entitlement reform

The President's Budget Is No Move Toward the Center

Over at the US News Debate Club blog I have a post arguing that the administration’s 2014 budget proposal is not the compromise that the president and his supporters are trying to sell it as.

To sum it up, the president's 2014 budget would result in massive tax and debt increases over the next decade, with no serious entitlement reform. The ten-year tax hike is $1 trillion, on top of the $0.6 trillion enacted in January and $1 trillion in Obamacare. But even with massive new taxes, the debt would still rise to $19 trillion in 2023, up from $5.8 trillion at the end of 2008. That's not the basis for striking any kind of deal with the GOP.

Read the rest of the post (and don’t forget to up-vote it!) here.

posted by James C. Capretta | 12:40 pm
Tags: 2014 budget, entitlement reform
File As: Politics, U.S.

Saving Seniors and Our Most Vulnerable Citizens from an Entitlement Crisis

Earlier this week I was invited to give testimony before a House Energy and Commerce Health Subcommittee hearing on “Saving Seniors and Our Most Vulnerable Citizens from an Entitlement Crisis.” A video of the entire hearing is available here (with my testimony beginning around at around 20:30), and you can read my written statement here.

posted by James C. Capretta | 12:30 pm
Tags: medicare, entitlement reform
File As: Health Care

The Urgent Need for Genuine Health and Entitlement Reform

The editors of economics21.org recently invited Charles Blahous, David Malpass, and me to provide some commentary on the state of fiscal and monetary policy as President Obama begins his second term. In my contribution to the collaborative article, I make the case for market-friendly reforms to American health care entitlement programs.

At the heart of the nation’s fiscal challenges are the rising costs of the major health care entitlement programs -- Medicare, Medicaid, and the new subsidies provided by the 2010 health care law. In 1972, total federal spending on Medicare and Medicaid was just 1.1 percent of GDP. By 2010, the costs of these programs had risen to 5.5 percent of GDP, and CBO projections from last year show the costs rising to 9.1 percent in 2030 when the new entitlement spending from Obamacare is also added in and when plausible assumptions about on-going enforcement of arbitrary cost-cutting measures are used.

The prospects for seriously addressing the problem of health entitlement spending is not promising in the president's second term in large part because there is a sense in his administration and among congressional Democrats that Obamacare has already largely solved the problem. They argue that the provisions cutting future Medicare spending in the new law will work, and that numerous, government-initiated efforts to cut costs (such as the Accountable Care Organization program in Medicare) will fundamentally transform how health care is delivered in the United States.

You can read the rest of my piece, along with the contributions of David Malpass and Charles Blahous here.

posted by James C. Capretta | 12:09 pm
Tags: entitlement reform
File As: Health Care

The Budget Battles Ahead

Over at National Review Online I have a column on how conservatives should approach the debate over entitlements and taxes in the aftermath of the fiscal-cliff resolution.

The main criticism, and an accurate one, of the fiscal-cliff agreement is that it secured a tax hike for the president that was not paired with any spending restraint whatsoever. The bill includes spending increases (an extension of unemployment compensation and another one-year undoing of the scheduled cut in Medicare physician fees), but not nearly enough cuts to offset them. Nothing has been done to address the real problem in the nation’s finances: the ballooning costs of entitlement programs.

Some conservatives have taken heart in the fact that the agreement did not raise the debt limit, setting the stage for a more successful budgetary confrontation in another 60 days or so, when federal borrowing is expected to bump up against the current statutory ceiling. The argument is that raising the debt limit is so unpopular with the public that Republicans will have substantial leverage to extract meaningful spending cuts from the president. Unfortunately, this is more wishful thinking than a sound assessment of the political landscape.

Read the rest of the article here.

posted by James C. Capretta | 11:36 am
Tags: fiscal cliff, taxes, entitlement reform
File As: Politics, U.S.

Super Committee, Super Confusion

The "super committee" looks poised for failure — which is a much better outcome than some of the deals that were being floated in the last few weeks. As I wrote on NRO last week:

Recent news stories have suggested that the GOP members have offered to raise taxes by $300 billion over the coming decade as part of a deal that would also include some reductions in entitlement spending. But once again, the entitlement changes will do nothing to change the basic, cost-inflating structures of Medicare, Medicaid, or Obamacare. Indeed, if the GOP were to strike such a deal, it would make it that much harder to do what really needs to be done, which is to replace the entire health-entitlement status quo with reformed programs that rely on cost-conscious consumers in a functioning marketplace.

Moreover, the deal that is apparently under consideration would also rely on Senate Finance Committee chairman Max Baucus to write the actual tax and entitlement legislation, along with his GOP counterpart in the House, Dave Camp. This is hardly a process that builds confidence, as Baucus was a primary architect of the massive government overreach that is Obamacare. Indeed, if the supercommittee’s contribution to deficit cutting is to cede power back to the regular committee process, one has to wonder, what was the point of having the committee at all?

You can read the whole piece here.

posted by James C. Capretta | 11:14 am
Tags: super committee, taxation, entitlement reform

No Entitlement Reform in the Presidentís New Proposal

I have a new column up at e21 on the president’s latest budget proposal:

This plan wasn’t aimed at building bridges to the GOP or helping the Joint Committee come to an agreement. It was aimed at drawing sharp contrasts between the parties and positioning the president going into the 2012 presidential campaign. In that regard, it seems to have worked. The already very wide partisan divide now prevalent in Congress only widened further in the last week. In this highly charged environment, the odds that the Joint Committee will come to a grand tax-entitlement bargain are exceedingly low.

But perhaps that is just as well. Because it is also quite clear from the president’s latest health care proposals that serious entitlement reforms — the kind that would actually make a difference and would be worth striking a “grand bargain” to achieve — aren’t in the cards before the November 2012 election....

You can read the column in full here.

posted by James C. Capretta | 12:31 pm
Tags: entitlement reform, Joint Committee
File As: Health Care

Why the Obama Health Plan Is Not Entitlement Reform

On July 15, the Galen Institute held an event on Capitol Hill at which I had the privilege to discuss a paper I have written on why the Obama health plan is not entitlement reform. The event was moderated by Grace-Marie Turner, the president of the Galen Institute, and opening remarks were graciously provided by House Budget Committee Ranking Member Paul Ryan. Gene Steuerle, of the Urban Institute, and Doug Holtz-Eakin, the former Director of the Congressional Budget Office and now president of the American Action Forum, provided additional comments on the paper as well as other important insights on where we should go from here. The entire event is available for viewing here.

Update: NRO has also published a short op-ed that I wrote summarizing the main points of the paper. It is available here.

posted by James C. Capretta | 1:48 pm
Tags: Grace-Marie Turner, entitlement reform, Urban Institute, Paul Ryan