Medicare

My column this week in the Sky Hi Daily News

Mitt Romney's pick of Rep. Paul Ryan for VP risks losing some seniors'votes. Ryan had authored a controversial plan that altered Medicare. Until Ryan was picked, Romney had one goal: to repeal Obamacare. A GOP strategy was to frighten seniors by claiming an Obamacare panel would pull the plug on them or would cut their benefits. Romney now says his plan is like Ryan's, but fear not: no one over 55 will see any changes. Horsefeathers.

Ryan's plan is part of his deficit reduction proposal. The President's plan to save Medicare is a part of Obamacare. The major difference is that the Ryan plan to save Medicare will cost current and future seniors out of pocket money and Obamacare puts more of the burden on service provider hospitals, doctors, and insurers.

The Ryan plan partially privatizes Medicare, changing Medicare from a fee for service system to a subsidized purchase of private insurance, though seniors could choose traditional Medicare. Both Ryan/Romney and Obamacare set the same limits on future spending growth.

Here is how Romney/Ryan plans will impact us already on Medicare:

Romney's more recent mediscare infers Obama will steal $716 billion from Medicare benefits. Ironically, Ryan's plan keeps the same $716 billion in cuts but Romney said he would restore them. Romney/Ryan would repeal Obamacare. Romney had been vague on a replacement until last week when he embraced Ryan's plans. By repealing Obamacare, Romney/Ryan would immediately raise the cost of drugs to seniors by re-opening the donut hole, make seniors pay cancer screenings and wellness checks co-pays, and shorten the life of our current Medicare system.

Obamacare cuts no benefits. Much of Obama's cuts to Medicare will be taken from subsidies for insurance companies to administer Medicare Advantage; the rest result from vigorous prosecution of fraud and efficiencies required of the providers such as elimination of duplicate tests and reducing reimbursement to hospitals. Medicare Advantage is a combined Medicare and supplemental plan that is continuing successfully this year without prospects of a subsidy. Insurers just became more efficient. The participating private insurers had tacked on 14% more than what it would cost the government to administer Medicare themselves. These savings are already being used this year to close the donut hole which will be phased out completely by 2020, to eliminate co-pays for cancer screenings and check ups, and to extend the life of Medicare for eight years, making it solvent until 2024 instead of going broke in 2016.

GOP talkers still scare seniors by claiming an appointed panel would make decisions about limiting coverage. The Obamacare law prohibits that from happening. Any reference to end-of-life counseling was deleted from the law and included was a clause forbidding the panel from “any recommendation to ration health care … or otherwise restrict benefits or modify eligibility criteria.”

Ryan would also cut Medicaid by 30%. Hit hard would be poor seniors who depend on Medicaid as a supplement to Medicare and for nursing home care .

So what would my 40 something children expect when they retire? The Congressional Budget Office (CBO) could not estimate by how much co-pays would rise because Ryan's newest plan lacks details; his first plan tripled co-pays from the current 25% to 68% because costs would rise faster than funding. AARP also warns of higher co-pays .

By repealing Obamacare, Ryan throws out cost savings measures imposed on providers. He claims competition within exchanges that provide the private plans would be enough to lower costs, but this is no free market. It regulates prices of the participating insurers, limiting competition.

And the deficit? Per the CBO, the Ryan budget plan would increase it and keeping Obamacare would reduce it. For neutral information sources, see www.kaiserhealthnews.org , http://money.cnn.com/2012/04/23/news/economy/, www.factcheck.org, and www.politifact.com

 

How Obama could win the economy argument

My column in the Sky News today:

Is Mitt Romney a sheep in wolf's clothing or putting on an act that he is wolf in sheep's clothing?

Is he looking like a serious conservative or will he govern as an extreme conservative in spite of his supposed inner moderate self? Or is he like a Navajo shape-shifter, taking on the animal form that gets him the most visibility?

Now that the primaries are over, he will have to look more sheep-like to appeal to the swing voter moderates.

Obama's positions on women's rights and a kinder approach to immigration issues have helped his poll numbers. However, he is tied with Romney on the economy. He needs to do more.

A case Obama has not yet made: We do not need to trade away fair social policies for bad economic policies proposed by the GOP. He has a better, fairer plan for both. To make such a case, Obama does not need to be a shape shifter because he is consistent with his past policy priorities, but he also must attack Romney's plans more effectively than he has.

There are those who believe Romney had been appearing as a wolf on social and economic issues to get the support of his party's far right, but he is really a sheep inside that would govern as a moderate once he got elected. Obama can make the point they are fooling themselves. The pressure on Romney from the ultra conservatives dominating the GOP and Congress would make a second term improbable if he flip-flops on tax, health care, immigration and women's issues.

Romney‘s way out of this schizophrenic dilemma to appeal to moderates has been to make the conversation only about the economy, while hoping they forget the bargain he made to with the GOP right wing to support them on social issues. Simultaneously he claims his plan to decrease taxes on the rich and to increase military spending while slashing and burning discretionary programs that benefit the middle class, will be the better route to economic prosperity.

The route Romney has irrevocably tied himself to is the closest version of a European austerity program that exists in the US: the Ryan budget. Even the Catholic bishops opined that the Ryan budget "fails to meet the moral criteria" (to protect the poor) because it takes money away from the safety net. One phrase will come back to haunt him: He called that plan “marvelous” because it would reduce the deficit and create jobs.

This last weekend Obama began to make that case that his plans for the economy would better for America in the future although we may not have climbed out of the economic hole left by the GOP as quickly as we want. So far Obama has relied on reminding us that Romney's sole reliance on budget cuts /pump up the rich plan was a throwback to the policies that never dug us out of the holes in the past, so how could it be better?

That argument is not strong enough: Obama needs to take his attacks to the another level, arguing Romney's plan could even make the economy and debt worse, linking GOP plans to the extreme approach in Europe that led to the rejection of austerity by voters this past week in France and the experience of austerity in the United Kingdom. Obama could now argue that too much reliance on austerity there has led to stagnant growth or a double dip recession, job loss, and higher debt. Those are exactly the opposite results for which the GOP hopes and the Democrats have achieved in part.

The president's moderate, middle way, combining budget cuts, fiscal, tax, and income stimulants, has resulted in GDP growth, steady private sector job creation, and unemployment decreasing significantly. His balanced approach, similar to the Simpson Bowles recommendations, will also improve the debt situation.

Hope vs Back to the future; what would it have been like if the GOP won in 2008

My Column in the Sky Hi News on line edition today: The GOP presidential contenders are putting their eggs in one basket: The voters are feeling so much pain, anyone would be better than Obama. Oh?

Some in the GOP seem to yearn to return to the time of John Adams, when Abigail could run the farm and cash flow was only a nagging problem because she could raise their own food, sew her own clothes, and pay the doc in chickens.

That bucolic life is long gone thanks to the industrial revolution, the intertwined world economy, urbanization, an economy driven by middle income consumer spending, and expensive life-saving medical technology. “Each to his own and each on his own” has moral and economic implications. To what extent should we be our brothers' keeper? Is it good for the economy to leave one half of Americans near or in hopeless poverty?

To compensate for tax cuts, ground wars, and stagnant income, we plunged ourselves into deeper government and personal debt. Starry eyed, we put our money in unregulated investments based on questionable mortgage loans until the economy imploded in 2008.

When I hear voters wistfully say they just want it like it was before, for which “before” are they yearning? — the latter 1700s or the bubble of the early 2000s?. Most of the GOP's roadmap to prosperity is the bubble model that replicates their previous route that led to prosperity for the few, a col de sac for many, and eventual disaster for all.

Low taxes and less regulation did not lift the boats of the middle class much from 2001-2007, while the upper incomes soared, per the Congressional Budget Office. Job loss and recession began nearly the year before the crash of fall 2008. The theory that wealth trickles down to the middle class did not work well in practice.

The GOP is not about applying balm to middle income pains. They want to repeal help for Elm Street to aid Wall Street and Fifth Avenue, with more tax breaks to an already robust financial sector and the comfortable rich, repealing health care and Wall Street reform, and weakening consumer protection.

We can imagine a GOP future by going back to their past.  What would it have been like with a Republican or a Mitt Romney controlling Washington for the last three years instead of having the reforms and policies Obama supported and instituted? The financial sector would still be free to hoodwink investors and homebuyers, one bank failure could still bring down other banks, and we would still drown in the cost of more or indefinite ground wars. There would have been no pressure on banks to refinance responsible homeowners, and the housing market would be seeking an even deeper bottom. Detroit would have gone bankrupt; 1.4 million jobs would have evaporated as the industry would have moved abroad. The 2009 stimulus would not have been passed and another 2.3 million jobs would have been added to the unemployment count.

The Ryan plan would have passed so future seniors would pay $6,000 more a year for Medicare. 30 million citizens  could never hope to afford health insurance. Sending kids to college would have become a fading dream, with shrinking access to student loans, and continued unrealistic burden of paying back them back.

Simpson Bowles debt reduction plan would have been completely ignored because it recommended GOP no-no's   of reducing military spending, continuing cost saving Obamacare, and raising taxes on the rich, the very recommendations embraced by Obama.

In his State of the Union address, Obama gave us a new vision of “hope,” a fair shake for the future for the middle income. With all economic indicators zigzagging upward, he can rightfully claim he has indeed turned around the economy, if not yet cured it, and that a Republican future would be a leap back to the policies from whose consequences we are now trying to escape. 

Weak leader? Obama showed 'em

My column appearing in the Sky Hi News today...all editions

Be careful what you wish.  For the past year, the GOP has criticized President Obama for weak leadership and they have stonewalled every attempt he has made to be the adult in the room. They have dared him to take stands on deficit reduction and job creation, hoping his proposals would be unpopular.  They openly wished he would fail and they tried to strategize every way they could to fulfill their prophesy. 

Obama finally took their bait to take leadership after it became clearer where the center and the left had registered their preferences as reflected in the polls. In the past two weeks he grabbed the GOP hook, providing both long- and short-term proposals, ran away with it, and kicked off a substantive tug of war between a Republican Party captured by Tea Party fanatics and his base to see who could reel in the independents in 2012.

It is no more Mr. Nice guy.  While the president challenged the GOP to come up with short-term job-creating solutions, he provided his plan and drew his line in the sand.  Republican House Speaker John Boehner immediately dismissed Obama's job plan as gimmicks.  He took tax cuts off the table in advance, and dared the president to present his proposals for long term debt reduction.  Monday, the president did just that providing long-term proposals, and he made it clear he would veto any GOP legislation that tried to reduce the deficit on the backs of entitlements without raising taxes on the rich and making their percentage paid equal to the middle class.

The GOP is now left to defend their proposals for job creation and deficit reduction that polls show are not where most of the voters are.  Republican proposals may warm the heart of their base, but they need more than the affection of the Tea Party to win in 2012.

The GOP has banked its success over the past year on making deficit reduction a priority.  Polls show that voters overwhelmingly place job creation over deficit reduction because that is where their pain is felt and the reason consumer and industrial production demand is lacking. The GOP has gamely tried to tie job creation exclusively to long term deficit reduction plans based solely on cutting federal services and keeping taxes on the rich low. No expert mainstream, independent numbers cruncher believes that is possible.

The GOP claims tax increases are job killers. It isn't necessarily so, as one Democratic spokesperson pointed out Monday morning.  Both Reagan and Clinton increased taxes, and employment figures improved; when Bush cut taxes to the rich, jobs were lost. The burden on the GOP will be to convince voters that tax cuts to the rich will trickle down to create jobs in the short term, not some time in the distant future, if ever.

Both House Republicans and GOP candidates have dug themselves into an unpopular hole by proposing deficit reductions that would cut popular programs such as Medicare, either by raising eligibility ages or requiring future seniors to pay in $6,000 more per year, claiming Social Security was a fraud or unconstitutional, or requiring seniors to risk their Social Security in Wall Street investments.

Letting states fund entitlements is another proposal that is pretty hard to swallow. Many financially strapped states cannot even pay for teachers' and firefighters' salaries.

The president on the other hand Monday left Social Security alone, but he proposed alternatives to Medicare that would leave benefits to seniors unchanged by using other cost cutting measures. He still needs to detail a plan to keep Social Security solvent and he promised he would handle it separately since it is not a deficit related issue at this time. We can bet his solution will not be to privatize it or to palm it off to the states.

One thing the GOP cannot claim any more is that Obama is a weak leader. He showed ‘em.

For more commentary, go to http://www.mufticforum.com/

Did Boehner commit a boner?

Glory be. The President’s got guts. America awoke after the Bin Laden killing to a new appreciation of his cool, decisive, risk taking leadership style and a rug had been yanked out from under a key GOP strategy…to paint the President as a likeable, indecisive, professorial  wimp.  Immediately, Republicans fell back on their remaining ace in the hole…the economy.  They are not stupid.  They looked at the poll numbers and America grumbling about high gas prices and an anemic recovery.

 John Boehner, Speaker of the House, kicked off their strategy of renewed focus on economy at an economics forum May 10. Will he have committed a boner?

The Boehner address reminded me of that old camp sing song: “same song, second verse; could get better but it’s gonna get worse”.  He renewed holding hostage raising the debt ceiling to terms that were mostly more of the same as yore, , only adding zeros to some figures and adding twists that others had long ago dissed .

The prior GOP hostage deal  had been they would lift the debt ceiling only if the President would present a “serious debt reduction plan”.  The President proposed one, but the Republicans s either  acted as if it never happened or  dismissed  it as “gimmicks and deflections”.  Those are certainly ways  to avoid a side by side comparison of plans. Perhaps they feared whatever they proposed to date would not survive such scrutiny.

 Republicans probably hoped you would not remember that the Obama proposal would reduce the deficit by nearly the same as the plan House Republicans just approved , without destroying Medicare as we know it .  The key provision of the Obama plan, a trigger to force Congress to reduce the deficit by 2014 , was simply blown off by Boehner as , oops, it did not rule out tax hikes and we needed  to be specific about cuts now.

 Now Boehner raised the hostage terms from cutting billions to cutting trillions, but the rest looks just like before…with a twist or two.  Read Boehner’s lips, too, “no new taxes”.  Only cuts are acceptable. This is in spite of Obama’s plan proposing three dollars in cuts for every one dollar in tax hikes. The Simpson-Bowles debt commission and the gang of six in the Senate, including some heavy weight Republicans, came to the conclusion we could not reduce the deficit significantly without some tax increases. Even expert arm’s length observers writing in London’s Financial Times and on TV opined  relying only on cuts was political fantasy. 

Still on the table is the Ryan plan, in spite of some Republicans and the Tea Party running away from the proposal they voted for which would  substitute guaranteed Medicare benefits with vouchers that  contain no guarantees it would keep up with escalating costs. The GOP  still  proposes  to kill “Obamacare”,   thus eliminating  health care  cost containment provisions of the law,  removing the $400 billion it saves to the Medicare system , and restoring the  donut hole in drug benefits charged to seniors.  

However, Boehner did try to sidestep  the Ryan proposal by saying that everything is on the table except tax increases. What was new on the table was also warmed over dinner:  revival of the old GOP proposal to cut Medicare benefits to the wealthy.  This is no more than a riff on the old GOP song proposing of means testing to determine who would be able to receive benefits .

A boner Boehner may have committed is his  insistence on Republicans  being specific about what cuts they intend to make.   There are plenty of oxen that could get  gored, providing  ripe targets for Democrats to make poster children of GOP  heartlessness.

 Another boner  is that the hostage he insists  holding, raising the deficit ceiling, is one they dare not kill off because it would wreck the economy.  Most Republicans know it and do not care to have it haunt them in 2012.

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Republican strategy: ignore Obama's serious debt reduction proposal

Have you noticed? GOP's mantra is: we will not approve debt ceiling increase unless it is tied to a serious proposal to reduce the deficit. I thought Obama offered one: very serious and as effective, fairer, and less draconian, with a fail safe plan.  GOP's strategy: ignore it; avoid comparisons between the two. The Democrats have not helped because instead of emphasizing the debt reduction effectiveness (the seriousness of the Obama plan), they have seized on the privatization of medicare and unfairness issues. Those are legitimate and ultimately succeeding strategies, but they only dwell on the negatives of the Republican (Ryan plan). They also need to add a third point to their talking points...the Obama plan is a serious one.

 Most Americans do believe that the debt is a problem, and the Democrats would also be wise to emphasize the positives of how their plan would be more successful in the long term...or at least, be  either just as successful...and to make a firm point that the President's plan meets the criteria for a serious and effective  plan without the pitfalls of the GOP plan.

Of course, the stumbling block is the linkage: should the debt ceiling be linked to a serious plan as a condition of approval. The Democrats need to agree to a link, but the serious plan with which  it is linked to is more like the Obama plan and then they make a case for its superiority. What the Democrats ought not to do is to draw a line in the sand, but to indicate willingness to compromise a little and then they can paint the GOP is being stubborn,
ideologically based blockheads unconcerned with the collateral damage their plan incurs.

What will be fascinating is whether any compromise can be reached by the Gang of 6 in the Senate. We can expect the House GOP to continue to act like blockheads and stonewallers, but the ultimate test will be in the Senate where the Democrats hold the majority, yet members of their own party, including Colorado's Senator Udall agree that any debt ceiling increase approval must be tied to a debt reduction plan

On the Sunday talk shows on CNN, especially the one moderated by Candy Crowley, the GOP talkers tried to shift the conversation to: we must do it in the 2012 budget....upping the ante from a focus on the intermediate and long term realities of the federal deficit to doing a it all in the budget...a short term issue...  and then up the ante further by advocating for a balanced budget amendment (a short term political non starter) .Voters are going to have to become aware  of the long term solutions of deficit reduction vs. the practicality of an annual budget doing the entire  job now  and I think it is very easy for the GOP to obfuscate the entire debate as they confuse the two in the minds of the public. 

The danger of extreme 2012 budget reductions lies in the timing: severe cuts could stunt the recovery which is still a feeble one.  Like the UK, the danger lies in impact on the gross domestic product which in the UK's austerity program is now negative with  an increase in unemployment creating a strain on unemployment compensation funds.  A gradual move to austerity, as reflected in the Obama plan, may avoid the UK experience and the GOP's more abrupt one could actually harm the economy. Timing is everything. The Democrats could also make that point in the upcoming debate, especially since so much focus on the UK economy was the result of  media coverage of the royal wedding.