The so-called ""Path to Prosperity,"" a slew of budget reform measures backed by U.S. Rep. Paul Ryan, R-Janesville, is anything but helpful. Ryan claims that by cutting programs such as Medicare and Medicaid, he will be able to save the government $6 trillion. So, just what are some of the more questionable items in this new budget bill?
First, Ryan wants to turn Medicaid into a block-grant program. Right now, Medicaid is a matching program, meaning if a state adds more Medicaid recipients, then the federal government will help fund the costs by matching a certain percentage. Ryan suggests that each state should be allocated a certain amount of funding, which he believes will give governors across America more flexibility to distribute Medicaid money and give the federal government more control over the costs.
While those things may be true, you should instead look at the consequences this cut will have on the American people. Overall, Ryan's plan would cut funding for the program by about $1.4 trillion over the next 10 years. This money is being taken away from the poorest people in America, which makes no sense, fiscally or otherwise.
Millions of low-income seniors and families get help from Medicaid that Medicare doesn't cover. This includes long-term care, nursing, home health care, mental health coverage and much more. Medicaid is also one of the largest providers of health insurance for children. Why would we taking services away from the poor, the old and our kids?
Secondly, Ryan plans to completely revamp the Medicare program. As it stands now, the government reimburses doctors and hospitals for medical procedures. Ryan argues that this guarantee of a government reimbursement has led to the obscene prices hospitals charge their patients. His solution is to create a voucher system where senior citizens are allotted $15,000, which would grow with inflation, that will ultimately serve to pay for their insurance. He believes that by giving vouchers directly to the senior citizens it will force insurance companies to compete with each other, which will ultimately lead to lower prices and more government savings.
In theory, it seems like this plan could be successful.
However, according to U.S. Rep. Carolyn Maloney, D-New York, ""These vouchers would not keep pace with increases in the cost in health care."" She calculates that senior citizens would actually have to pay over $6,000 more per year for health care under Ryan's plan. So, while the government saves money, it condemns the elderly to settle for subpar health care at a price they might be able to afford with their government voucher.
Ryan also plans to repeal the health-care reform law Democrats passed two years ago. This would allow insurance companies to cancel coverage when policy holders get sick, kick children off their parents' health insurance plan when they turn 18 and discriminate against people with existing conditions. Ultimately, Ryan's Medicare reform would strip millions of people of their health care. The sad part is that the first people to lose any form of health care are the poor.
All right, so far Ryan's plan would cut two important social programs, now how are we going to get some extra revenue? Tax the crap out of the rich, right? No.
Not surprisingly, Ryan would cut corporate tax levels from 35 percent to 25 percent. Albert Einstein once said, ""The definition of insanity is doing the same thing over and over again and expecting a different result,"" and this is exactly what Ryan is doing.
The only two times the tax level was even near 25 percent was right before the Great Depression and in the late 1980s when we experienced an enormous budget deficit that exceeded the one we had during a recession a few years earlier in the '80s. Why are we trying this again? It obviously doesn't work.
I'll give Ryan some credit for closing some annoying loopholes, which makes it even easier for corporations to avoid paying taxes. That would definitely help close the deficit by ensuring that corporate taxes are properly paid.
But it's truly frightening how what is happening now is almost identical to what happened in the 1920s. World War I created increased government spending, which lead to a recession similar to the way wars in Iraq, Afghanistan, and now Libya have cost billions today. In the first year of depression over 600 banks failed, whereas nearly 400 banks have failed since 2007. Back then organized labor lost its power and union membership declined. Today, Republicans have been attempting to bust unions all over the country. Taxes on the rich fell and productivity increased, but rewards funneled to the top. And now Ryan's new budget decreases taxes for big corporations. Haven't we learned anything?
The GOP seriously needs to consider the implications of these massive cuts. For some reason it seems as if
Republicans think there will be no consequences. Yeah, you may save some money over the next 10 years, but you are ultimately burdening people who can't afford to be burdened.
Ryan is like Robin Hood's evil twin, stealing from the poor and giving to the rich. Senior citizens and the poor have enough to worry about. There's little wrong in taking from people who can afford it, which would be more than enough to fix our deficit.
Nick Fritz is a sophomore majoring in marketing. Please send feedback to opinion@dailycardinal.com.
