Finally, someone in Congress has the fortitude to stick their neck on the line and propose an unpopular financial plan. That man is Paul Ryan, the head of the House Budget Committee. The plan is politically risky because it affects most Americans in both the short and long term, but whether or not we think so, the plan is necessary. The Congressional Budget Office (CBO) economic model crashes by the year 2037. This means, in 25 years our government and economy will not only be broke, but it will be beyond repair. The longer we wait to fix the problem, the harder the problem is to fix and the solution becomes more painful. Thus, it is necessary to act quickly.
The Ryan plan proposes to cut over 4 trillion of our 14 trillion dollars of debt over the next decade. This plan is bold because it cuts more spending than the unpopular plan proposed by the Debt Commission this past November. Democrats are already crying foul and have begun demonizing the proposal. Remember, Obama refused to incorporate any of the Debt Commission budget recommendations into his proposed budget plan for this year. Here is a summary of Ryan’s proposals:
•By 2021, the government will subsidize seniors to help pay for insurance premiums instead of enrolling them into the government run Medicare system. This change will only effect people that are younger than 55. The plan would also require the wealthiest seniors to pay more for health insurance premiums. This proposal will undoubtedly be unpopular to all Democrats who want a single payer healthcare system, especially since Ryan’s plan repeals ObamaCare. The Ryan plan also reforms Medicaid. Under Ryan’s plan the federal government will no longer cover half of the states’ Medicaid payments. States will get a flat payment based on persons enrolled in the program. This will force states to better manage the program and to implement cost saving ideas.
•The plan calls for dramatic cuts and slashing of discretionary spending to below 2008 levels. His plan also identifies and targets outdated and redundant federal programs.
•The plan calls for tax reform including lower tax rates across the board – but many popular exemptions will be eliminated. The upper individual and corporate tax rate will be decreased from 35% to 25%.
•The Ryan plan calls for 178 billion dollars in defense spending cuts identified by Secretary of the Defense Robert Gibbs.
•The plan calls for private sector realities for government civilian workers. This means no more outrageous salaries or job security.
•Surprisingly, the Ryan plan does not call for any significant changes to social security except that Congress and the President must ensure the program’s solvency. He probably thought it would be hard for Americans to accept the Medicare changes let alone more changes to another sacred entitlement - social security.
Obviously, the closer one is to 55 years old, the more this plan affects us. I am one of those of people, but this plan needs to be incorporated. Heck, I am willing to bet that retirement healthcare for those of us under 55 will be better than those enrolled in Medicare for a few simple reasons. First, there will be more doctor choice since doctors will not have a reason to opt out of seeing patients on Medicare. Secondly, there will be less bureaucracy to get claims identified and settled in a timely manner. Thirdly, there is a better chance we will have better coverage – in other words, we do not have to worry about insurance (ObamaCare) not covering certain procedures or preventative care.
My Book: Is America Dying? (Amazon.com, Barnes and Noble)