From The Needy To The Greedy: NV GOP Reps. Support Ryan Plan

On March 29, 2012 the House of Representatives voted 228 to 191 on H. Con. Res. 112 “Establishing the budget for the United States Government for fiscal year 2013 and setting forth appropriate budgetary levels for fiscal years 2014 through 2022.”  That would be the Ryan Budget, and both Representative Mark Amodei (R-NV2) and Representative Joe Heck (R-NV3) voted with the Republican majority.  [roll call 151]

To the Greedy. Since the numbers don’t add up in the Ryan/Romney budget plan, the entire scheme depends upon the support of those who believe in Tax Cuts for the Rich, and austerity for the remaining 99%.   For those who would like an illustration of precisely what Amodei, Heck, Romney, and Ryan are proposing there’s a chart for that:

So, if you are a median income earner in Nevada ($53,082) under the Ryan/Amodei/Heck/Romney proposal you could reasonably expect a 1.9% after tax income gain.  This might be a good time to note that the annual inflation rate for 2011 was 3.2%.  [USinflat] However, if you are earning more than a cool million, then your after tax income gain should be about 12.5% under the GOP plan.

The Tax Policy Center (Urban Institute & Brookings Institution) ran the numbers and concluded that the Republican plan takes care of the Greedy very well, thank you very much.

The Christian Science Monitor concluded:

“TPC looked only at the tax reductions in Ryan’s plan, which also included offsetting–but unidentified–cuts in tax credits, exclusions, and deductions. TPC found that in 2015, relative to today’s tax system, those making $1 million or more would enjoy an average tax cut of $265,000 and see their after-tax income increase by 12.5 percent. By contrast, half of those making between $20,000 and $30,000 would get no tax cut at all. On average, people in that income group would get a tax reduction of $129. Ryan would raise their after-tax income by 0.5 percent.”

But, but, but… sputters the GOP talking point, “46% of the people don’t pay any income tax.”  Curious, the Republicans are publicizing the fact that a significant portion of American income earners aren’t making enough money every year to be considered liable for federal income taxation.   What the 99% do pay are payroll taxes — which they pay in higher proportions than the 1%’ers, and sales taxes — which are the most regressive form of taxation imaginable.  In short the GOP budget, which Representatives Heck and Amodei were pleased to support attends solely to the tax concerns of the economic elite.

From the Needy.  So, how do the Republicans intend to “reduce the deficit” by practicing austerity on the remaining 99% of the U.S. population?  Here’s part of the problem:

“Because Romney promises to protect current Social Security and Medicare recipients from cuts, he cannot get much savings from those programs by 2016. Combined, they are projected to make up about 44 percent of the budget that year. Interest costs, which cannot be touched, would make up an additional 9 percent of the budget, while Romney promises to add almost $100 billion to the Pentagon budget that year, based on his pledge that military spending reach 4 percent of GDP.”  [full article Salon Taylor]

So, what remains on the chopping block?  Ans: Programs designed and implemented to assist low and moderate income Americans, those same median income earners who aren’t going to see after tax income gains that are likely to exceed the rate of inflation.

Medicaid:  As of 2009 there were a total of 62,458,000 Medicaid recipients in this country. 5,433,000 of the recipients were in general hospitals, another 115,000 were receiving care in mental hospitals.  101,000 were mentally disabled.  1,644,000 were in nursing homes.  [SSA stats]    The simplistic “Gee Whiz” formula for reducing expenditures relies on assuming a reduction in the number of recipients and/or reducing the funding available for the program.

This is where the ideology is at variance with the reality:

“The rate of increase in Medicaid expenditures also declined over the last decade. A major contributor to Medicaid expenditure growth has been increases in enrollment caused by the two economic recessions experienced in the past decade and continued growth, almost 3 percent per year, in the disabled population. Medicaid spending growth on a per enrollee basis in the past decade was below 3 percent per year. Part of this relatively low growth rate is due to the changing composition of Medicaid enrollees— the number of lower cost adults and children grew faster than the aged and disabled. But states have also been very aggressive in cost containment efforts because they face declining revenues and have many competing priorities.”  [UrbanInst. pdf]

After the Little Wizards of Wall Street (aka Financialists) lost approximately $10.2 trillion in our national wealth in the wake of their Housing Bubble and CDO Bonanza circa 2008, [BusInsider] we’d expect to see a rising number of individuals eligible for Medicaid.   And, while the states were struggling to cope with the consequent declining revenues they were also trying to assist a growing number of “low cost” adults and children.   Perhaps a little sparkly anti-deficit dust sprinkled over the spreadsheets would work a bit of magic? Like Block Grants?

What if Medicaid funding came in the form of block grants to states?  Then the states could be “creative and flexible.”  Yes, and they could also look forward to being creative and flexible with continually declining revenues.

Ask local officials who deal with HUD block grants how “creative and flexible” they are being as they look at 12% cuts, and a Congress which shaved about $390 million from their revenues?  [Governing] A local official in Connecticut summed up the situation:

“CDBGs, Rodriguez said, have been under constant threat of federal budget cuts. He said at one point former President George W. Bush ’68 called for an end to the entire program until he faced overwhelming resistance from cities.

“The Block Grants is one of those grants that we always worry about because the federal government is always cutting it,” Rodriguez said. “It may actually go away, depending on what happens to Congress [in the 2012 elections].” [YaleDN]

The simplest way to think of the GOP proposal for health care services for the poorest among us is to note that of all the formats for federal funding the block grant is the easiest  to cut.

From what other sources might the Romney and his Republican cohorts make budget cuts in order to finance the extension of the Bush Tax Cuts for the top 1% and other tax breaks?

Former Governor Romney has “promised” 5% cuts in non-defense budget categories, so what would that include?  “At issue are these programs, just to name a few: health research; NASA; transportation; homeland security; education; food inspection; housing and heating subsidies for the poor; food aid for pregnant women; the FBI; grants to local governments; national parks; and veterans’ health care.” [Salon]

Somehow the “Support the Troops” Republicans managed to draft a budget proposal for the consideration of the House of Representatives without using the word: Veteran.   So, when we have about 45,000 members of our military services coping with wounds and injuries sustained in Iraq and Afghanistan, we have a Republican Party suggesting a cut of $11 billion from veterans care programs.  [VV] As Andrew Taylor opines in his Salon article, if the Romney campaign and other Republicans eschew cuts to VA programs, then the remaining federal functions would face deeper cuts.

Public Health and Safety.   Food – the amount of  regulated goods have increased by 200% in the last decade, but as of today we only inspect about 2% of food imports.  We import about 80% of our seafood from China and Thailand, countries with less stringent food safety laws that our own.   And now the GOP proposes to cut from 5% to 20% of the food inspection budget?  [News21] As one commenter put it, “You can’t fight bioterrorism with a tank.”  [The Hill]

Police and law enforcement – Senator Harkin was justifiably disappointed to note that the Republican version of a budget cut $118 million from federal funds to support local and state law enforcement. [Harkin] In FY 2011 the BJA processed 56 state and 1,348 law enforcement funding applications, and in FY 2012 made $295.58 million available to local and state officials for improvements in policing, and for other programs like the sex-offender registry and the Adam Walsh Child Protection and Safety Act. [BJA pdf]    However, in the interest of the 1% the GOP is willing to cut from 5% to 20% from the BJA programs which, “…. provides  states, tribes, and local governments with critical funding necessary to support a range of program areas including law enforcement, prosecution and court, prevention and education, corrections and community corrections, drug treatment and enforcement, planning, evaluation, and technology improvement, and crime victim and witness initiatives.” [BJA pdf]

Perhaps the most cynical, and assuredly the most economically irrational, of the GOP cuts would be to programs like food stamps (SNAP) and WIC.   Chad Stone explains:

“The $8 billion in SNAP cuts over the next year would do more damage to economic growth and job creation than any stimulus that the $46 billion in tax cuts could generate, according to standard “multiplier” or “bang-for-the-buck” estimates like those from the Congressional Budget Office (CBO) and Moody’s Analytics.

CBO ranks policies like SNAP and unemployment insurance (UI) as among the most effective ways to boost economic growth and job creation in a weak economy — and business tax cuts like those in the House bill as among the least effective.  That’s because SNAP and UI benefits go to low-income and struggling Americans who will spend virtually every additional dollar they get to pay bills and buy necessities, while the main problem businesses face is that too few customers are spending too little money — and that won’t be fixed by giving the businesses themselves a tax cut. “

Especially not effective if the tax cuts are designed to benefit those “small” businesses like hedge funds and lobby shops that are already doing well and yielding income to their owners and partners sufficient to put them in the +$1 million annual salary category.  Exactly how the House GOP explains a $46 billion reduction in the SNAP program as a “job creator” requires more imagination and intellectual gymnastics than a Cirque Du Soliel production.

But, never fear — protecting the tax breaks for millionaires and billionaires is, by Republican lights, ever so much more important that preserving Medicare as we know it, or preserving the health care services for the elderly, the children, or the disabled in poverty, or sustaining programs for Veterans, or enhancing public safety by supporting our local sheriffs, or making sure our food imports are inspected, or insuring our bridges are safe…

The Republican focus, as adopted by Rep. Ryan, and supported by Representatives Heck, Amodei, and by presidential candidate Romney is singularly narrow, and illustrates with astounding clarity how eager they are to sacrifice the needy for the noteworthy benefit of the greedy.

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Filed under 2012 election, Amodei, Berkley, Federal budget, Food Safety, Health Care, Heck, income tax, Medicaid, Nevada Congressional Representatives, Republicans, Romney, Veterans

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