The American Spectator : The Spectacle Blog : Obama Hints at Left-Wing Alternative to Ryan Plan

Text Size

The Spectacle Blog

Obama Hints at Left-Wing Alternative to Ryan Plan

By Joseph Lawler on 9.19.11 @ 12:59PM

Since this spring, the Republican Party has been on record as supporting a set of principles for solving the country's fiscal problems, namely the ideas outline in Rep. Paul Ryan's Path to Prosperity. In short, Republicans would transition Medicare to a consumer-centered model, cut discretionary spending, and keep taxes receipts near their historical averages.

The only liberal alternative to something along the lines of the Ryan model is some form of government health care rationing coupled with massive, permanent tax increases on the upper and middle classes. Of course, neither centralized health care rationing or tax hikes poll well with the public. But neither do many aspects of the Ryan plan, yet the Republican Party rallied around it. That hasn't been true of the Democratic Party and the liberal alternative.

This morning, President Obama finally gave the nation at least a partial acknowledgement of what his plans for the fiscal future would entail. In a Rose Garden speech, Obama called upon the supercommittee tasked with cutting the deficit to embrace massive new taxes on high income earners, as well as a number of unpopular smaller measures for cutting spending on Medicare and Medicaid. While Obama's outlined plan wouldn't come close to stabilizing the government's finances, it represents a step toward Obama leveling with the public about his designs for taxes and health care.

Obama's plan calls for ending the Bush (and Obama) tax cuts for the high-income tax brackets, which translates to about a $860 billion tax increase over 10 years. Obama would then raise taxes on the well-off by another $700 billion by "limiting deductions and exclusions for those making more than $250,000 a year" and "[c]losing loopholes and eliminating special interest tax breaks." Lastly, the plan calls for a "Buffett Rule" that acts as another Alternative Minimum Tax to ensure that households earning over $1 million per year pay higher taxes (as a percentage of income) than middle-class workers. This last part, which hasn't been fully defined yet, doesn't seem to be much more than an attempt at left-wing populism on Obama's part.

On the spending side, Obama would cut $580 billion from mandatory spending by trimming around the edges of Medicare and Medicaid. In contrast to the Ryan plan, which would constitute a fundamental reform of both programs, Obama would simply try to cut costs within the existing bloated, inefficient system. Notably, his plan would "strengthen the Independent Payment Advisory Board (IPAB) to reduce long-term drivers of Medicare cost growth." IPAB is the controversial component of Obamacare that sets up a panel of experts to recommend and condemn medical procedures. By increasing its power, Obama is moving it closer to the "death panels" scenario feared by many conservatives and seniors, in which remote experts have the power to make personal decisions about individuals' health care. As Avik S.A. Roy has argued in the Spectator, the IPAB is the only realistic alternative to the Ryan plan for reducing Medicare spending.

Of course, the plan sketched out by Obama this morning has no chance of becoming law. And it won't significantly affect the deliberations of the supercommittee. What it will do is give Obama something he can use to excite the liberal base of the Democratic Party during the 2012 election. It will also, though, give Republicans a chance to point out that the alternative to the Republican-endorsed Ryan budget plan is not the status quo, but instead huge tax increases and even greater concentration of the health care market in government hands. That message has already worked in at least one election. Whether it helps define the 2012 elections will be worth watching.

Photo of President Obama, Treasury Secretary Timothy Geithner, and NEC Director Gene Sperling via the White House flickr feed.

View all comments (6) | Leave a comment

Ken (Old Texican)| 9.19.11 @ 2:48PM

Joseph,
This is all BS. What I'm worried about is the "lame duck" period in 2012...and the weeks leading up to the elections.
Keep your powder dry.

BobG| 9.19.11 @ 2:57PM

Since this spring, the Republican Party has been on record as supporting a set of principles for solving the country's fiscal problems, namely the ideas outline in Rep. Paul Ryan's Path to Prosperity.

That's a bit of an overstatement. It passed the House, in part because it was obviously going to fail in the Senate. That let some congressmen vote in favor of it without having to live with the consequences of it passing -- a time-honored kind of symbolic vote sham that both parties make use of.

Then you had Boehner and others saying things like "it's an idea worthy of consideration" and it's one idea among many and so on. It didn't help that the CBO scoring had Ryan's plan *increasing* the debt at the end of ten years. Ryan had to defend some economic projections so extremely rosy that he's gotten little support even from conservatives. Instead the focus changed to praising Ryan for putting some ideas out there, which is not the same thing as actually wanting to implement those ideas.

It's not hard to see why the GOP is reluctant to embrace the Ryan plan in any meaningful way (i.e., not just a symbolic way, but making a real attempt to implement it). Even after relying on overly rosy projections, the result is still political suicide: "No matter how favorably pollsters with the Tarrance Group or other firms spun the bill in their pitch — casting it as the only path to saving the beloved health entitlement for seniors — the Ryan budget’s approval rating barely budged above the high 30s or its disapproval below 50 percent, according to a Republican operative familiar with the presentation."

Of course, the plan sketched out by Obama this morning has no chance of becoming law.

It's also a sham, put out there for symbolic purposes without any genuine desire to actually implement it.

TrueBlue| 9.19.11 @ 7:08PM

Unfortunately it will take politicians willing to commit political suicide to pass any kind of meaningful reform, and then politicians with a pair that come after them to not repeal the measures. Sadly, this is an impossibility until the country literally hits the point of no return (nobody willing to lend us more money).

martin j smith| 9.19.11 @ 3:22PM

Some one has to say that Obama does not have a jobs bill.
The important question for the Republican party now is if they understand that Obama does not make deals and thus does not compromise. How they deal with that reality will be crucial.

Simon Templar| 9.19.11 @ 6:49PM

He has to find some way to pay for what's coming when Obamacare and the transformation hits the economy in 2014. Is this a big surprise?

What is it that you still do not get here? What will it take to make it so obvious a chimpanzee could figure it out?

He never had any intention nor the dems of compromising on anything. He tabled the Bush tax cut issue and got the stupid party to over focus on it and think they scored some big political win. He got his socialized health care, he got his insane spending, he got another blank check, he tabled the deficit issue, he successfully smeared the Tea Party, and now he is setting the narrative for reelection with the help of the stupid party and its inability to formulate and articulate an effective response.

Oh, lets us not forget the effective means by which he used once again for the millionth time the social security issue with the aid of GOP candidates and pundits to smear the GOP and conservatives as hating grandma.

The best of all for last...he steals 500 billion from medicare and intends to kill the program when Obamacare kicks in but somehow with the help of Ryan and others to effectively cover up this fact and makes the GOP the monster that wants to push granny over the cliff rather than help her with her medical bills.

He is playing the GOP right now as I write this with his antogonizing rhetoric on taxing the rich. As usual like a knee jerk and he is counting on that knee jerk response, the GOP and the author focus down on this, see nothing else, REACT like REACTIONARIES, and play right into his hands.

Instead of focusing on how stupid the idea is you should be focusing on the polical manipulation involved here and crafting an effective public education campaign and response that counters this and distracts away from his hidden accusation and turns the public's attention away from it to another narrative like his hypocrisy, corporate collusion, union money grabbing and greed, and perhaps the corruption coming forth from three scandals in one month.

What can I expect from the GOP this week? Well, I can count on them to do an excellent job this coming Thursday(the debates) in destroying it's best candidates and doing all the heavy lifting of its opposition.

It will all be done in the name that this is how we find the best candidate to beat Obama. By the time a nominee is chosen, that person will be so shot up with political holes, it will be hard to see them. You will by then have made the case that Obama really is the only "sane" choice for all those swing voters and politically retarded independents.

Timothy L. Pennell| 9.20.11 @ 9:24AM

What's the big deal? This piece is written as if it's some kind of epiphany.
He wants to TAX THE RICH. He wants to end Tax Cuts, and Raise Taxes.
You might as well have written a story about how "The SUN came up in the East, today."