Final Proof of Democrat Decline


ACRU Staff


October 18, 2012

This column by ACRU General Counsel and Senior Fellow for the Carleson Center for Public Policy (CCPP) Peter Ferrara was published October 17, 2012 on The American Spectator website.

Yes, take Barack Obama’s advice and read the transcript of the Vice Presidential debate last week, as I did. In the black and white pages, without Biden and Raddatz trying to shout Ryan down, Ryan’s well-informed points and arguments shine through even better, while Biden’s disgraceful serial dishonesty is more clearly exposed, without the surrounding brown shirt bluff and bluster.

Biden seemed to be following a strategy of “catch me if you can,” unconstrained by truth and reality. The strategy is say whatever you have to so that you seem to win the point of contention at the moment, regardless of how divorced from reality those statements may be. Then let your opponents go nuts trying to communicate your errors to the public, through the fog of the Democrat Party controlled, so-called mainstream media, knowing they will never be on any nearly such big stage again. That can only be considered dishonorably dishonest and disrespectful abuse of the average voter and viewer.

Medicare Meltdown

The point was probably best illustrated in the debate over Medicare. Ryan discussed Obamacare’s Independent Payment Advisory Board, saying:

And they put this new Obamacare board in charge of cutting Medicare each and every year in ways that will lead to denied care for current seniors. The board, by the way, it’s 15 people, the President’s supposed to appoint them next year. And not one of them even has to have medical training.

Biden said in response:

You know, I heard that death panel argument from Sarah Palin. It seems every Vice Presidential debate I hear this kind of stuff about death panels.

Ryan never used the term death panels or referred to Sarah Palin. Biden here was trying to appeal to the prejudice of his party’s base, rather than responding to Ryan’s point with logic. To the average viewer, it would seem that Biden is actually denying what Ryan said was true. But Ryan was 100% accurate. As established in the Obamacare law, the Independent Payment Advisory Board, composed of 15 appointed, unelected, unaccountable Washington bureaucrats, has the power to impose further Medicare cuts each year, beyond the $716 billion adopted directly in the Obamacare legislation, to the payments to doctors and hospitals providing health care to seniors on Medicare. Moreover, those cuts automatically go into effect without approval from Congress. And if those payments are not sufficient to cover the costs of such health care, then seniors are not going to get the health care. The Chief Actuary of Medicare has said as much, but it just stands to reason.

Biden added:

But let’s talk about Medicare. What we did is, we saved $716 billion and put it back, applied it to Medicare. We cut the cost of Medicare. We stopped overpaying insurance companies, doctors and hospitals. The AMA supported what we did. AARP endorsed what we did. And it extends the life of Medicare to 2024. They want to wipe all of this out.

Obama and Biden are figuring that voters will not remember that when Obama was trying to get Obamacare passed, he barnstormed the country promising voters that it will not increase the deficit, relying on a CBO score to that effect. But that score was based on the $716 billion going into Obamacare. Otherwise, Obamacare would have a deficit of $716 billion. But if the $716 billion is used to finance Obamacare and make it deficit neutral, obviously it can’t also, as Biden claimed, be put back and applied to Medicare, to pay Medicare benefits. Can you use the same $716 to pay your rent, and also to make your car payment and pay the utility bills? That is the logic of Obamanomics, which Biden tried to pawn off to voters in the debate. Both CBO and the Medicare Chief Actuary have called out the Obama Administration for this illogic.

Indeed, Medicare’s Chief Actuary Rick Foster has warned that with that $716 billion in Medicare cuts, by the end of this decade Medicare will be paying less to doctors and hospitals for health care for seniors than Medicaid pays for health care for the poor. But the poor cannot reliably get timely and effective care with what Medicaid pays, and suffer worse health outcomes as a result, including early death. That is the future now for seniors on Medicare, raided to pay for Obamacare. That is not just stopping overpayments to doctors and hospitals under Medicare, as Biden tried to claim

The AMA did not support these cuts. Obama bought their silence with the promise to reverse the cuts after Obamacare was passed, and he has successfully fooled the voters. The AARP has always been a Democrat party political activist front group, and was further bought off with favoritism in the legislation for the products it sells to seniors, worth billions a year.

Ryan accurately explained,

Here’s the problem. They got caught with their hands in the cookie jar, turning Medicare into a piggy bank for Obamacare. Their own actuary from the Administration came to Congress and said one out of six hospitals and nursing homes are going to go out of business as a result of this.

Biden interrupted: “That’s not what they said.” But that is what they said. Forbes columnist Avik Roy in his October 12 column quoted directly from the Congressional Testimony of Medicare Chief Actuary Rick Foster: “roughly 15 percent of Part A providers would become unprofitable within the 10-year projection period.”

Ryan then said, “7.4 million seniors are projected to lose their current Medicare Advantage coverage they have. That’s a $3,200 benefit cut.” Biden interrupted: “That didn’t happen. More people signed up for Medicare Advantage after the change.”

But the change they are talking about hasn’t even happened yet. Indeed, Obama delayed the initial implementation of it until after the election, precisely because Ryan is right. Medicare’s Chief Actuary again reports exactly what Ryan said, “We estimate that in 2017, when the [Medicare Advantage] provisions will be fully phased in, enrollment in MA plans will be lower by about 50 percent (from its projected level of 14.8 million under prior law to 7.4 million under the new law).”

Shouting Ryan Down

Ryan explained his proposed Medicare reforms during the debate as follows:

Here’s what we’re saying: give younger people, when they become Medicare eligible, guaranteed coverage options that you can’t be denied, including traditional Medicare. Choose your plan, and then Medicare subsidizes your premiums, not as much as for the wealthy people, more coverage for middle-income people, and total out-of-pocket coverage for the poor and the sick.

Choice and competition. We would rather have 50 million future seniors determine how their Medicare is delivered to them instead of 15 bureaucrats deciding what, if, when, where, they get it.

The supposed moderator Martha Raddatz then asked Ryan: “What is your specific plan for seniors who really can’t afford to make up the difference in the value of what you call a premium support plan and others call a voucher.” But both Biden and Raddatz then interrupted and talked over Ryan so much, it is doubtful anyone understood the answer.

Ryan did get out the correct answer: “Hundred percent coverage,” as reported in the transcript. But here is why that is correct: Ryan’s plan would empower seniors 10 years from now with the freedom to choose among private health insurance plans to provide at least the same benefits as Medicare, or to stay in Medicare as today (which continues to guarantee the same benefits as Medicare today). If the seni
or chooses a private plan, Medicare pays a premium support payment to that chosen plan to help pay for it. If the senior chooses a more expensive plan, the senior must pay the difference.

But the amount of the premium support payment is set by competitive bidding among all the plans at an amount sufficient to pay 100% of the premium of the two lowest cost plans. So every senior would continue to have the choice of at least two health insurance plans in their area, plus Medicare. Ryan’s plan also provides more in premium support payments to lower income and sicker seniors so that they will enjoy even more cost-free choices, and be assured of full protection.

What this involves is merely extending the more modern, highly successful and popular Medicare Parts C and D to the old-fashioned Medicare Parts A and B. Medicare Part D is the prescription drug plan, which provides precisely premium support payments to the private health plan of each senior’s choice. That competition has resulted in program costs 40% below original projections. Part C is Medicare Advantage, under which one fourth of seniors have already chosen private health insurance to provide their Medicare benefits at no extra cost to them, because they believe they get better benefits from those private plans.

The Ryan reform plan originated in a proposal from two long time liberal academics, Henry Aaron of the Brookings Institution, and former CBO Director Robert Reischauer. That proposal was picked up by the Clinton Medicare reform commission chaired by former Democrat Senator John Breaux. The first Director of CBO, long time liberal academic Alice Rivlin, not only has supported the Ryan plan, but contributed to its development. Today, the Senate version of Ryan’s Medicare reform is sponsored in the Senate by Ron Wyden, liberal Democrat from liberal Oregon.

But at the debate, Biden interrupted Ryan to falsely assert, “There’s not one Democrat that endorses it,” despite the above long Democrat history with the reform concept. Biden interrupted again to falsely claim that Wyden no longer supports the Senate companion bill for the Ryan reforms, which he himself introduced and does continue to support. When Ryan brought up Rivlin, Biden falsely claimed that she has renounced it, though quite to the contrary, she has recently reaffirmed it. When Ryan tried to explain that the idea came from the Clinton Medicare Reform Commission, Biden interrupted to say that it was rejected, even though Clinton never rejected the recommendations of his own Medicare Commission.

But Biden had his own idea, saying, “if they just allowed Medicare to bargain for the cost of drugs like Medicaid can, that would save $156 billion right off the bat.” When Ryan explained that central planning bargaining would deny seniors choices, Biden asked, “Look, folks, all you seniors out there, have you been denied choices? Have you lost Medicare Advantage?”

Silly question, because the reform that Biden raised has never been passed, so how could it already be denying seniors choices? Moreover, CBO has already scored Biden’s proposal, concluding that it would result in “negligible” savings.

Tall Tax Tales

Biden proclaimed at the debate:

And instead of signing pledges to Grover Norquist not to ask the wealthiest among us to contribute to bring back the middle class, they should be signing a pledge saying to the middle class we’re going to level the playing field; we’re going to give you a fair shot again.

Grover Norquist is President of Americans for Tax Reform, which sponsors a tax pledge that promises not to increase taxes on anyone, not just the wealthy. Moreover, CBO reports that in 2009, when Obama entered office, the top 1% earned 13% of the income, but paid 39% of all federal income taxes. When President Reagan entered office in 1981, the share paid by the top 1% was less than half as much at 17.6%. There is no question of the wealthy not contributing. America suffers the most progressive income tax system in the world.

The top 20% in 2009, earning over $74,000 a year in income, paid 94% of all federal income taxes on net, according to the CBO. The middle 20% earned 15% of before tax income, but paid just 2.7% of all federal income taxes on net. The bottom 40% of income earners as a group on net paid zero income taxes to support the federal government. They instead were paid cash by the IRS equal to 10% of federal individual income taxes.

Moreover, in 2009, again the year Obama entered office, the top 1% paid an average federal tax rate of 29%, the middle 20% paid an average federal tax rate of only 11.1%. the bottom 20% paid an average federal tax rate of 1%, again according to CBO. How is this not a level playing field for the middle class?

Finally, Biden falsely repeated the Obama fabrication that the Romney tax plan proposes to raise taxes on the middle class, when the plan actually proposes only numerous tax cuts for the middle class. Biden interrupted Ryan to argue that Romney’s tax plan was “not mathematically possible.” But Forbes columnist Roy correctly reported on October 12: “As Ryan correctly noted, six studies back up Romney’s math: Matt Jensen of AEI, Alex Brill separately of AEI, Stephen Entin and William McBride of the Tax Foundation, Chris Dubay of Heritage, Martin Feldstein of Harvard, and Harry Rosen of Princeton.” Indeed, Biden falsely cited the AEI study as supporting him.

Can you see why I say that Biden was disrespectful of the voters’ intelligence, disgraceful, and even dishonorable? Can you imagine Jack Kennedy behaving like Biden? Or Lloyd Bentsen? Even Bill Clinton was more honest. What Biden reflected is the decline of the Democrat Party, taken over by Marxist extremists. Check out some of these inner city Democrat office holders and what they are saying. George McGovern would be a right winger in this party.



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