The Obama Diary

Clay Bennett

St Louis Post-Dispatch: … Paul Ryan’s plan offers a big bouquet to wealthy Americans, cutting their tax rates from 35 percent to 25 percent; eliminating the estate tax and taxes on capital gains and dividends. The richest 1 percent, who already take in nearly a quarter of American income and control almost 40 percent of all forms of wealth, would see their taxes cut in half. The average tax cut for millionaires would be about $500,000 a year.

The burden of the Ryan plan would be born by the shrinking middle class, which would lose its single biggest tax break, the deduction for home mortgages; and the elderly, who would see their Medicare health coverage effectively eliminated. Medicare for those already age 55 or older would be left alone (for political reasons) but younger Americans, as they become eligible, would get vouchers to purchase care on insurance exchanges …He would turn Medicaid, which pays for medical care for the poor, into a block grant program, letting states spend it as they wish.

Mr. Ryan’s bill is a potpourri of crackpot Republican ideas - a “business consumption tax” that is effectively a value-added (sales) tax that falls most heavily on the poor and middle class; the discredited trickle-down nonsense of Reaganomics; “flat” (or at least flat-ish) tax rates and the shredding of the social services safety net. Defense spending would not be cut. Spending on veterans’ health care would be.

….Clearly spending must be cut. But it must be done fairly, in combination with new revenue generated from those who can afford it, and without imposing heavier burdens on those at the bottom of the economic ladder.

…House GOP negotiators are held hostage by 87 freshmen zealots; the White House is holding out for short-term fixes in the probably vain hope that adults will gather and talk seriously about the long term.

The government may have to grind to a halt before that can happen. That, and public outrage over the Ryan plan, may play right into Mr. Obama’s hands.

Full article here

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There’s another great post here on Ryan’s plan by PM Carpenter (Thank you Ladyhawke)