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House Budget Committee Chairman Paul Ryan did a great public service when he released his budget last week. By throwing a piece of total garbage on the table and pretending it is a real budget plan, he allowed us to see who in Washington is serious about the budget and who just says things that will push their agenda.

It is easy to see that Ryan himself could not possibly be serious about the document he put out as a “Path to Prosperity.” The Congressional Budget Office analysis of the plan, which was prepared under Representative Ryan’s direction, shows that all categories of government spending outside of health care and Social Security will shrink to 3.75 percent of GDP by 2050.

This 3.75 percent of GDP includes defense spending, which is currently close to 4.0 percent of GDP, not including the cost of the war in Afghanistan. Representative Ryan said that he wants to keep defense spending close to its current level. This means that we have no money left to pay for the Justice Department, the State Department, support for education, roads and other infrastructure, the Park Service, the National Institutes of Health and all the other things that we expect the federal government to do. Essentially Paul Ryan is an anarchist who is proposing to shut down the federal government.

This cannot be a misrepresentation of Representative Ryan’s agenda. He put out essentially the same budget last year at which point many people pointed out the fact that he shrank most categories of government spending to zero. If that was a mistake (albeit an incredibly foolish one) he has now had a full year to reflect on his error and redesign a budget to reflect his real priorities.

Instead, he doubled down. In Representative Ryan’s 2012 Path there is no room for federal funding for all the services that even conservatives expect the government to provide. Does the Republican right now want to shut down federal prisons and end border patrols as Representative Ryan’s budget implies.

This is also not a case of pulling out long-term implications that have no serious meaning. It is a common and silly practice in budget debates to project out a trend for 75 or 100 years and show it leads to an untenable situation when everyone knows the trend will not continue for this long period. (more…)

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Rachel Maddow points out that despite the best efforts of Republicans to spin and confuse the issues of the Republican war on women and the Republican war on Medicare, American voters know who’s really attacking their rights and services.

As a favor to struggling Americans, U.S. Rep. Paul Ryan, R-Wis., proposed a federal budget last week ravaging programs for the poor, elderly, disabled, young, veterans, jobless, students and other vulnerable people. Ryan did it, he said, because these programs, food stamps, health insurance, Pell grants, veteran’s hospitals and the like are demeaning.

Yes, demeaning.

So Ryan plunders them and gives the savings to the rich in the form of additional tax breaks.  Half of the savings in Ryan’s budget come from destroying health insurance programs. That would cost tens of millions of Americans their coverage.

Uninsured and underinsured toddlers, injured veterans, and disabled workers may die from some curable disease as a result. But at least Ryan will save those people from being demeaned!

That Ryan, what a guy, huh? Arranging for the nation’s well off to shirk responsibility to the vulnerable – then calling it kindness.

Ryan offered up the sequel to last year’s failed country club conservative budget and explained that he purged programs for the hapless because a social safety net:

“. . . lulls able-bodied people into lives of complacency and dependency, which drains them of their very will and incentive to make the most of their lives. It’s demeaning.”

Oh. That’s the demeaning thing! It isn’t being so poor that health insurance is unaffordable, getting emergency treatment for a broken hip, then being hounded by hospital bill collectors while still in a body cast and unable to work. It wouldn’t be watching your mother die in unbearable pain of a treatable cancer because she couldn’t afford health insurance. It wouldn’t be realizing your child may die because you lost your job and with it your health insurance during the Wall Street-caused recession, then discovered your baby suffers a rare heart disease that’s treatable for those with insurance, but fatal for those without because they can’t afford the medications.

No. The really demeaning thing according to the GOP is the social safety net that provides health insurance to the impoverished, to children, to veterans, to the disabled and to the elderly.

The Ryan health de-insurance plan would smack down Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), care for veterans and the Patient Protection and Affordable Care Act.

Ryan announced his intent to repeal the Affordable Care Act just days before the second anniversary of the law that has provided coverage for 2.5 million young adults up to age 26 on their parents’ plans; has forbidden insurers from denying coverage for children with pre-existing conditions, and has banned the insurance company practice of cancelling coverage when policy holders got sick.

Ryan wants to repeal the law rather than wait for a decision on its constitutionality from the U.S. Supreme Court, which will hear arguments this week from country club conservative state attorneys general who want the justices to overturn the landmark measure before it can provide coverage to 33 million uninsured Americans. Because, of course, getting that insurance would be demeaning for those people.

Ryan proposes to repeal the law while providing absolutely no alternative — no plan to cover the uninsured, no plan to close the Medicare donut hole, no plan to make sure insurers don’t re-institute lifetime limits, no plan to stop insurers from once again cancelling coverage when policy holders get sick. Because, of course, providing those protections would be demeaning.

Ryan also would slash by 45 percent federal funding for Medicaid and other health plans for low-income people including the Children’s Health Insurance Program. Last year, the Urban Institute estimated that a similar Ryan proposal to cut Medicaid and convert it to a block grant program administered by the states would strip coverage from as many as 27 million low-income Americans within a decade. Because, of course, denying coverage to impoverished children would ensure the federal government did not demean five-year-olds with life-threatening asthma and sickle cell anemia. (more…)

By now most people have heard some of the worst things about the Republican budget proposal – commonly called the “Ryan plan” and unironically described by the GOP as “the Path to Prosperity”: That it decimates programs for middle class and lower-income Americans while giving even greater tax breaks to the rich – $3 trillion worth, in fact. That it guts education, research, and transportation while preserving tax breaks for Big Oil. That it undercuts Medicare with a voucher system that will be worth less and less with each passing year.

And that, despite all that, it would actually increase the deficit.

You’d think that pretty much covers it – but it doesn’t. When it comes to Medicare, there are three more ugly facts about this plan that have yet to attract widespread attention – mostly because the Republicans have done their best to keep them secret:

1. They’re secretly planning to raise the Medicare age.

It’s not in House Budget Chair Paul Ryan’s Wall Street Journal editorial, the one where he sneered at “some who would distort for political gain our efforts to preserve programs like Medicare” and said “our plan provides guaranteed coverage options financed by a premium-support payment.” It’s not in the summary description of the GOP budget, which it claims “strengthens health and retirement security by taking power away from government bureaucrats and empowering patients instead with control over their own care.” It’s not even in the full budget document itself, which is 99 pages long and contains a section entitled “Strengthening Health and Retirement Security.”

So how do we know that the GOP wants to raise the Medicare eligibility age from 65 to 67? Because that’s what Ryan and his staff told the Congressional Budget Office when they asked the CBO to calculate the impact of their plan. It’s right there in the CBO report on the budget.

Here’s the key sentence: “In addition, the eligibility age for Medicare would increase by two months per year beginning in 2023 until reaching age 67 in 2034.”

That’s right: When Ryan and his staff instructed the CBO to calculate the impact of the Republican budget, they told its analysts that the GOP plan included an increase in the eligibility age for Medicare. Apparently they didn’t have room to mention that fact anywhere in their 99-page document, and didn’t see fit to bring it up while they were spouting all that rhetoric about “preserving entitlement programs for the future.” (more…)

There is an old story about two men in a retirement home. The first declares, “the food in this place is poison.” His friend agrees and adds, “and the portions are so small.” This exchange perfectly captures the Republican approach to Medicare.

The Republicans, led by House Budget Committee Chairman Paul Ryan, have argued that Medicare threatens to bankrupt the country. They have pointed to cost projections showing the program more than doubling relative to the size of the economy over the next three decades. The Republicans say that the country cannot afford this expense and scream about huge debt burdens for our children.

The Republicans’ concern might lead people to believe that they would support measures to contain Medicare costs. But if you thought that was the case, you would be wrong.

The latest Republican crusade on Medicare is to eliminate the Independent Payment Advisory Board (IPAB), which was put in place as part of the health care reform bill passed two years ago. IPAB is empowered to impose a cap on Medicare spending if it grows too fast relative to the size of economy. The way it would reduce cost growth is by reducing or eliminating payments for medicines and procedures that have not been shown to be effective.

The idea that Medicare would not pay for some medicines or procedures has Republicans in Congress screaming about “death panels” and “rationing.” It is fascinating how Republicans use these terms. These politicians, who like to portray themselves as lovers of free markets, are now claiming that it is rationing if the government will not pay for something.

We have to keep our eye on the ball. No one is telling people that they can’t spend their own money on any medical care they like. The issue is simply what care Medicare will pay for. Under current law the IPAB may impose constraints that stop the government from paying for care that has not been shown to be effective. Only in some bizzaro world can this be called rationing.

What’s striking is the Republican alternative. While they scream bloody murder over any effort to constrain costs in Medicare, their own plan is to simply end Medicare as we know it. The plan approved by the Republican House last year would end Medicare as a publicly run system. It would instead give beneficiaries a voucher that they could use to buy insurance in the private market. (more…)

In case anyone in America didn’t know, Mitt Romney is rich. So rich, in fact, that yesterday on his 65th birthday, he announced that he’s not planning to sign up for Medicare.

I’m not sure what Romney’s trying to prove, but what his action says is clear: I’m not like the Americans who enroll in Medicare. I’m special. I’m rich. I’m better than you.

Ask yourself: If Romney doesn’t need or want Medicare for himself, will he protect it for the rest of us who do? Of course not. Instead, he’ll continue to support the Republican plan to eliminate Medicare as we know it. He’ll work to turn Medicare into a voucher program that will saddle seniors with thousands of dollars in out-of-pocket health care costs. Because, after all, what senior can’t afford to spend an extra $6,400 a year on doctors and hospitals?

Romney’s support for eliminating Medicare as we know it is serious. Along with Medicaid and Social Security, Medicare is the foundation of economic security for America’s seniors and families. It allows middle-class people to retire with dignity and the knowledge that they will have health care when they need it. Medicare is part of ensuring that everyone gets to share in America’s prosperity.

Before Medicare, seniors were left at the mercy of the private market and therefore virtually uninsurable. Without insurance, even brief hospital stays could impoverish them. The result was that the elderly went without the care they needed — unless their families were rich. Most seniors were one illness away from bankruptcy.

The concern that Mitt Romney is out-of-touch is a real one, not just because he’s insulated from the day-to-day financial struggles that 99% of America’s families have to deal with. The problem is that he self-selects into the 1% every chance he gets.

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Ethan Rome served as deputy campaign manager in HCAN’s 2009 successful campaign to win comprehensive health care reform. He has been a grassroots organizer, political activist, and strategic communicator for progressive issue and electoral campaigns for more than 20 years. From 2002until 2009, Mr. Rome directed public affairs for the 1.6 million-member American Federation of State, County and Municipal Employees (AFSCME). He managed national communications and media relations for International President Gerald W. McEntee and the union’s priority organizing, legislative and political campaigns. Prior to joining AFSCME in 1999, Rome was chief policy and political adviser to the speaker of the Connecticut House.

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Follow Ethan Rome on Twitter: www.twitter.com/@HCAN

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This piece is republished from The Huffington Post.

Is smaller government really better for the economy? Conservatives chant that taxes and government “take money out of the economy” and we need to “cut and grow,” meaning if government spending is cut way back the economy will grow as a result. Europe’s conservatives are also forcing cuts in the things their governments do for regular people, claiming “austerity” will bring “confidence” that grows their economies. How is this experiment working out? What are we learning about the effect on the larger economy when government is cut?

What Does Government Do?

Almost everything the government does is because it needs to be done. We need roads, bridges, schools & colleges, dams, courts, police & fire departments, water management, etc. (We can discuss the need for military spending another time.)

These are all needed and contribute to the functioning of the economy. So if government is cut back and doesn’t do something that is needed, then how does it get done? Or does it just not get done? Either way, the real question we should be asking is what is the effect on the larger economy when our government cuts back on or stops doing needed things? If you save the “government” a bit of money but cost the economy a lot of money, are you saving money? Or are cuts in government really just shifting and even increasing the costs in the larger economy of doing these things?

Who Is Our Government For?

In the United States, our Constitution says that government is supposed to be of, by and for We, the People. The country was established after the colonists rebelled against the aristocracy of England — a few people who had all of the wealth and power and would not let the colonists have a say in how things were run and who would benefit. So they fought the Revolutionary War and established a country where “We, the People” all have an equal say, and to “promote the general welfare.” In other words, a country that aspires to be of, by and for the good of all of us.

So cutting back on government means cutting back on We, the People doing things for the good of all of us. It means cutting back on the things we have a say over. It means relinquishing the wealth and power that we hold in common to … well, just where does our common wealth and power go if our government is cut back?

Medicare, For Example

Republicans say we need to cut back on what the government spends on Medicare. But if you cut Medicare the health problems of elderly people and the larger problem of fast-rising health care costs in the larger economy don’t disappear. In fact, both problems just get worse.

The “Ryan Budget” that Congressional Republicans voted to approve actually converts Medicare into a program that gives seniors a voucher that pays for part of a private medical insurance policy that seniors have to shop for. The Center for Economic and Policy Research (CEPR), in Cost of Medicare Equivalent Insurance Skyrockets under Ryan Plan, took a look at that plan and explains what happens to the cost of health care. Summary: it shifts the costs to us, except each of us ends up paying as much as seven times as much as the same care costs under Medicare. From the CEPR explanation:

[The Republican] plan to revamp Medicare has been described as shifting costs from the government to beneficiaries. A new report from the Center for Economic and Policy Research (CEPR), however, shows that the [Republican] proposal will increase health care costs for seniors by more than seven dollars for every dollar it saves the government, a point missing from much of the debate over the plan.

… In addition to comparing the costs of Medicare to the government under the current system and under the [Republican] plan, the authors also show the effects of raising the age of Medicare eligibility. The paper also demonstrates that while [the Republicanplan ] shifts $4.9 trillion in health care costs from the government to Medicare beneficiaries, this number is dwarfed by a $34 trillion increase in overall costs to beneficiaries that is projected …

Repeat, the Repubican plan to cut Medicare would cost the larger economy seven times as much as it cuts government spending.

Social Security, For Example

Conservatives have been trying to cut or gut Social Security for decades. While this might mean government has to pay out less of what is owed to seniors, such cuts would have a negative effect on the larger economy.

Social Security allows working people to retire with at least a minimal income. If this is cut many could not retire for many more years (if ever), which would increase the unemployment rate because their jobs would not open up. The same is true as the retirement age is increased – fewer job openings. If it is cut, the spending (on catfood) at local grocery stores and other necessities is reduced by the same amount. And the effect on children of retirees is increased, if they contribute to make up the difference.

This is why cutting Social Security or raising the retirement age only shifts costs onto the larger economy, dragging it down (and cruelly hurting our elderly).

Cutting Disease Control, For Example

One of the clearest examples of the way government helps us all, rich and poor, is the government’s Center for Disease Control (CDC). One of the jobs of the CDC is to help prevent the spread of infectious diseases. If an epidemic is spreading and killing people it doesn’t matter if those people are rich or poor. And if a serious outbreak spreads this can damage the economy as people are too sick to, or decide not to show up for work. So of course cutting back the budget of the CDC could cause damage to the economy in any given year and is certain to cause damage eventually. (The CDC budget was cut back 11% last year.)

Budget Cuts Hurt The Economy

The above are only a few examples.

A government budget cut is like a huge tax increase on regular people because it increases what each of us pays for the things government does — or forces us to go without. This is because cuts in government spending don’t actually cut the costor the need for those things, they just shift those costs onto the larger economy. But because these shifts attack the economy-of-scale, transparency, integrity and public-good management that government provides, they almost always increase the costs and harms to the larger economy.
•As government health care is cut (or not provided in the first place) each of us must take on those costs on our own, and as demonstrated, pay up to seven times what the same care would/could have cost.
•As infrastructure maintenance and modernization is cut, our economy becomes less competitive, unemployment increases and our wages and spending power fall.
•As spending on education is cut, our costs of educating ourselves and our kids increase. College costs soar. And the overall education level of our people will decrease, making our country less competitive in the world.
•As environmental regulation and enforcement is cut the costs of the resulting health problems and cleanups increase and our quality-of-life will decrease.
•As enforcement of labor laws is cut, our wages and protections fall.
•As etc. is cut, the costs of etc. are shifted to the larger economy, and the total costs of accomplishing etc. actually increase.

As budgets are cut, the costs are increased and shifted to the larger economy.

Austerity In Europe

Several countries in Europe are severely cutting budgets. The result is that the economies in those countries are slowing. Reuters: Euro zone’s slump in late 2011 points to recession.

A collapse in household spending, exports and manufacturing sucked the life out of the euro zone’s economy in the final months of 2011, the EU said on Tuesday, showing the scope of the downturn that looks set to become a fully fledged recession.

… The European Commission forecasts a recession of the same magnitude this year. That would be the euro zone’s second contraction in just three years as the bloc’s debt crisis drags on a region that generates around 16 percent of the world’s economic output.

[. . .] The battle between austerity and growth was already evident in the fourth quarter. Euro zone government expenditure fell 0.2 percent, while industry contracted 2 percent and imports were down 1.2 percent, making for some of the worst readings since the world was dragged into the 2008/2009 financial crisis.

The austerity experiment is making the case: cutting government budgets just shifts costs and hurts the larger economy.

Who Benefits From Cuts?

Governments dance with the ones that brung ‘em. Whoever controls government is naturally going to direct government to benefit them – and only them. We-the-People democracies do things for We, the People; plutocracies do things for plutocrats. So when, as now, plutocrats are running government, you will get a government that only does things that benefit plutocrats. And when We, the People were running government, we did things that benefit We, the People — all of us.

The plutocrats now demanding government budget cuts obviously understand that this will result in slowing economies, but don’t care — they are already fabulously wealthy. What they want is reduced taxes and increased power. They say that cuts will bring growth, in order to persuade people to accept cuts. Blocking governments from providing things that don’t directly benefit them and only them is a means to that end. And cutting government cuts government’s ability to reign them in.

What We, the People Want

When We, the People are running government we insist that government increases overall prosperity. We demand laws and regulations that bring us good wages, benefits and safe working conditions. We demand good public schools & colleges, parks, safety and opportunities for our smaller businesses to fairly compete. We insist on a clean environment, consumer protections, regulations on business behavior, rules against monopolies and (after learning the hard way) rules that keep banks from taking risks that threaten the economy. And we want controls and limits on the use of wealth and power by the 1%ers.

Plutocrats — the 1%ers — of course see all of these protections of regular people as hindering their power and ability to make as much for themselves as they can grab. Plutocrats just don’t see how public parks benefit them. They just don’t see why they should have to pay for public schools. What good do public schools do them, today? Plutocrats don’t see why it should be anyone else’s problem if old people don’t have health care — health care for seniors certainly isn’t their problem.

They explain that things for anyone other than themselves and their interests just “wastes money.” Things for regular people are not their problem. And when plutocrats run government, it isn’t their problem.

The fact is a public park “costs money.” Schools and infrastructure are just more “government spending.” Things like that just “redistribute income” because taxes on the income of plutocrats is used to build that park or school that anyone can use. The basic message of the plutocrat is, “Why should I pay for anything that benefits you?”

You and I might argue that this kind of austerity, cutting schools, Medicare, infrastructure, etc. slows the larger economy, hurting the plutocrats, too. But that doesn’t hurt the ones who are already rich, which is the definition of plutocrat. It puts more in their pockets, today, by lowering their taxes. They want out of taxes and they don’t want government (We, the People) interfering with their power.

What We, The People Need

Democracies where We, the People make decisions demand things that are good for regular people and their small businesses: pensions, health care, modernized infrastructure, good schools & colleges, child care, regulations on the behavior of giant corporations… This is why strong democracies have proven to be more prosperous for regular people and for longer than other forms of government that leave people on their own against the wealthy and powerful and drive all of the income and wealth to a few at the top. This is why so many regular working people in our country were so much more prosperous in the decades before the plutocratic 1%-favoring policies of Reagan steered us toward plutocracy.

Understand what is going on here. Demands for budget cuts and austerity are really about shifting from democracy to a system where regular people — the 99% — are on their own, up against the wealthy and powerful. This is about shifting from a system where regular people can be prosperous together, to a system where a few — the 1% — have all the wealth and power.

We, the People need democracy restored. We need to be in charge again, before the economy can improve.

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Follow Dave Johnson on Twitter: www.twitter.com/dcjohnson

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture.

Did you know Obama’s health care bill contained a $20 billion a year tax on the richest Americans? I didn’t until I stumbled onto a mention of this the other day, although writing about politics is my life and I was angry at the loss of a national public option. I asked a dozen other friends, half of whom work in health care and most of whom are fellow political junkies. None of them knew either. If those who follow these issues intensely don’t know about something that all of us would cheer as a step toward getting the wealthiest to pay their fair share, most American voters sure aren’t going to know either.

The tax supports Medicare and low-income health care subsidies. Beginning in 2013, it will bring in $210 billion over 10 years by charging households that make over $250,000 a year 3.8% on everything over that amount instead of the current 2.9%. More important, the provision applies to investment and dividend income for those in that category, a key precedent toward ensuring that billionaires pay at least the same share of taxes as self-employed carpenters. It got some modest coverage when it passed, and accountants certainly know about it. But the rest of us don’t, which frustrates me. (more…)

Earlier this week, Republican Presidential candidate Willard Mitt Romney delivered a speech framing the 2012 presidential election as a choice between an “entitlement society” and an “opportunity society.”

It really takes chutzpa for a guy who was born with a silver spoon in his mouth to rail against an “entitlement society.” Here is a guy who got his start in life the old-fashioned way — he inherited it.

Now I realize that you don’t get to choose your parents. He had no role in deciding that he would be born into the family of an auto executive and Michigan Governor — but at least he should have the decency not to attack “entitlements.”

This is not a guy who pulled himself up by his boot-straps. His name, his family connections and — not incidentally — his money gave him a real leg up when he decided to go into the investment banking business. And let’s not forget that when he did go into business for himself, he didn’t make money building things or inventing things — or designing new products. He made money buying companies, and often breaking them up, or firing employees.

Last Sunday’s New York Times reported that Romney continued to make money from his old firm Bain Capital through his time as Governor and his attempts to run for Senate and President. It noted that much of his income is likely taxed at only 15% — though we don’t know for sure since he refuses to release his tax returns.

He is the poster boy for the one percent — and he is talking about “entitlements”?

If you ask someone on the street which kid in high school Mitt Romney reminds him of, he is likely to tell you it’s the kid who drove to school in a Ferrari and got all the socially “in” girls. He was the smug guy who knew he was set for life. (more…)