U.S. Rep. Paul Ryan (R-WI) unveiled his latest budget plan amid a lot of GOP fanfare today, renewing his sweeping proposals to slash government spending, reform the tax code, and overhaul the social safety net. The plan is woefully lacking in key details, and House Republicans admit that it has virtually no shot of passing the Democrat-controlled Senate. Rather than present a viable plan for federal spending, the budget is essentially a political document, laying out a blueprint for Republicans going into the 2012 election.
The problem, paradoxically, is that the plan is political Kryptonite.
Republicans have apparently forgotten what a disaster Ryan’s plans caused the first time around. Democrats seized on Ryan’s inaugural budget plan — in particular his proposal to overhaul Medicare — and effectively used it to cast Republicans as Enemy No. 1 for American’s Senior Citizens. The attacks were key to the Democrats’ surprise special election upset in New York last May, and the party is gleefully preparing to run it back with the Ryan Plan Part II.
To be fair, the proposed changes to Medicare are tempered in the latest Ryan budget. Instead of full privatization, the new plan proposes partial privatization that allows seniors to opt for traditional Medicare coverage.
Adopted from Ryan’s collaboration with Rep. Ron Wyden (D-OR), the new Medicare proposal would create competitive Medicare exchanges, with the level of premium care determined by the second least-expensive plan. Seniors who opt for the cheaper plan get a rebate, while those who chose more expensive plans have to cover the difference themselves.
Interestingly, the idea of Medicare exchanges mirrors the insurance exchanges established by Obama’s healthcare reform law. And like Obamacare, Ryan’s plan caps premium support growth at GDP + 0.5%.
These Obamacare parallels, and the proposal’s nominally bipartisan genesis, might provide Republicans a little cushion to deflect Democratic attacks. But it probably won’t help much.
Voters’ rejection of the first Ryan plan last spring suggests that Medicare remains the third rail of American politics, even when the political climate is favourable to spending cuts. Consequently, it will be infinitely easier for Democrats to use the Ryan plan to turn seniors against the GOP than it will be for Republicans to try and explain why the plan isn’t that scary after all.
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