JONATHAN COHN APRIL 4, 2011
Based on what we know so far, the Republican plan for Medicare would appear to be one part hypocrisy and one part con.
Republicans have spent much of the last two years attacking President Obama and the Democrats for cutting Medicare spending, as part of the Affordable Care Act. Now those same Republicans appear to be proposing cruder, deeper cuts that would, for all intents and purposes, destroy the program.
That's the hypocrisy. And the con? That would be the ability of Republicans to hold the allegiance of senior citizens. As Paul Krugman writes today, it looks like seniors who thought voting Republican would preserve Medicare got played for "suckers."
But did they really?
The Republicans may be calling for the end of Medicare as we know it. But the end wouldn't come for another ten years. From the sounds of things, everybody who is in Medicare now and everybody who would become eligible for it before 2021 could still enroll in the traditional, government-run program with the full guarantee of benefits. And they'd get to stay on the plan for the rest of their lives. Only people who are now less than 55 years old would be part of the less secure, privatized system.
And why would Republicans do that? Matt Yglesias has one theory:
part of the plan here is that Ryan is going to promise currently elderly people that they’ll get all their currently promised benefits plus that he’ll undue the Medicare cuts that were part of the Affordable Care Act. The idea here is that today’s old people--a very white group that’s also hostile to gay rights, and thus sort of predisposed to like conservative politicians--will also get to benefit from an extremely generous single-payer health care system. But younger people--a less white group that’s friendly to gay rights and thus predisposed to skepticism about conservative politicians--will get to pay the high taxes to finance old people’s generous single-payer health care system, but then we won’t get to benefit from it. This is in part in order to clear headroom in the budget so as to make gigantic tax cuts for rich people affordable.
To be fair, I think the primary impetus for delaying implementation for a decade was a slightly different political calculation: An assessment that taking away Medicare from seniors who have it now would, in fact, kill the plan politically. But Yglesias is right about the distributional effects of ending Medicare in the way that Republicans are likely to propose.
By the way, politics and motives aside, the Republican and Democratic approaches to reducing health care spending make for an interesting policy contrast. I'll talk about those in more detail soon.
Update: Philip Klein of the Washington Examiner offers a different, more sympathetic rationale for delaying implementation by a decade:
...it's also important to emphasize that the reason why many plans for reforming entitlements exempt those at or near retirement is that older Americans have built their lives around the existing system and don't have the opportunity to adjust to changes, whereas younger workers do. One of the things that Ryan has repeatedly argued is that the reason why we need to address these problems now is that the longer we wait, the harder it will become to protect current retirees from any changes.