Ryan plan is a road to ruin

By Amy Logsdon

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The top story in Monday's Gazette was about the dire consequences to Iowa's state and local budgets from the previous week's 2011 federal budget cut vote in Congress. We thank The Gazette for reporting on this sometimes-overlooked connection between the inside-the-beltway dialogue on the federal budget and our own Main Street Iowa plans and projects.

With the ink on the continuing resolution for the 2011 budget not even dry, Congress is now tasked with drafting the 2012 federal budget. We must pay attention and prevent even more catastrophic effects to our local economy as a result of the political grandstanding taking place in D.C. Many of us were distracted by the threatened shutdown of the federal government and may have missed the bigger budget battle brewing. The 2012 “Ryan Budget” passed the House Monday on a party-line vote and now heads to the Senate. Now is the time to call on our Iowa senators to do the sensible and responsible thing and oppose this proposal.

Congress is debating a budget proposal submitted by Rep. Paul Ryan, a Wisconsin Republican who proposes $2.2 trillion in spending cuts to Medicaid, Medicare and other health care services. Ryan describes his proposal as a “path to prosperity” for a country facing demographic changes and rising health care costs.

But this plan would be a path enjoyed by only the wealthiest Americans, who would see their income tax rates fall under his proposal. For the rest of us, Ryan's approach is a road to ruin.

What does Ryan's proposal mean for Iowa?

Medicare serves almost 514,000 Iowa seniors. Ryan wants to turn Medicare into a private insurance voucher program. It would force recipients to pay double and eventually triple what they now pay. The non-partisan Congressional Budget Office analysis of the Ryan proposal shows that by 2030, seniors will be left to pay almost 70 percent of their own health care costs, driving many seniors into bankruptcy.

Ryan's budget also eliminates the tax credit for lower- and middle-income families Congress approved in order to help people pay for health insurance under the Affordable Care Act. In the last few years, thousands of small businesses owners and families have lost their health care coverage because of skyrocketing costs. These tax credits would have put health insurance back into reach for these businesses and families. By cutting this tax credit, the Ryan budget will leave 220,000 more people in Iowa without health insurance by 2021, according to a report by Families USA, a nonpartisan group that represents health care consumers.

Under the Ryan budget, Iowa would lose $15 billion in federal funds and tax credits between the years of 2012 and 2021.

And as dismal as this sounds, the outlook actually is worse. Ryan's plan also would decimate Iowa's economy. As the Families USA report notes, reduced federal funding into the states would cost states jobs and hurt state and local economies. This is because the federal contribution to Iowa's Medicaid program is new money that flows into Iowa's economy.

There are alternatives to Ryan's budget, which gives $1.5 trillion in tax breaks to the rich and big corporations while rewarding the health insurance industry. Medicare and Medicaid could save money by negotiating prescription drugs prices, which would cut drug prices in half. They could pay hospitals to improve their communities' health, instead of rewarding hospitals that provide the most expensive care. And, of course, we could make corporations and the wealthiest Americans pay their fair share.

Tell our Senators that Congress needs to go back to the drawing board and come up with a plan that balances the budget and reduces the deficit sensibly and responsibly. The real solution is to pass a budget that creates jobs, educates our children, invests in our communities and provides for a secure, dignified retirement.

Amy Logsdon of Coralville is political director of the Iowa Citizen Action Network, a public interest organization and progressive political coalition committed to creating social change in Iowa and across the nation. Comments: alogsdon@iowacan.org