There are a lot of things to say about Rep. Paul Ryan’s budget plan. I’d like to focus on one word: hammock.
As in the Wisconsin Republican’s comparison of his proposal to welfare reform enacted during the 1990s. “This budget,” Ryan proclaimed, “extends those successes . . . to ensure that America’s safety net does not become a hammock that lulls able-bodied citizens into lives of complacency and dependency.”
Let’s examine that hammock, and the flawed analogy to welfare reform. If you think, as House Budget Committee Chairman Ryan seems to, that the safety net is a comfy chair, consider these facts:
l Adults without children get no federal help for health coverage, even if they are living below the poverty level ($10,890 in 2011). The health-care law would expand Medicaid coverage to poor childless adults in 2014, but, of course, Ryan would undo that change.
l The average household receiving food stamps gets about $133.70 a month ($4.46 a day) for each family member, according to the Center on Budget and Policy Priorities. To be eligible for food stamps, a household’s income must be no more than 130 percent of the poverty level ($23,800 for a family of three). Except during economic downturns, childless adults generally are limited to three months of help.
l Half of Medicare beneficiaries had incomes less than $21,000 in 2010, according to the Kaiser Family Foundation. That low figure is skewed in part because of the paltry median income ($14,387) among Medicare recipients with disabilities, but the median income among those 65 to 74 was just $26,255. Americans older than 75 live on even less.
The sensible theory behind welfare reform was to change the incentives of the system to make welfare “a second chance, not a way of life,” as Bill Clinton said in signing the measure in 1996. There is little in the current structure of the safety net programs that Ryan proposes to overhaul — a better word might be shred — that replicates welfare’s original flaws, and little in his reshuffling that would address the culture of dependency he claims to be targeting.
I write this as someone who has repeatedly insisted on the importance of dealing with the long-term deficit and has praised people such as Ryan for at least putting a plan on the table. But Ryan’s plan, as much as he says he wants to weave “a strengthened safety net for the poor and the sick,” is fundamentally unbalanced. Painful cuts will be required to put the country on a sustainable fiscal path. Nothing justifies spending nearly $700 billion to extend tax cuts on the wealthiest Americans while cutting even more, $771 billion, of health care for the poorest.
Ryan says he would transform Medicaid into a block grant for states — but the amount would grow only with population and overall inflation. Because health care costs have tended to grow faster, the states over time would inevitably end up cutting poor people off their rolls and limiting benefits for the ones who remain. In a downturn, with state budgets strapped and more people in need, the change would hit hardest, in contrast to the current countercyclical effect of Medicaid. He would turn the food stamp program into a block grant as well, with similarly perverse effects.
I’m more open to the notion of restructuring Medicare to be, in effect, a voucher program under which beneficiaries would shop among competing insurance plans. The existing fee-for-service model in which the government foots the bill for unlimited care is not sustainable. Some seniors ought to be asked to pay more for their coverage.
But Ryan’s vouchers would rise only with overall inflation, meaning that over time insurance would become less and less affordable. This is particularly troubling given the skimpy income of the average Medicare recipient and the Congressional Budget Office estimate that the out-of-pocket cost for a typical 65-year-old in 2022, when the program takes effect, would more than double, from $6,150 to $12,500. Ryan would also gradually increase the eligibility age to 67. Where, exactly, are 65- and 66-year-olds without health insurance supposed to be able to find an affordable policy, especially after Ryan and Republicans undo the new health care exchanges?
Ryan worries about the hammock and the culture of dependency. I worry about the family on the street and a government unable — or unwilling — to fulfill one of its core missions.