Paul Ryan's Shocking Budget Proposal

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Rep. Paul Ryan's new budget proposal -- which essentially privatizes Social Security and strangles Medicare inflation with cost-controlled vouchers -- is a really important lesson in budgeting. It's very easy to fix our long-term deficit crisis. All you have to do is blow up our entitlement program.

There's a bit of a debate about whether Ryan's proposal is so honest it's crazy, or so crazy it's not serious. I think it's extremely serious -- not as a budget proposal, but as a dystopian parable. It's like reading 1984 for the next century, but with graphs.


Consider the terrifying Medicare proposal. Ryan would give seniors a voucher equal to average Medicare spending per enrollee. Over the next decade, the buying power of the voucher would grow more slowly than medical spending, but at the same time, the cost of premiums will increase because seniors would wander into the more expensive private market for insurance. Anybody wanna know what rationing look like?

Fiscal hawks like talking about "tightening belts." This goes way beyond tightening by a few belt holes. This plan is more like taking off your belt and tying yourself to a treadmill that has no off-switch. It's an effective weight loss plan, indeed, but good luck convincing the neighbors to sign up for prepaid 12-month plan.

Truly, I think it's a shocking budget, and the kind of thing that no party in power would ever have the cojones to propose. Indeed, Republicans didn't even have the cojones to co-sign health care reform's Medicare cuts. Six months after the Democrats' proposed Medicare savings made Republicans shout bloody murder (literally: Death Panels), Rep. Paul Ryan is now proposing the program's gradual extermination. Like any good dystopian parable, this doesn't deserve to be taken literally. It's about the lesson: Our deficit crisis in an entitlement crisis, and the solution won't be pretty.

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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