An irrational plan

Thursday, April 7, 2011 | 2:01 a.m.

Republican Rep. Paul Ryan, chairman of the House Budget Committee, unveiled a budget plan Tuesday that he said would slash the national debt and put the country on a “path to prosperity.”

But Ryan’s plan, offered on behalf of the committee, would only lead to prosperity for the rich. It would be disastrous for the rest of America.

In the name of reining in the deficit, Ryan would make major changes to the nation’s social safety net that would be harmful to seniors in years to come.

In 2022, under Ryan’s plan, the government would make Medicare voluntary. People who are now age 55 or older would find benefits unchanged, but those who are younger would enter a much different system. They would have a choice from a list of private insurance plans, and the federal government would pay a subsidy toward their premiums.

The Republican talking point is that seniors would have the same options for health insurance as members of Congress. That sounds great — if you’re a member of Congress making $174,000 a year — but to a senior living on a fixed income, it’s terrible.

The Congressional Budget Office says the percentage paid by participants would nearly double by 2030, and that would undoubtedly leave many seniors with little to no insurance. And the plan would raise the eligibility age for Medicare to 67 from 65 — and that means people would have to work longer if they want health insurance.

As far as Medicaid, the program that provides health insurance for the poor, Ryan would shift funding and put the burden on the states. As it works now, the federal government matches state spending on the program but that would change. There would be federal block grants, meaning a cut in spending that would result in states either raising taxes or cutting benefits.

Ryan’s plan also talks about making significant “reforms” to Social Security. Although he doesn’t spell those out, he talks of reducing benefits.

The plan doesn’t just target the social safety net. He also offers tax breaks for corporations and the rich, calling for lower tax rates for both. Meanwhile, the middle class and the poor would feel the brunt of his actions. An analysis by the Washington-based Citizens for Tax Justice reports that the bottom 80 percent of taxpayers would pay $1,700 more on average while the richest Americans would see a reduction of more than $200,000.

Underlying Ryan’s whole plan are faulty assumptions and unrealistic projections that are reminiscent of the Reagan-era “voodoo economics.” For example, it says unemployment will drop below 3 percent — something that no sane economist would even suggest, considering it hasn’t happened since the 1950s.

Yet Republicans are ridiculously holding up Ryan’s plan as proof that they are offering real “solutions” to help push America forward. These proposals do nothing to address the issues facing the country. They would harm the middle class and the poor, while helping the rich.

This plan goes to the heart of the stalemate in Congress in recent months: Republicans argue that they’ve done their part by offering — and stubbornly holding to — irrational plans and then blame the Democrats for nothing getting done.

This is insanity.