Choices Ahead

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American Spectator:

For weeks, Congress has been locked in a bitter stalemate over the budget. House Republicans, having promised the voters $100 billion in discretionary spending cuts during their first year in office, want to pass a continuing resolution that lops $61 billion in spending from the remaining six months of the fiscal year. The Democratic-controlled Senate, backed by the White House, prefers about $30 billion in cuts.
Last week, Senate Majority Leader Harry Reid announced that both sides had come to an agreement on the dollar figure of spending they would cut. Reid ostentatiously thanked House Speaker John Boehner for negotiating with him and mocked conservatives: "I'm sure it's not easy trying to negotiate with the Tea Party screaming in his right ear." With Tea Partiers in Washington protesting in the background, Boehner said curtly that no deal had been reached.

Even if the two parties could come together on how much to spending to cut, there would still be disagreements over which spending to cut. Should Congress defund Planned Parenthood? The Corporation for Public Broadcasting? The bureaucrats who will implement President Obama's national health care law? All three would be a no-go for Democrats in Congress and probably the president as well.

Yet the House Republican budget for fiscal 2012, due to be unveiled this week, may make all this look like penny ante stuff. House Budget Committee Chairman Paul Ryan (R-WI) told "Fox News Sunday" that the GOP budget would exceed the deficit reduction proposed by the president's fiscal commission. That would mean savings in excess of $4 trillion, as the headlines have blared since Ryan's interview, the number reached in the commission report now gathering dust somewhere in the Oval Office.

"We can't keep kicking this can down the road," Ryan said in his Fox interview. "The president has punted. We're not going to follow suit." Unlike anything the administration has been willing to seriously contemplate, the 2012 budget is going to tackle two major entitlement programs: Medicaid, which provides health care to the poor, and Medicare, which provides medical care to the elderly. The latter program is going broke; the former is driving many state governments into the poor house.

Ryan would block-grant Medicaid to the states, giving governors and legislators more flexibility. The idea is also to save money and make the program grow at a more sustainable rate. On Medicare, he would essentially give retirees vouchers to purchase private health insurance. He would retain Medicare's progressivity so that the benefits remained better for the poor and the sick. Americans already dependent on Medicare or nearing retirement would be exempt.

Sound right-wing? You'll hear as much in the coming days. But Ryan promulgated these plans with Alice Rivlin, a centrist Democrat and former Clinton budget director. Though the details of the 2012 budget have yet to be released, an analysis done last year by the Congressional Budget Office found that the Ryan-Rivlin plan would save $350 billion over the next decade.