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Thursday, March 04, 2010

Small Biz Health Care Daily: Ryan on ObamaCare

In case you have not read it, The Wall Street Journal does the right thing today by publishing the remarks of U.S. Rep. Paul Ryan (R-WI) from the President’s health care summit. Ryan offered something that was otherwise largely missing – sound, realistic economic and policy analysis.

Two summary points worth noting here:

• Since the Congressional Budget Office can't score your bill, because it doesn't have sufficient detail, but it tracks very similar to the Senate bill, I want to unpack the Senate score a little bit. And if you take a look at the CBO analysis—analysis from your chief actuary—I think it's very revealing. This bill does not control costs. This bill does not reduce deficits. Instead, this bill adds a new health-care entitlement at a time when we have no idea how to pay for the entitlements we already have.

• And so when you take a look at all of this; when you strip out the double-counting and what I would call these gimmicks, the full 10-year cost of the bill has a $460 billion deficit. The second 10-year cost of this bill has a $1.4 trillion deficit. . . . [P]robably the most cynical gimmick in this bill is something that we all probably agree on. We don't think we should cut doctors [annual federal reimbursements] 21 percent next year. We've stopped those cuts from occurring every year for the last seven years. We all call this, here in Washington, the doc fix. Well, the doc fix, according to your numbers, costs $371 billion.

In an accompanying editorial, The Wall Street Journal noted: “The President was (miraculously) struck dumb by Mr. Ryan’s critique…” The Journal also correctly pointed out that when the President invokes the authority of CBO, he “misses the reality that if you feed the agency phony premises, you are going to get phony results at the other end.”

Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council

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