Mediscare

MEDICARE AND MEDISCARE
by
Paul Krugman


Op-Ed Contributor: Squandering Medicare’s Money (May 26, 2011) Readers' Comments
"Ryan’s plan is a shell game at best


To be sure, Mr. Ryan had reason to be upset after Tuesday’s special election in New York’s 26th Congressional District. It’s a very conservative district, so much so that last year the Republican candidate took 76 percent of the vote. Yet on Tuesday, Kathy Hochul, a Democrat, took the seat, with a campaign focused squarely on Mr. Ryan’s plan to dismantle Medicare and replace it with a voucher system.

How did Ms. Hochul pull off this upset? The Wisconsin congressman blamed Democrats’ willingness to “shamelessly distort and demagogue the issue, trying to scare seniors to win an election,” and he predicted that by November of next year “the American people are going to know they’ve been lied to.”

You can understand Mr. Ryan’s bitterness. He has, after all, experienced quite a comedown over the course of the past seven weeks. Until his Medicare plan was rolled out in early April he had spent months bathing in warm approbation from many pundits, who had decided to anoint him as an icon of fiscal responsibility. And the plan itself received rapturous praise in the first couple of days after its release.

Then people who actually know how to read a budget proposal started looking at the plan. And that’s when everything started to fall apart.

Mr. Ryan may claim — and he may even believe — that he’s facing a backlash because his opponents are lying about his proposals. But the reality is that the Ryan plan is turning into a political disaster for Republicans, not because the plan’s critics are lying about it, but because they’re describing it accurately.

Take, for example, the statement that the Ryan plan would end Medicare as we know it. This may have Republicans screaming “Mediscare!” but it’s the absolute truth: The plan would replace our current system, in which the government pays major health costs, with a voucher system, in which seniors would, in effect, be handed a coupon and told to go find private coverage.

The new program might still be called Medicare — hey, we could replace government coverage of major expenses with an allowance of two free aspirins a day, and still call it “Medicare” — but it wouldn’t be the same program. And if the cost estimates of the Congressional Budget Office are at all right, the inadequate size of the vouchers — which by 2030 would cover only about a third of seniors’ health costs — would leave many if not most older Americans unable to afford essential care.

If anyone is lying here, it’s Mr. Ryan himself, who has claimed that his plan would give seniors the same kind of coverage that members of Congress receive — an assertion that is completely false.

And, by the way, the claim that the plan would keep Medicare as we know it intact for Americans currently 55 or older is highly dubious. True, that’s what the plan promises, but if you think about the political dynamics that would emerge once Americans born a year or two too late realize how much better a deal slightly older Americans are getting, you realize that this is a promise unlikely to be fulfilled.

Still, are Democrats doing a bad thing by telling the truth about the Ryan plan? “If you demagogue entitlement reform,” says Mr. Ryan, “you’re hastening a debt crisis; you’re bringing about Medicare’s collapse.” Maybe he should have a word with his colleagues who greeted the modest, realistic cost control efforts in the Affordable Care Act with cries of “death panels.”

Anyway, the underlying premise behind statements like that is the assumption that the Ryan plan represents a serious effort to come to grip with America’s long-run fiscal problems. But what became clear soon after that plan was unveiled was that it was no such thing. In fact, it wasn’t really a deficit-reduction plan. Once you remove the absurd assumptions — discretionary spending, including defense, falling to Calvin Coolidge levels, and huge tax cuts for corporations and the rich, with no loss in revenue? — it’s highly questionable whether it would reduce the deficit at all.

What the Ryan plan is, instead, is an attempt to snooker Americans into accepting a standard right-wing wish list under the guise of deficit reduction. And Americans, it seems, have seen through the deception.

So what happens now? The fight will shift from Medicare to Medicaid — a program that has become an essential lifeline for many Americans, especially children, but which in the Ryan plan is slated for a 44 percent cut in federal aid over the next decade. At this point, however, I’m optimistic that this initiative will also run aground on popular disapproval.

What of Mr. Ryan’s hope that voters will realize that they’ve been lied to? Well, as I see it, that’s already happening. And it’s bad news for the G.O.P.