that either the government or your employer will automatically enroll you in an insurance plan, but you can opt-out if you really want out. And that’s the gentlest of the four options. And I predict that that’s the one you’re going to see talked about the most, if the mandate goes.
The reason the liberals will prefer auto-enrollment is that, of all these fallback options, none of which is appealing to them, the auto-enrollment at least will cover more people than the others. So with the mandate 32 million people would get covered in the year 2019. Without the mandate, only 16 million, or half. But with auto-enrollment, you would get up to 24 million. So from the Left’s perspective, that would be better than nothing.
But one thing to keep in mind is these four options that I’ve mentioned are not mutually exclusive. In fact, you could combine all of them, if you wanted. You could have auto-enrollment, plus a five-year irrevocable opt-out, plus a 10 percent-a-year late penalty, plus a new 10 percent payroll tax. You could do all of that. And don’t you just know the Democrats are gonna select “All of the above”?
But anyway, so much for the Democrats. Let’s talk about the Republicans. All right, here’s what I think they’ll say. They’ll say, “Hey, ending the mandate is a huge vindication for us -- a big victory. We said this was unconstitutional. The Supreme Court agrees. We told you so. But we can’t stop here. We need to repeal ObamaCare in its entirety. And we also need to fix our health care system, the right way. We’ve got a bunch of ideas for doing that.”
And they do. The Republicans do have a bunch of ideas for fixing what ails our health care system. I’ll just mention a few of them here. For example:
Here’s my personal favorite:
Those are just some of the ideas that various Republicans have proposed. And they’re by and large pretty good, common-sense ideas. I think they’d reduce costs without costly mandates, without a big new bureaucracy, without a 2,801-page bill that “they have to pass so we can find out what’s in it.” Oh, and by the way, with all of these ideas, you would actually get to “keep your coverage if you like it,” unlike under the president’s plan. Anyway, that’s all great.
But the one problem that I haven’t mentioned the Republicans dealing with -- and it’s very important -- is pre-existing conditions. You probably know what that is. It’s the most important problem in health care. If you fix the problem of pre-existing medical conditions, I think you fix the health care issue, as a general matter.
What is that, exactly? It’s the problem you face when, let’s say you have diabetes and you’re unemployed or you lose your job -- you have no health insurance. So you go to buy coverage online or out of the yellow pages, and they want to charge you an arm and a leg because of your health status, because of your preexisting condition. That’s a problem for a lot of people, maybe 2 to 4 million people in this country, so not a huge percentage of us, but for each one of those people it’s a big deal.
And guess what? That problem can be addressed. It’s mainly caused by government policy. My line is whenever someone tells you that there’s a “market failure,” look closer: it’s a government failure. There’s some government policy causing the problem. And that’s definitely the case here. The problem with pre-existing conditions is primarily caused by the United States tax code. That’s right, it’s the tax code. And how does that happen? Well, basically the government doesn’t create a level playing field for health care versus health insurance, for health insurance obtained at the workplace versus health insurance obtained out of the yellow pages, for health insurance that has a low deductible versus health insurance with a high deductible. By the way, a deductible just means the amount that you pay out of pocket before the insurance kicks in. All of those distortions are caused by the way we treat health benefits in our tax code.
So the Republicans are aware of this, and they want to do something about it. Democrats don’t like to talk about it; they would rather have a government system. But the Republicans know they need to do something. And their main ideas for doing it -- and here we’re circling back now to where I started, with tax credits -- their main ideas are tax credits and tax deductions. And the difference between these is a credit is like a voucher you could take and you could use it to buy a health insurance policy from a private company. A tax deduction would be something you could use for medical expenses out of pocket. So you just deduct those off your taxes. And that’s really good for people who have high medical expenses, people with chronic illnesses and so on. And these two policies are not mutually exclusive. You could have a tax-credit system to help everybody buy into the insurance system, and you could also have deductions for people with high medical expenses. In fact, we already have that deduction, but it has to be such a huge percentage of your income, most people can’t access it. You could liberalize that, and I think you should.
But the point of all this is that if you have a tax credit, you are in effect creating what I would call a kind of soft mandate. How is that? Well, if the tax credit is, let’s say, $5,000, then if you didn’t take the credit, you would in effect be paying a $5,000 tax penalty. It’s a carrot rather than a stick, but the effect is similar to a mandate. And that’s probably tolerable, because it is optional. But what if you combined that with auto-enrollment? Now you’re really putting a lot of pressure on people to get covered.
And that’s why I think the Democrats are going to seize on this idea, which will probably be presented as a Republican idea: tax credits plus auto-enrollment.
The idea was originated by the conservative Heritage Foundation in Washington. And if you’ve not heard of them before, they were the same folks who originated the individual mandate and the idea of exchanges and applying guaranteed issue and community rating to insurance purchased with universal tax credits. That whole system, which is similar to ObamaCare, started with the conservative Heritage Foundation. Originally, the liberals didn’t like it at all, and over time they’ve come basically to embrace it, whereas conservatives were split on it back in the early ‘90s during the HillaryCare debate, and over time they’ve come to oppose the individual mandate very strongly. So Heritage has backed off on that. They’ve also dropped the exchanges, which have become controversial. But they’ve retained the idea of the tax credits. And they’ve adopted this new idea of auto-enrollment. It’s sort of, as I say, a soft mandate.
So the Heritage plan, which is the model for ObamaCare, turns out to still be there, in a new guise. And that’s a problem, because if we go there, in the wake of the mandate falling, then I think you’ll see ObamaCare, in effect, resurrected. We shouldn’t do that.*
The problem with these kinds of approaches is they’re focused on the wrong goal. They’re focused on the goal of increasing coverage or “universal coverage.” Instead the goal should be costs -- lower costs -- and expanding individual freedom, helping patients to function more like consumers. Health care can be a functioning marketplace like any other, if you let it. And its problems, as I mentioned, are primarily caused by existing government policies -- the tax code, red tape, federal regulations, trial lawyers, and a lot of problems that can be addressed by letting the system work as it would naturally.
And incidentally, the [tax credits plus auto-enrollment] idea is to replace the existing employer-based system with these tax credit vouchers. That would disrupt coverage for a lot of people. It would be very un-conservative, to the extent you didn’t let people keep what they were used to and like.
So [my advice is] focus on costs rather than coverage. Don’t disrupt the employer-based system. And leave individuals free to make their own choices with their doctors and loved ones.
That’s free-market, patient-centered health care reform. That’s what we need to be doing.
I think to address the tax-code problem what you need is that deductibility that I talked about, combined with all those other [Republican] reforms that I mentioned. And you would have, I think, a very robust health care reform program.
And I would also say, on a last note, don’t put it all together in one big bill, and don’t force people to read it after you’ve passed it. Take your time. Do it piece by piece. Debate it. Deliberate on it. Think about it. And let the people know what you’re doing. And if you do that, then you’re going to end up with a great health care system, and you’re not going to have this nightmare of ObamaCare.
So that’s it. Auto-enrollment plus tax credits? Not such a great idea. But maybe we can stop that.
Remember, government goes to those who show up -- so show up. And thanks for listening.
Dean Clancy is FreedomWorks' Legislative Counsel and Vice President, Health Care Policy. He leads our efforts to replace the government takeover of health care with a patient-centered system.
*Update, April 27, 2012: Since this broadcast, I've been told by a person who's close to the Heritage Foundation that the think tank has never in fact formally endorsed "tax credits + auto-enrollment." I'm delighted to hear this, for the reasons I gave in my radio talk. But I'm still a little confused, since Heritage's comprehensive Saving the American Dream budget plan specifically mentions both tax credits and auto-enrollment, and one of Heritage's leading policy thinkers also seems to endorse the concept in a recent opinion piece in USA Today. Clarification would be helpful.
[Note: This post was first published on April 10, 2012. I've reposted it for those who are following the Supreme Court's health care ruling, widely expected to be handed down tomorrow, June 28th.]
Click here to listen! If the Supreme Court strikes down the individual mandate, what next? My prediction is the mandate could very easily rise from the grave in a new form, namely, the "conservative" idea of giving everybody a new universal health care tax credit, coupled with a policy called "auto-enrollment." I call it a soft mandate, and it’s arguably as bad as the original.
Hey, Republican congressmen: I’m calling you out. Challenging you. I’m wondering how many of you have a spine. Or some guts. Let me ask you all a few questions:
• Do you believe in following the Constitution?
• Do you believe in limited government?
• Do you believe in fiscal conservatism?
I bet that if you asked each and every Republican in Congress these questions, they would answer, “Of course! I’m offended you would ask me that! Don’t you realize that I’m a true conservative?”
If that’s the case, here’s a follow-up question: Why are you settling?
Let me explain. Right now, the two most important debates in American politics revolve around health care reform and the federal budget. The outcome of these debates will determine our nation’s future. Representative Paul Ryan (R-WI) is fond of saying that America faces a choice of two futures: Greater freedom and prosperity, or greater debt and decline. However, I would suggest that our most likely future is stagnation.
Most Republicans in Congress are happy to attack Democratic programs, but few are willing to step forward with their own proposals. Legislators such as Senator Rand Paul (R-KY) with his “Platform to Revitalize America” budget and Representative Paul Broun (R-GA) with his “Patient OPTION Act” ObamaCare replacement bill are the exceptions, not the rule. By and large, Republicans appear content to play a spirited defense instead of an aggressive offense on policy.
This is the path to stagnation, and it has to stop. To be fair, Republicans are coalescing around a few bills, such as Paul Ryan’s “Path to Prosperity” budget. Unfortunately, most of the proposals that Republicans sign on to are compromise bills, in essence. The Ryan budget is full of compromises, such as the Medicare reform package that he co-authored with liberal Senator Ron Wyden (D-OR). That’s why it doesn’t abolish any departments. That’s why it doesn’t balance the budget for nearly thirty years.
Better proposals are out there. Senator Paul’s budget balances in only five years. Representative Broun’s bill implements a comprehensive set of reforms that create a patient-centered health care system. So, where’s the support?
Here’s where the Republicans in Congress start to get a little nervous. They shuffle their feet, they squirm in their seats. They sweat a little. They whisper furtively, “You see, I would love to support bills like that. But, my colleagues… The political realities are, well, difficult, and complicated, you understand…”
Let’s be brave. After all, fortune favors the bold. House Republicans have spent years trying to garner even a shred of bipartisan support, and they have nothing to show for it. These simpering pleas for Democratic support are a loser’s game. The budget we give them doesn’t matter. The Paul Ryan and Rand Paul budgets will receive the same number of Democratic votes: Zero.
Americans love a bold plan. Incrementalism and overt caution are anathema to the American psyche. When we act like us, we win. When we act like them, we lose. The Tea Party takeover of the Republican Party allowed conservatives to make incredible electoral gains in 2010. Why is that? The Tea Party wanted to restore limited, constitutional government, and the American people turned out in droves to affirm their faith in that vision.
It appears that Republicans will keep the House and have a strong shot at winning a Senate majority. Moving forward, we must make grand proposals such as Rand Paul’s budget and Paul Broun’s health care bill the centerpieces of the conservative agenda. Here again the Republicans in Congress urge caution, plead for restraint, murmuring, “Even with majorities, the Democrats can still filibuster. We have to work with them, we have to craft bipartisan solutions, don't you see?”
Let them filibuster. In fact, make them filibuster. Most Americans don’t realize that Senators don’t actually filibuster anymore. They just threaten to do so, and the other party heeds their warning and either drops their proposal or manages to scrape together sixty votes to bypass it. If the left wants to stand in the way of a budget proposal that prevents national bankruptcy, or a health care reform plan that lowers costs and empowers patients, let them. Make them stand and filibuster for two years. They won’t do it, they won’t last. Either they’ll come to the table to negotiate, or they’ll let the bills pass eventually.
Budgets and health care reform are so critical, so comprehensive, that this is a war worth waging. We must emphasize principle over short-term political games. If the left can rally to ram ObamaCare down the throats of the American people, why can’t conservatives unite to roll back an overreaching federal government and to fix a broken health care system?
If you’re still hesitant, still worried that it might not be popular, you know what’s really unpopular? A sovereign debt crisis. Just ask Greece.
So, Republican congressmen. You’re Constitutionalists? Believers in limited government? Fiscal conservatives? Prove it.
Hey, Republican congressmen: I’m calling you out. Challenging you. I’m wondering how many of you have a spine. Or some guts. Let me ask you all a few questions: • Do you believe in following the Constitution? • Do you believe in limited government? • Do you believe in fiscal conservatism?
Representative Paul Ryan (R-WI) often insists that America faces a choice of two futures. Ryan lays out this stark choice in a video promoting his latest budget:
"Americans have a choice to make. A choice that’s going to determine our country’s future. Will it be the future that looks like the America we know? One of greater opportunity, greater prosperity? Or more of what we’re seeing today? Debt, doubt, and decline. Americans, not Washington, should decide." - Rep. Paul Ryan
He’s right. Continued growth in spending, or even stagnation in our current state of affairs, will inevitably bankrupt our nation. Alternatively, we can cut spending and reform government through a restoration of constitutional limitations and principles. While Ryan’s latest budget is imperfect, it’s an excellent first step toward the return of a free and prosperous America.
But the evolution of that plan over the past four years is troubling. Since introducing his first “Roadmap for America’s Future” in 2008, Ryan has gone to great lengths to win bipartisan support. The roadmap, now in its fourth iteration under the label of “path to prosperity,” has grown more moderate and less exciting for fiscal conservatives with each passing year. In the past, Ryan tried to implement bold, principled reform of entitlement programs. His latest budget barely touches Social Security, and his Medicare reform leaves much to be desired.
Ryan has been moving leftward. But why?
He’s a statesman, and he wants to be effective. He wants to get things done. And like a true statesman, he’s leaving no stone unturned. But he is unfortunately going about it in a problematic way. His underwhelming Medicare reform package, co-authored by Senator Ron Wyden (D-OR), is characteristic of his drive for Democratic support. He knows that as things stand today, his proposals have zero chance of passing without votes from the other side of the aisle.
That’s understandable, but it’s also misguided, because it overestimates the good faith of the other side. For Ryan, it’s about saving the country. For the political left, it’s about power. And so, under current conditions pursuing a “bipartisan” accommodation with the left becomes an exercise in futility.
There are two basic approaches to getting things done in government.
A) You can try to gain support from the other side of the aisle for your bill. B) You can stand on principle and take your case to the voters.
For minor, routine, or obviously necessary legislation, A is the easiest route. However, appealing to other legislators often requires a great deal of bargaining. Ryan (under pressure from his more squeamish GOP colleagues) has spent the last four years tirelessly pursing this method, making concession after concession in his budgets, but to no avail. In 2008, the Democrats in charge of the House Budget Committee didn’t even allow his proposal to make it out of committee.
For the past two years, however, the House of Representatives has voted to pass his budget. Did all of those concessions make the difference? Hardly. Both years, exactly zero Democrats voted yes. Indeed, Senate Democrats have even refused to take up the House-passed budgets for a vote, thereby leaving the plans to die. No, it was electoral gains that made the difference.
In effect, Ryan and the Republicans have been negotiating with themselves since 2008. The Democrats have never come to the table. Last year, Senate Majority Leader Harry Reid (D-NV) even claimed that it would be “foolish” for Democrats to propose a budget.
This is the danger of the first approach to lawmaking. It only works if both sides are in good faith. Ryan is beginning to lose the support of strong fiscal conservatives. This year, ten Republican congressmen voted against his budget. With each new move to the left, more and more conservatives will drop their support. Since the left is content with forcing ever-greater concessions without actually making any concessions of its own, losing the support of fiscal conservatives would be devastating.
To be sure, this is a difficult situation.
Thankfully, we don’t have to play their game. Instead, there is always the second option: appealing directly to the American people.
A popular FreedomWorks maxim illustrates this point: When we act like us, we win. When we act like them, we lose. Consider the last three times conservatives made major gains: Ronald Reagan’s presidential campaign in 1980, the Contract with America in 1994, and the Tea Party revolution in 2010. In all three instances, conservatives ran as, well, conservatives. We ran on the principles of fiscal conservatism and constitutionally limited government.
When Republicans nominated the fiscally liberal Senator John McCain (R-AZ) for president in 2008, conservative Americans simply didn’t show up, and President Obama won in an absolute landslide. Which calls to mind another FreedomWorks maxim: Government goes to those who show up. Conservative leaders such as Paul Ryan must give people a reason to show up, however, and a budget that never really balances and eliminates no cabinet departments isn’t the way to do it.
Sure, on some level we obviously have to negotiate with lawmakers on the left. However, we must also stand on our principles. When we act like us, we win the support of the American people. We need to campaign on the message of liberty, on fiscal responsibility and the wisdom of the Founders’ Constitution. A sincere appeal to the message of liberty will always reach the hearts and minds of the American people.
So, now it’s Ryan and his fellow Republicans who teeter on the brink. They are the ones who face a choice of two futures: compromising on principles and moderating themselves to irrelevance, or re-affirming their faith in the Constitution, fiscal common sense, and the strength of the American people to meet the challenges before us. For their sake, and ours, let’s hope they choose the right path.
Representative Paul Ryan (R-WI) often insists that America faces a choice of two futures. Ryan lays out this stark choice in a video promoting his latest budget: "Americans have a choice to make. A choice that’s going to determine our country’s future. Will it be the future that looks like the America we know? One of greater opportunity, greater prosperity? Or more of what we’re seeing today? Debt, doubt, and decline. Americans, not Washington, should decide." - Rep. Paul Ryan
I'm sticking my neck out here, but I think it's the most likely outcome, following last week's Supreme Court oral arguments in the historic ObamaCare lawsuit.
Before the arguments, I'd have said the individual mandate will likely be struck down. Now I'm strongly inclined to think the Court will nullify the whole 2,801-page law. See if you agree.
Dean Clancy is FreedomWorks' Legislative Counsel and Vice President, Health Care Policy
Click to listen! ObamaCare is doomed. I'm sticking my neck out here, but I think it's the most likely outcome, following last week's Supreme Court oral arguments in the historic ObamaCare lawsuit.
Yesterday, the House passed Paul Ryan's ten-year budget plan on mostly party lines while rejecting President Obama's budget unanimously. In my audio update this morning, I discuss the votes and give a brief look at the state of the national budget debate.
P.S. In the update, I name the 10 Republicans who voted against the Ryan budget, characterizing them as fiscal stalwards. That isn't quite right. Some of them are squeamish Republicans who apparently don't want to cut spending, at least not in the way that most of their fellow Republicans do.
The strongest fiscal conservatives, whom I should have named, but unfortunately didn't, are the following five Republicans who voted only for the more conservative alternative, the RSC budget, which was the only plan offered that would balance the budget. They are: Justin Amash (MI), Joe Barton (TX), Tim Huelskamp (KS), Paul Broun (GA), and Ron Paul (TX). These five are the cream of the cream. We need more like them in Congress.
For a more detailed written account, and additional information on the budget debate, go to this recent blog post.
Dean Clancy is FreedomWorks' Legislative Counsel and Vice President, Health Care Policy
Click to listen! Yesterday, the House passed Paul Ryan's ten-year budget plan on mostly party lines while rejecting President Obama's budget unanimously. In my audio update this morning, I discuss the votes and give a brief look at the state of the national budget debate.
Today, the House passed a budget -- something Senate Democrats haven’t bothered to do in nearly three years (1,065 days, to be exact).
The budget, drafted by House Budget Committee Chairman Paul Ryan, resembles last year’s Ryan budget. It now goes to the Senate, where Harry Reid and his fellow Democrats aren’t likely to take it up.
The House also voted on President Obama’s budget. Want to guess how many votes it got? Zero. That’s right. No one voted for it, not even the Democrats. Ouch. That’s gotta hurt.
The House voted the President’s budget down unanimously by a vote of 0-414. Last May, the Senate voted down the Obama budget, 0-97. The White House is on a roll.
Anticipating the humiliation, the administration attempted to discredit the vote ahead of time by calling the whole exercise a “gimmick.” Considering that President Obama’s last two budgets have both failed to garner even a single vote in either chamber of Congress, perhaps his budget proposals are the gimmicks?
The process involved votes on a series of competing budget proposals. Members were able to vote for any or all of them. The one that passed first would become the base text, and the one that passed last would become the House position and go over to the Senate. In the end, only one budget passed: the GOP leadership-backed Ryan budget.
After voting down the Obama budget unanimously, the House also voted down a series of three liberal budget proposals:
The House also considered a “moderate” budget proposal:
Finally, the House considered two conservative budget proposals:
The 175-member RSC offered the only budget that met the balance-in-seven-years requirement of the Goodlatte Balanced Budget Amendment (H.J.Res. 2), which the House voted on last fall. Sixty percent of the House and 98 percent of House Republicans voted "yes" on the Goodlatte BBA. The RSC Budget failed, alas, despite strong support from fiscal conservatives both inside and outside of Congress; the vote was 136 in favor to 285 against. Sadly, of the 285 “noes”, 101 came from Republicans who had previously voted for the balanced budget amendment.
The RSC budget comes the closest of those offered to the Tea Party Budget. That’s why FreedomWorks decided to “key-vote” in favor of it, counting it as a essential vote on our scorecard of votes that determine which members are truest to the tea party principles of smaller, constitutionally limited government. We didn’t key-vote any of the other budget plans, not even Ryan’s, which, while a good start, doesn’t go far enough to avert the coming debt crisis.
Not a single Democrat voted in favor of the Ryan budget, and 10 Republicans voted against it: Reps. John Duncan (TN), Chris Gibson (NY), Walter Jones (NC), David McKinley (WV), Todd Platts (PA), Denny Rehberg (MT), Ed Whitfield (KY), Justin Amash (MI), Joe Barton (TX), and Tim Huelskamp (KS).
Five Republicans voted only for the RSC budget: Justin Amash (MI), Joe Barton (TX), Tim Huelskamp (KS), Paul Broun (GA), and Ron Paul (TX). These men are all staunch fiscal conservatives who feel, as many of our members do, that the Ryan budget, while a good start, doesn’t go far enough to avert the coming debt crisis.
For more details on the competing budget plans, see our handy FreedomWorks Budget Report Card.
The main lesson that supporters of smaller, constitutionally limited government can take away from all of this is that, despite the historic gains we achieved in the 2010 elections, we need to send even more fiscal stalwarts to Washington like the ones who voted for the RSC (conservative) budget today -- and especially those who voted only for that budget.
Today, the House passed a budget -- something Senate Democrats haven’t bothered to do in nearly three years (1,065 days, to be exact). The budget, drafted by House Budget Committee Chairman Paul Ryan, resembles last year’s Ryan budget. It now goes to the Senate, where Harry Reid and his fellow Democrats aren’t likely to take it up. The House also voted on President Obama’s budget. Want to guess how many votes it got? Zero. That’s right. No one voted for it, not even the Democrats. Ouch. That’s gotta hurt.
According to ex-governor Jennifer Granholm, Congressman Paul Ryan (R-WI) needs a “reality check” over his new budget. Blogger Jonathan Bernstein adds that Ryan’s budget “is not serious.” A Los Angeles Times editorial nods in agreement, insisting that, “it seems fated to wind up in the… dustbin.”
More pointedly, Salon editor Joan Walsh labels the budget “a cocktail of snake oil and castor oil.” Columnist Dana Milbank writes that some of the wording in the budget is “Orwellian” and he considers Ryan “patronizing.” Blogger and academic Robert Reich claims that the budget is an example of “radical Social Darwinism.” Washington Post writer Matt Miller considers the budget full of “deceptions” and argues that “the first order of business is to expose Ryan’s overall plan for the misguided, misleading, and unacceptable vision it represents.” Finally, White House Press Secretary Jay Carney joined in to proclaim that the Ryan budget is “aggressively and deliberately ignorant.”
Well, is it? Is Paul Ryan’s budget, titled “The Path to Prosperity: A Blueprint for American Renewal”, really as extreme and uncompromising as its opponents suggest?
First, we must understand what goals one considers when creating a budget. Obviously, budgets are meant to provide a spending and policy outline to the government. However, budgets are also inherently political, and they convey distinct messages to the political world. What messages are this year’s budgets proclaiming?
The Obama budget reeks of “re-elect me.” After his budget died in the Senate with a 0-97 vote last year, President Obama decided to move farther left by abandoning any pretenses of concern over spending. His budget racks up trillions of dollars more in debt and never balances.
What message does Paul Ryan’s budget send? To an honest reader, the answer is mostly “compromise.” The Medicare reform at the heart of his budget is the result of a partnership with Senate Democrat Ron Wyden. The Ryan budget repeals ObamaCare, but a majority of Americans support repeal. The budget doesn’t really touch Social Security, and avoids drastic measures to balance the budget, only doing so in 2040. Just for a point of contrast, Senator Rand Paul’s (R-KY) budget proposes to balance the budget by 2017, more than twenty years earlier than Paul Ryan.
The question isn’t whether the Ryan budget is “too extreme” for serious consideration. The question is, should conservatives support it? After all, the Ryan budget is full of compromises. Programs and agencies that conservatives want to eliminate are instead reformed. The budget does not abolish a single department, whereas Rand Paul abolishes four.
It is very rare for a bill, let alone a budget, to make it through the legislative process without amendments or compromises. Particularly with a divided government, compromise is necessary for passing legislation. Does Paul Ryan compromise too much? Perhaps. Compared to the excellent “Tea Party Budget” proposed by Senators Rand Paul, Mike Lee (R-UT), and Jim DeMint (R-SC), the Paul Ryan budget does not go as far in reforming and shrinking government as we would like. However, it is an excellent first step, and an undeniably massive improvement on the existing system or the Obama budget.
As conservatives, we must be able to compromise on legislation in order to make a difference, but we can never compromise on principles. Paul Ryan’s budget may be too limited and cautious, but it does not compromise on fundamental principle. It repeals ObamaCare, privatizes government-sponsored housing giants Fannie Mae and Freddie Mac, block-grants Medicaid and food stamps, caps the size of government, and implements necessary tax reform. We cannot let the “best” be the enemy of the “good”. Rand Paul’s budget may be best, but Paul Ryan’s budget is good enough to support.
According to ex-governor Jennifer Granholm, Congressman Paul Ryan (R-WI) needs a “reality check” over his new budget.
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