Monday, May 02, 2005

Financial Ruin: It's Automatic

Picture credit: Elder Law St. Louis
Excel web sharing - spreadsheet collaboration over the Internet made easy with BadBlueTime Magazine's Blog of the Year continues its run of outstanding commentary. John Hinderaker posts the following ominous missive on the failure of either party to get serious about addressing out-of-control entitlement spending.

And, yes, the MSM/DNC is worse -- much worse -- than the GOP because they fail to even acknowledge the problem. It used to be that both parties would step up to challenges together to confront true threats to the United States.

But the Democratic leadership is no longer acting in the best interest of Americans. They are, instead, on a course of obstructionism for obstructionism's sake. And that spells the continued, catastrophic meltdown of the Democratic party. Read on:

Entitlements are devouring the federal budget and, if they are not checked, will inevitably dictate higher taxes and a downward spiral of slow growth and unemployment. That's the way it looks to me, anyway. And no one is doing anything about it. The "cuts" proposed by the Republicans are so trivial as to be merely symbolic, as is the ritual faux-outrage expressed by the Democrats in response. Dafydd ab Hugh dissects the latest round of fake "cuts" and fake "outrage":

Those nasty, brutish, and short Republicans are once again trying to take the pills that Grandma needs right out of her mouth, according to the Associated Press. Here is the scareline of the AP article:

House Passes Budget That Cuts Medicaid

Oh, no -- cutting Medicaid! Granny will have to choose between antibiotics and bread! The first two paragraphs make clear the perfidy of the Republicans:

WASHINGTON (AP) - The House narrowly passed a $2.6 trillion budget Thursday evening that would cut back the Medicaid health care program for the poor for the first time since 1997 in a step toward trimming federal deficits.

The 214-211 vote approved a blueprint that instructs lawmakers to freeze or cut spending in many domestic programs outside defense and homeland security and restrain farm, student loan, pension and some other government programs that grow automatically from year to year....

So what are the specifics? How much will the dastardly Republicans slash from Granny’s health care?

The budget would shave automatically increasing benefit programs by $35 billion over five years while also cutting taxes by as much as $106 billion over the same period.

Medicaid, the federal-state health program for needy and disabled Americans, gets marked for the single biggest change, a $10 billion reduction over four years....

Wait a moment... the new budget plan would shave the “automatically increasing” program? What exactly does that mean? Here is the kicker:

Without any change, the Congressional Budget Office expects the government to spend $191 billion on Medicaid next year and more than $1.1 trillion over the five years covered by the budget.

In other words, we originally anticipated spending an average of more than $220 billion per year over the next five years... which is an average increase of nearly $30 billion per year (15%) over the 2006 budget; but under the Republican plan, this would be reduced by $10 billion over four years, or an average of $2.5 billion per year.

In other words, the “cuts” to Medicaid under the new budget would mean that instead of increasing the Medicaid budget by $30 billion per year -- we’ll only increase it by $27.5 billion per year!

To Nancy Pelosi, that’s a pay cut so staggering it amounts to “an assault on our values!”

Any truthful discussion of entitlement spending seems to be impossible. So the escalator just keeps on rising. It's automatic.

Powerline: Financial Ruin: It's Automatic

No comments: