Last week Mr. Ryan ( the chairman of the House Budget Committee) unveiled his budget proposal...
And then Mr. Obama laid out a budget plan that really is serious.
The president’s proposal isn’t perfect, by a long shot. ... But the vision was right, and the numbers were far more credible than anything in the Ryan sales pitch...
There was also a difference in visions of how the world works. And nowhere was that clearer than in the issue of how Medicare should pay for drugs.
Mr. Obama declared, “We will cut spending on prescription drugs by using Medicare’s purchasing power to drive greater efficiency.” Meanwhile, Mr. Ryan held up the existing Medicare drug benefit — a program run through private insurance companies, under legislation that specifically prohibits Medicare from using its bargaining power — as an example of the efficiencies that could be gained from privatizing the whole system.
Mr. Obama has it right....The right way to assess Part D is by comparing it with programs where the government is allowed to use its purchasing power. And such comparisons suggest that if there’s any magic in privatization, it’s the magical way it makes drug companies richer and taxpayers poorer. For example, the Department of Veterans Affairs pays about 40 percent less for drugs than the private plans in Part D.
Did I mention that Medicare Advantage, which closely resembles the privatized system that Republicans want to impose on all seniors, currently costs taxpayers 12 percent more per recipient than traditional Medicare?
But back to the president’s speech. His plan isn’t about to become law; neither is Mr. Ryan’s. And given the hysterical Republican reaction, it doesn’t look likely that we’ll see negotiations trying to narrow the difference. That’s a good thing because Mr. Obama’s plan already relies more on spending cuts than it should, and moving it significantly in the G.O.P.’s direction would produce something unworkable and unacceptable.
What happened over the past two weeks, then, was more about staking out positions than about enacting policies. On one side you had a combination of mean-spiritedness and fantasy; on the other you had a reaffirmation of American compassion and community, coupled with fairly realistic numbers. Which would you choose?
Friday, April 15, 2011
The credibility of the President vs. the GOP's Budget Czar: "Who's Serious Now?"
From Paul Krugman's NYTimes column: