Democrats also need to rethink policies

March 13, 2013

By John Seiler

Since their drubbing in last November’s election, Republicans have been taking a lot of criticism about their polices, especially for California. We’ve done a good bit of it on our site.

But Democrats also need to rethink their positions. A good example of how Democrats think is Andrew Rosenthal, the editorial page editor of the New York Times, the Democrats’ party newspaper. He writes:

“The Republicans have hit a sour spot in politics — they are 180 degrees opposed to what most Americans want on just about any issue you care to name.

“Remember, for instance, how the American people rejected the Romney/Ryan ticket, and in particular Paul Ryan’s budget? Today Mr. Ryan released a remarkably similar budget. It even has the same Orwellian title: “The Path to Prosperity.”

“The Ryan budget, which will become the official G.O.P. budget just as soon as the Republican majority in the House gets a chance to vote on it, gives nice big tax breaks to the wealthy. At the same time, it would turn Medicare into a voucher system, gut Medicaid by turning it into a block grant to the states, give states the ability to kick people off food stamps and repeal most of health care reform. (Except the Medicare savings, which Mr. Ryan has added to his deficit-reduction proposal.)”

Orwellian? It’s true that Ryan’s numbers are a fantasy. But so are almost all politicians’ numbers. According to Dictionary.com, the real definition of Orwellian is:

“of, pertaining to, characteristic of, or resembling the literary work of George Orwell or the totalitarian future described in his antiutopian novel, ‘1984.’”

That is, Orwellian lies are of a special kind as in those from “1984”: war = peace, freedom = slavery. Merely crafting a fantasy budget that won’t be enacted anyway doesn’t reach that level, but rather is a mundane reality of politics, like politicians breaking campaign promises.

But talking about fantasies, let’s parse the rest of Rosenthal’s piece.

“The Ryan budget, which will become the official G.O.P. budget just as soon as the Republican majority in the House gets a chance to vote on it, gives nice big tax breaks to the wealthy.”

I won’t say that’s Orwellian, but it is misleading. His link is to an analysis by Matthew Yglesias that someone making $70,000 a year might see a tax increase under Ryan’s plan, which establishes two tax rates of 25 percent and 10 percent. We’ll have to see the details on that one.

But one thing is for sure: their beloved President Obama, joined by the Republican leadership in Congress, on Jan. 1 jacked up taxes 2 percent on 77 percent of Americans. Someone making $70,000 a year saw his taxes rise $1,400 a year.

Punishing investors

As to rich people, Rosenthal doesn’t point out that they’re the major investors in our country. Take money from them, and there’s less money for investment in business and jobs creation. Eventually, many rich folks also get sick of paying taxes and leave for other, freer countries.

Rosenthal:

“At the same time, it would turn Medicare into a voucher system”

Well, the system is going broke. According to economist Laurence Kotlikoff of Boston University, the real budget problem is not the federal debt of $16 trillion. It’s the federal unfunded liabilities of $222 trillion. It’s an incredible number and amounts to more than $700,000 owed by each American, including children. That’s more than $2.8 million owed by each family of four.

So what’s Rosenthal’s response? Ridicule. Ryan’s proposal to reform Medicare, which is the major component of the $222 trillion in liabilities, won’t  help much. But it’s at least worth talking about.

A voucher system for Medicare would turn it into something like Food Stamps. When you qualify for Food Stamps, called CalFresh here, you don’t work through an elaborate bureaucracy to get your cheeseburgers. They just fill up your EBT card with around $225 a month of the taxpayers’ money for each person in your family, then you go to the local grocery or convenience store and use the card like a credit card.

I don’t know if Ryan’s Medicare voucher system would work, and the details are crucial; but it’s worth looking into. The key with vouchers is that you can generate at least a little competition, which keeps prices down.

Medicaid

Rosenthal says Ryan wants to:

“gut Medicaid by turning it into a block grant to the states.”

I don’t know how much contact an elitist like Rosenthal has with poor people stuck in the Medicaid system (Medi-Cal in California), but it’s a complicated bureaucracy. I’ve helped poor friends of mine navigate the system. Although I’m not in the medical field, I am in the policy field and know a lot about government. So I help my friends “push the system,” as I call it.

Letting the states run Medicaid might get rid of some of the bureaucracy and allow the states to start innovations to save money.

Rosenthal on Ryan:

“give states the ability to kick people off food stamps.”

Well, way too many people are on food stamps, 46 million at last count. Maybe Rosenthal doesn’t know it, but food stamps are not run for the benefit of the poor, but to funnel money to Big Agriculture. That’s why food stamps are not run by the Department of Health and Human Services, but by the Department of Agriculture.

Rosenthal on Ryan:

“repeal most of health care reform.”

He means Obamacare, the massively expensive new socialized medicine scheme that’s going to bankrupt American medicine. Right in Rosenthal’s own New York Times, former Congressional Budget Office Director Douglas Holtz-Eakin wrote of Obamacare:

“Removing the unrealistic annual Medicare savings ($463 billion) and the stolen annual revenues from Social Security and long-term care insurance ($123 billion), and adding in the annual spending that so far is not accounted for ($114 billion) quickly generates additional deficits of $562 billion in the first 10 years.”

In another recent column, Rosenthal wrote:

“In his Monday morning column, Greg Sargent of the Washington Post wondered rhetorically whether we had actually had an election last November, since the Republicans are still putting forward the ideas that voters rejected in 2012. Representative Paul Ryan, who was on the G.O.P.’s losing presidential ticket, is about to issue yet another draconian budget plan that would start the process of killing Medicaid and turning Medicare into a voucher program.

“Sunday night, Roll Call published an interview with John Boehner, in which the speaker of the house answered Mr. Sargent’s question — we did have an election and the Republicans are oblivious to its results.”

It’s Rosenthal himself who is oblivous — to the words of the U.S. Constitution. Article I, Section 7 reads:

“All Bills for raising Revenue shall originate in the House of Representatives….”

Given that revenue is the key to any budget, that means the key part of the budget “shall originate” in the House. The House was won by majority Republicans, not Democrats. So Ryan is right to advance his budget based on who was elected to the House, not the White House.

Conclusion

As I mentioned, Ryan’s plan also is deficient. It doesn’t cut nearly enough. But the voters put him, not President Obama, in charge of the budget committee of the House, which originates revenue bills, and therefore budgets.

Given how influential Rosenthal and the Times are among Democrats, these are the talking points we’ll be hearing for months. But their points are pulled from thin air.

The country really is going broke. Raising taxes further on “the rich” only will drive more of them from the country; or if they stay, will deny the productive private sector the benefit of rich people’s investments in business and jobs creation.

Republicans still need to keep looking for a new vision. So do Democrats.