Slashing The Federal Budget
http://thedianerehmshow.org/shows/2011-04-05/slashing-federal-budget
House Republicans release a 2012 budget proposal today. It cuts more than $6 trillion from the overall budget over the next ten years, essentially ends Medicare as we know it, and makes dramatic cuts to Medicaid. The plan is also likely to include reductions to the top tax rate for both individuals and corporations. President Obama and lawmakers from both parties have said federal deficits cannot be brought under control without changes to Medicare, Medicaid and Social Security, but critics of the Republican plan say it puts the deficit burden squarely on the nation’s most vulnerable citizens. Join us for a conversation about the GOP 2012 budget plan and its implications for the overall budget process.
Guests
Alice Rivlin
senior fellow, Brookings Institution, vice chair, Board of Governors, Federal Reserve System (1996-99); director, White House Office of Management and Budget (1994-96); and founding director, Congressional Budget Office (1975-83).
Ron Pollack
executive director of Families USA, a national non-profit organization for health care consumers.
Gail Wilensky
economist, senior fellow at Project HOPE; former administrator of Medicare and Medicaid and health policy adviser in the George. H.W. Bush Administration.
Tom Daschle
distinguished senior fellow, Center for American Progress
special policy adviser, law firm of Alston & Bird
former Democratic Senator from South Dakota.
Comments
Please familiarize yourself with our Code of Conduct and Terms of Use before posting your comments.
During the gigantic and widely devastating Macondo Gulf oil leak I was astounded to hear former US president Bill Clinton considering a nuclear device as the ultimate remedy to stop it.
"Feel-yer-pain" Clinton is no engineer and neither are T-partiers and other ultra conservatives in Congress social scientists. Radical cuts are intended to annihilate the federal government so that it will no longer impede the needs of corporate business (and inconsequentially "small" business) with oversight or regulation. This one goal and vision excludes any consideration of any concomitant results.
I'm one who is quick to criticize the military-industrial-Congressional-corporate welfare-global tax exemption complex.
Many T-partiers seem to share my critique, but while being in a position (federal office) to begin remedying this anomaly they prefer instead to threaten the stipends of the elderly, disabled and disadvantaged while cutting back on environmental safeguards, education and block grants that enrich local life through state and local government. All this while military and intelligence spending remain the larger outlays. If one knows intuitively and by observation that this big pink elephant also benefits from scaring the people one can surmise we are not in such a dire terrorist danger as they insist. Imagine the outcome if subsistence checks, poverty medicine, schools and culture funding disappear while propaganda and surveillance continue curtailing freedom and expression. What kind of life quality would result? I doubt wages would rise, but probably fall in buying power, under such a regime, without regulation. Now that's an ugly tableau! As for "Defense" our military is as much an ill will machine and domestic liability as it is "Our Team." People are too caught up in a professional sports model where mass murder is the game.
And then there remains what amounts to a socially conservative
minority's personal privacy issues. I think abortion rights, same-sex unions, state religion and so on are wedge issues used to divide people on common pocketbook issues. From their private behavior we often observe our representatives are no paragons of virtue, so why would they otherwise care? I can't envision an outcome where we'd be jailing people for blasphemy or kissing in public as some old fogeys might. The T-party is not quite as Medieval as the Taliban. (Even the Taliban is not as Medieval as we might assume and the Lawerence Welk Show was a hotbed of sexual intrigue.) When granny sends a wayward boy to military school he might get more randy while learning to conceal his bad habits in the presence of authority. So legislative social repression as envisioned can only breed hipocricy and isolated untreated suffering. Look at the overwhelming tendencies of capitalist business and consumer culture to understand how insane socially conservative ideas really are. We do need help and intervention for excesses but this itself is a matter for business regulation, not contradictory totalitarian enforcement. Look at the religious police in Saudi Arabia: How nutty is that?
We live in an increasingly complex interdependent environment with decreasing easy resources, water and arable land. Right now grain reserves are measured in weeks. Any disruption could kill billions, and maybe everyone. We are veritably packed in close quarters. Is it time to load up and get greedy, or time to reason and cooperate? This won't happen without a much better federal government than at present. If we want to survive capitalism and elitism must change radically. Cutting ourselves is not a solution.
If Medicaid funding is reduced, that won't change the fact that poorer people will still get injured and they will still get sick. Arguably, they will be less likely to get preventive care or early diagnosis and treatment, which may ultimately increase the cost of their care. And, when they finally arive at the doctor's office or emergency room, they won't be turned away. That's the law.
Medical providers recoup uncompensated medical expenses in the form of government payments and higher charges for those who can pay. For this reason, it seems to me that slashing federal Medicaid payments won't reduce the cost of health care for the poor. If the federal government contributes less, then the states and those who can afford healthcare will end up paying more. And if higher healthcare costs means fewer people will have insurance, the amount uncompensated care may actually increase. How is this a solution?
Why are so many praising Paul Ryan? His Medicare privatization vouchers would not cover the same kind of plan Medicare currently provides and the amount is set to decrease over the years. Forcing people to give their tax dollars to for-profit insurance companies that will use a lot of it for advertising and profit for their shareholders.
Other advanced countries pay far less per person than we do, in large part because they have rejected more costly for-profit insurance. Contrary to conventional wisdom many of them do not have a single-payer system, but have multiple private not-for-profit insurance companies from which to choose. These companies cannot deny anyone coverage or charge exorbitant rates because of higher risk or existing conditions. They also have much lower rates of things like infant and maternal mortality than we do with our "world's best health care system".
Vouchers are a fraud. They are next to useless for the people who most need help, but benefit the better off.
With school vouchers where will a poor kid with a $3,000 voucher find the other $7,000, say, to top it up and get into a decent school? Seniors will be in the same boat - Ryan would subsidize people with means to buy Cadillac health insurance, but those who can't afford to top up will be stuck with the bare bones which, if they are lucky, might buy them an insurance of questionable benefit.
Yet another example of Republicans steering more wealth from the have-nots to the haves.
Is there *anyone* outside the Tea Party who really wants end of life decisions taken out the hands of the elderly, their families and their physicians and put into the hands of low level faceless insurance company employees who use their company bottom line for literally making death decisions?
Death panels (were they not a fiction) at least would have involved a panel of experts.
One of the reasons for rising costs of medical care in this country is the presence of a huge, for profit industry whose only contribution is a blizzard of paperwork, in exchange for which they skim a portion of every claim. No company would stay in business by allowing money to bleed away like this. Why is this so difficult to see?
Good. Medicaid needs to be reformed. even poor people need to contribute something to their healthcare, eligibility needs to be trimmed and the process of old people giving their wealth to their kids so they can qualify for Medicaid needs to be done away with.
End of Life Decisions: are currently made by for-profit insurance firms. Max out your benefits, regardless of your prognosis, you receive no more insurance benefits. FOR PROFIT insurance firms will not act altruisticly.
Let's see: we have a greater income gap in the US since the late 1800s (reports from Princeton/Yale) and we have a lower tax rate on the wealthy then ever before. We have granted person-hood status to corporations without the contraints most individuals face.
Now, in addition to Republican Governors reducing taxes and increasing costs on a state basis for the poor, the senior and working people, we now have the National Republican party seeking to do the same thing.
Yes, Fed gov is fraught with waste, but these actions taken will result in civil unrest. Our children are already predicted to have lower incomes for life than their parents (including people with college degrees).
You paint the picture, you will see the logical resulst.
this conversation is exactly what's wrong with this country. Why won't the republicans address corporate welfare. That seems a way to slash billions from the budget, without hurting anyone. There are 7 tea partiers who
have received millions of dollars in farm subsidies, yet they glow when they talk of taking away money for the poor.I guess, welfare for me is fine, and everyone else.......
this conversation is exactly what's wrong with this country. Why won't the republicans address corporate welfare. That seems a way to slash billions from the budget, without hurting anyone. There are 7 tea partiers who
have received millions of dollars in farm subsidies, yet they glow when they talk of taking away money for the poor.I guess, welfare for me is fine, and everyone else.......
I only hear speakers talking of shifting Govt obligations for services working americans have paid for with payroll taxes.
If we are shifting obligations to americans are we cutting taxes paid for thru FICA?
i see no reason to change current program until Congress comes up with a solution to 'borrowing' from payroll taxes paid be both employee and employers? How is Congress going to do this?
And parital credits for Health Care? Then why are we paying payroll taxes?
The federal medicaid and medicare programs has the highest risk pool of people. That is why it is in the public sector. In a for profit private sector where the outcomes are financial rather than better healthcare, it is likely that the most vulnerable population are going to be paying more by way of both money and health.
Next, how are we going to regulate that better healthcare is provided in the private sector when regulation is viewed ideologically as restrictive.
The reality is that the only way to reduce healthcare cost without compromising better healthcare is through the single payer system. This country will have to wait until ideology recognizes reality.
The cost of the American medical-industrial complex ($2.49 trillion) is not determined by any administrative mechanism (Medicare, Medicaid, indemnity insurance, TPAs, ASOs). The cost is determined by the physician and his/her practice patterns.
Attempting to limit the "cost" of care for one group simply shifts the cost of providing care to those able to pay (e.g., higher insurance premiums to cover losses for uncompensated care). The discussion must change from a focus on "coverage" to a dedication to system reform/re-design.
Tinkering with the insurance financing mechanism will do nothing to address our health care crisis.
Congress must recognize that the central problem in the American health care system is the physician's decision making process. Half American health care is not medically necessary, harmful or fraudulent.
Until Congress addresses total reformation of our health care system, our economy will continue to circle the drain.
The Diane Rehm Show has a manuscript copy of "Discovering the Cause and the Cure for America's Health Care Crisis" - my book that addresses the problems now being discussed on this show.
Roger H Strube, MD
www.rogerhstrubemd.com
Why would an Insurance company want to insure the elderly or the sick poor, without a ridiculously high premium? Aren't we just going back to the way things were before Medicare and Medicaid were implemented, but just sugar coating it by giving a little money to sugar coat it?
It is sickening to listen to all these comments re health insurance. Congressmen Ryan will never have to use medicare. His income will ensure that. With the proposed plan, I can see 80 year olds, trying to figure out where they would use their vouchers for that particular year. Nice prospect for the "GOLDEN YEARS". Why can't we like most advanced countries hold health care as a right? People don't get sick because they are irresponsible(although, with our current diet, this may not be totally true). However, with the medical profession(mainly doctors) and the "for profit" insurance and hospitals, I don't see much hope. UNLESS WE THE PEOPLE STAND UP AND PROTEST.
The Rush Limbaugh of public radio Diane Rehm. Just like Rush you always know how an issue is going to be spun.
I would like to hear the guests comment on the fact that market logic requires that for-profit health care has to be more expensive and less successful (i.e. mirroring current US health care history) than non-profit. Maintaining good health will certainly save a lot of money, but it is very difficult for it to earn a profit. Market forces normally depend on a product that fills a perceived need and maintaining good health is not as compelling a perceived need as being cured when you are sick. I strongly believe that making health care non profit, by whatever public or private means, would save us trillions of dollars (in taxes, premiums and for service fees) in unnecessary health procedures.
I would like to hear the guests comment on the fact that market logic requires that for-profit health care has to be more expensive and less successful (i.e. mirroring current US health care history) than non-profit. Maintaining good health will certainly save a lot of money, but it is very difficult for it to earn a profit. Market forces normally depend on a product that fills a perceived need and maintaining good health is not as compelling a perceived need as being cured when you are sick. I strongly believe that making health care non profit, by whatever public or private means, would save us trillions of dollars (in taxes, premiums and for service fees) in unnecessary health procedures.
I would like to see what would happen to health insurance costs if we raised the medicare age to 67. I think all premiums would rise.
Has the panel opined on whether the increasing cost of healthcare is a result of the structure of the system (how and how much care is delivered; who gets paid for doing what) or what organization is paying the bills? Doesn't that determine what needs to be changed, who pays (Ryan Plan) or how the system is structured (which requires a national change)?
Thank you, Roger Strube. I agree with you completely. I hope to read your book soon.
Recently in the NY Times, David Kocieniewski reported that GE had profits of $14.2 Billion in profits last year and by keeping its porfits offshore, and with tax breaks , it claimed a $3.2 billion refund from the government.
Before we talk about this kind of budget austerity causing untold suffering by many, let's talk about closing loopholes to businesses.
We live in a country that has been so generous to these big businesses that have allowed them to be successful. "Where much is given much is expected." Where is the gratitude for their blessings?! They should do their share to give back to their fellow Americans less fortunate.
Defined contribution Medicare is just another Republican swindle:
Private health insurance at age 64 = $20,000/year
Medicare cost, currently = $8500/year
So under Ryan's plan, Medicare pays $3000, senior pays $17,000, and the health insurance company makes $3000 profit !
Who is he kidding?
Please ask the panel why they keep holding up the federal health plan as a model when the premium costs in that plan go up just as fast as overall health costs? All federal employees have is more choice assuming you live in a major metropolitan area.
I object to some of the budgetary euphamisms used in the healthcare debate (and actually in other policy debates). While any policy decision is open to debate and resolution I feel that the debate must include a clear statement of what will be told to individuals in need who will be excluded from benefits. An example would be your earllier discussion of Medicaid funding for long term care...If this funding is reduced, a clear statement of policy for those who would be affected should be provided. If we picture a bed-ridden, feeble individual, with insufficent income to pay for care the policy should state what the facility will do with that person when they can no longer pay. This, of course is just one example.
My regards to Dr. Rivlin. I used one of her books in an undergraduate public budgeting course waaayyy too long ago to be polite to mention the exact year.
Until Congress quits taking orders from Wall Street, all this debate us just bla, bla, bla....
Oh, get us out of other countries and these senseless wars!
From the NY Times:
The ambitious plan, drafted principally by Representative Paul D. Ryan, the Wisconsin Republican who chairs the Budget Committee, proposes not only to limit federal spending and reconfigure major federal health programs, but also to rewrite the tax code, cutting the top tax rate for both individuals and corporations to 25 percent from 35 percent, reducing the number of income tax brackets and eliminating what it calls a “burdensome tangle of loopholes.”
http://www.nytimes.com/2011/04/06/us/politics/06budget.html?hp
Darn! I really wanted to catch all this... My biggest question is not re pulling Medicare / Medicaid and Social Security into the discussion, it will have to be pulled in eventually. But why, why, why isn't Defense being discussed. $738 billion currently could and should be cut by 1/3 at least.