Paul Ryan's Budget: The Atlantic's Official Guide

This week, Rep. Paul Ryan unveiled the most dramatic budget plan from a sitting representative in recent memory. His proposal would cut $6 trillion in spending over the next ten years, shrink the tax code and transform Medicare into a simple voucher program to slow the growth of health care costs. Here's a quick guide to the story and ongoing coverage from The Atlantic and National Journal.

What the Budget Does:

The budget cuts $6.2 trillion in spending over the next decade, reducing deficits by $4.4 trillion. Analysis from the Heritage Foundation projects the plan to create 1 million new private-sector jobs next year; bring unemployment down to 4 percent by 2015; and yield $1,000 per year in higher income for the typical family.

How It Works:

In the next ten years, most of the cuts come from repealing Obamacare ($1.4 trillion in savings), capping discretionary spending at 2008 levels ($920 billion), turning Medicaid into a block grant program ($730 billion) and finding an additional $1.8 trillion in mandatory cuts.

Starting in 2022, Ryan turns Medicare into a voucher program. Rather than pay seniors' medical needs on a service-by-service basis, we would mail a voucher equal to the amount that we're projected to pay for the typical Medicare recipient in 2022. Every year after 2022, the voucher's value would increase slower than the projected growth of health care spending. Thus, the government caps Medicare spending, which is the chief driver of our long-term debt.

Ryan would also reform the tax code so that both families and corporations would pay lower marginal rates but qualify for fewer exemptions. The plan is designed to be revenue neutral, but it could raise effective tax rates on the rich or the middle class, depending how it is structured. The plan is designed to hold tax revenue at its historical average of 19 percent.

Our First Takes

BUDGET IS POLICY-RICH, POLITICS-POOR: Paul Ryan deserves credit for a bold, comprehensive budget plan, but the devil is in the details, Clive Crook writes. Ryan's health care plan is supposed to replace Obamacare, but it "holds out no more hope of controlling costs than Obama."

RYAN EXPOSES THE DEMOCRATS: "What the Ryan plan really shows is not where we're going, but how long it's going to take us to get there," Megan McArdle writes. Democrats have to offer something substantive in response, but the GOP should come to grips with the fact that no plan will pass without some tax increases.

RYAN'S MATH: EVERY MINUS IS A PLUS : "Ryanism's DNA is the faith that removing government from the economy is addition by subtraction," writes Derek Thompson. Ryan relies on an arithmetic philosophy that all our nation's problems can be solved by asking Washington to spend less, but not every minus is a plus.

Deeper Cuts on...

BUDGET DEALS: If Republicans think they can get a budget deal without tax cuts, they're delusional. -- Megan McArdle

HEALTH CARE: Ryancare and Obamacare have more in common than you think. They're both designed to slowly strip away subsidies and gradually expose consumers to the true cost of health care -- Derek Thompson

HEALTH CARE: CBO: Private share of health care spending would nearly double by 2030. -- Chris Good

JOB GROWTH: The worst assumption in Ryan's budget: Job growth will double next year only if we fire hundreds of thousands of government workers today -- Derek Thompson

POLLING: Cutting Medicare is the least popular way to reduce the deficit, according to a recent public poll. -- Chris Good

TAXES: Ryan's plan cuts taxes for the rich to pay for ... fewer services for the poor? -- Garance Franke-Ruta.

From National Journal:

The Authoritative Breakdown of Ryan's Cuts -- Tim Fernholz

Ryan Cuts Medicare a Year After Republicans Defended It -- Alex Roarty
The Rosy Budget Projection's Rely on a Housing Boom That Seems Unlikely-- Jim Tankersley and Katy O'Donnell

INFOGRAPHIC: Where the Cuts Will Come From: Obama vs. Ryan -- Katy O'Donnell

Image: White House