A Same-Old GOP Budget: Rich Pay Less, Everyone Else Pays More

At President Obama's White House summit on health care last month, when it was the House Republicans' turn to make an opening presentation, GOP leader John Boehner turned to Rep. Paul Ryan (R-Wis.), the top Republican on the House budget committee, to put forward the Republicans' case. Ryan, a sincere-sounding policy wonk, said nothing about insurance company abuses, nothing about expanding coverage and nothing about addressing the affordability of health insurance. Instead, he zeroed in on one matter: the deficit. He conceded that the Congressional Budget Office had concluded that the health care reform legislation backed by Obama would reduce the deficit by $131 billion over the next decade, but he contended that this was because the bill was loaded with "gimmicks and smoke-and-mirror." He proceeded to argue that the health care measure would actually lead to $460 billion in deficit expansion.

Ryan's presentation -- which contained its own gimmicks -- was a signal that the Republicans see him as their go-to guy on fiscal matters. So it's quite fair to view the radical budget plan he unveiled a few weeks ago as a mainstream GOP initiative. Under his proposal -- which Ryan calls "A Roadmap for America's Future" and promotes on a rather spiffy Web page with gee-whiz graphics -- Social Security would be rejiggered to include private accounts, and Medicare and Medicaid would be replaced with vouchers-based private systems. This would indeed be bold change, and some conservatives just adore Ryan for being so audacious and so in love with the power of markets. But there is a same-old Republican aspect to his plan: The rich would pay less taxes . . . and everyone else would pay more.

This week Citizens for Tax Justice, a Washington-based advocacy group that focuses on tax policy, released a report analyzing how Ryan's master plan would affect taxes for Americans -- and compared it to Obama's budget proposals. These number-crunchers found that the top 1 percent -- people who make $460,700 or more a year -- would get a tax break of 15 percent and on average pay $211,300 less than under the Obama plan. Everyone in the top 10 percent ($127,769 and above) would receive a break. Those in the bottom 80 percent ($88,658 and below) would pay more taxes -- on average $1700 more. People making less than $20,063 would have to dole out $1605 in extra taxes.


These are pretty stark numbers. One reason low- and middle-income families would get socked by Ryan's plan is that he proposes replacing the corporate income tax with an 8.5 percent "business consumption tax" -- essentially a sales tax. Citizens for Tax Justice explains:


Moreover, Ryan's plan, this group says, would lead to the government collecting $183 billion less revenue in 2011 and more than $2 trillion less over a decade:


Ryan's plan has received attention mostly for getting rid of Medicare and Medicaid and pushing Social Security toward privatization. But now there's another case against it: It will squeeze more tax dollars out of low- and middle-income Americans to ease the burden on the wealthy.

Democrats ought to have a political field day with Ryan's plan during the 2010 campaign. It shows what the Republicans would like to do if they regain power: cut taxes on the wealthy, boost them for everyone else, while replacing Medicare and Medicaid with vouchers that will not cover the same amount of health care. Free-market health care for the elderly and poor, more regressive taxation -- all this sounds like a road map to the past.

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Speaking of money, I tried to score $1,000 when I appeared on MSNBC with GOP consultant Brad Blakeman on Tuesday. We were discussing Karl Rove's book and Rove's contention that George W. Bush did not "lie us" into war -- an argument I blow apart here -- and Blakeman asserted that Bush started the war because Saddam Hussein had refused to allow international weapons inspectors into Iraq. I noted that this was absolutely not true. Weapons inspectors had returned to Iraq in the months prior to the invasion and had filed several reports noting there were no signs of any WMDs. But Blakeman insisted that the inspectors had not been allowed to conduct inspections inside Iraq. On air, I offered to bet him $1,000 on this. "Take the bet," I urged. You can see what happened below. MSNBC has invited us back to resolve this matter on Thursday morning.

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