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From the Senator’s Desk

Courtesy of the Republican staff of the Joint Economic Committee: 

Politifact this afternoon issued a “ruling” calling Mostly False a statement that Obamacare utilized Medicare funds to pay for its coverage expansions.  The Politifact piece claims – correctly – that other Presidents have signed laws reducing Medicare spending, and that therefore claims about Obamacare’s impact on Medicare are overblown.  However, there’s a BIG difference between those prior laws and Obamacare – Obamacare used Medicare savings to pay for more government spending.  On that count, there is near universal agreement that’s exactly what the law did:

·         The non-partisan Congressional Budget Office said that the Medicare reductions in Obamacare “will not enhance the ability of the government to pay for future Medicare benefits” – because those savings will be used to fund other unsustainable entitlements.  If Democrats want to use the Medicare savings provisions to extend the life of the Medicare trust fund – and not to fund the new entitlements created by the law – the Congressional Budget Office previously estimated what the fiscal impact would be:  “A net increase in federal deficits of $260 billion” through 2019.

·         Likewise, the Medicare actuary has written that the Medicare provisions in the law “cannot be simultaneously used to finance other Federal outlays (such as the coverage expansions under the PPACA) and to extend the [Medicare] trust fund, despite the appearance of this result from the respective accounting conventions.”

·         Back in November, even Nancy Pelosi admitted that Democrats “took a half a trillion dollars out of Medicare in [Obamacare], the health care bill” to pay for more federal spending.  

President Obama himself admitted the problems with Obamacare’s supposed logic in a 2010 interview, when he stated that “You can’t say that you are saving on Medicare and then spending the money twice.”  Yet that’s EXACTLY what the law did – and no amount of spin can change that fact.

On Twitter

SenMikeLee

The last time the Senate's Democrat majority passed a budget, the iPad did not yet exist: http://youtu.be/2fMfwDm6w18 

SenLeeComs

GOP Budget leaders say lack of Senate budget a failure of 'moral leadership' http://ow.ly/cSUYu  @BudgetGOP #3YearsNoBudget

SenLeePressSec

Working from our SLC office today! If I worked here permanently, I fear all of my money would be spent at City Creek during lunch breaks.

SenLeeResearch

@kc135guy Thanks, that's some great info. We keep a close eye on the #Fed and support significant monetary reform: http://bit.ly/I2ytVG

Around the Water Cooler 

US government’s foreign debt hits record $5.29 trillion

The money the U.S. government owes to foreign entities rose to a record $5.2923 trillion in June, according to data released by the U.S. Treasury Wednesday afternoon.

From the Senator’s Desk

Courtesy of the Republican staff of the Joint Economic Committee:

Ezra Klein has a post this afternoon in which he claims that Democrats have a plan to reform Medicare, but that this plan is fundamentally different from the vision conservatives have put forward.  To which only two questions show the incomplete nature of Democrats’ supposed “plan:”

1.     How does the Democrat plan deal with changing demographics?  As we previously noted, CBO has estimated that changing demographics represent at least half, and up to three-quarters, of the shortfall in entitlement programs over the coming generation.  What this analysis means is that, even if the growth of health costs does manage to slow (and both CBO and the Medicare actuary think Obamacare’s cost reductions will not be sustainable in the long-term), slowing health costs alone won’t solve Medicare’s financial problems. 

The House Republican budget addresses the demographic bulge in part by raising the Medicare retirement age for future generations.  How does the President propose to address this issue?  He doesn’t – he has consistently ducked it.  Does he want to raise taxes (again) to address the demographic concerns?  He won’t say.  Will the President agree to raise the retirement age?  Maybe – but he hasn’t said so publicly, and he most likely won’t before November 6.  So the President’s views on how to address the “Baby Boom bulge” are unclear – because he has avoided these issues for political gain.

2.       Where are the IPAB nominees?  Klein’s post admits that the “most famous” way the President would reduce Medicare costs is through the Independent Payment Advisory Board (IPAB).  Klein also notes that the President has proposed “expanding IPAB’s mandate such that it can change Medicare’s benefit package” and lowering Medicare’s overall growth rate.  But here’s the interesting thing:  According to page 426 of the statute, the law appropriates funds for IPAB (originally $15 million, but lowered to $5 million last December) “for fiscal year 2012” – that’s the fiscal year ending this September 30.  So Obamacare contemplates IPAB being up and running NOW – yet President Obama has failed to nominate any appointees to the board.  If the President wants to save Medicare so badly – and IPAB is so critical to saving Medicare – what’s he waiting for?  And if IPAB is so innocuous and won’t harm seniors, why is he waiting until AFTER his re-election campaign to announce who he wants to put on the board? 

Klein would probably argue that conservatives will oppose whomever the President nominates, so there’s no point in the President putting forward appointees now who are going to get attacked.  But it’s more than a tad hypocritical for Democrats to be gleeful about running “Mediscare” attack ads against conservatives – only for these same Democrats to claim they can’t put forward IPAB nominees whose records will be subject to similar public scrutiny.  And given the massive powers of the IPAB officials – the rulings of these bureaucrats will be exempt from both administrative AND judicial review – there’s a good government argument to be made that the American people should have full knowledge of who these powerful people will be BEFORE they make their choice in November.

When it comes to both the demographic challenges facing Medicare, and the specific IPAB officials who will implement the lynchpin of Obamacare’s plan to lower costs, President Obama has failed to offer any specifics or any vision – meaning that even under favorable circumstances, the best grade one can offer for the President’s Medicare “plan” is an Incomplete.

On Twitter

SenMikeLee

This article does a good job explaining my opposition to the UN's disability convention: http://ow.ly/cNANP 
 

SenLeeComs

GOP Budget leaders say lack of Senate budget a failure of 'moral leadership' http://ow.ly/cSUYu  @BudgetGOP #3YearsNoBudget

SenLeePressSec

Lee: One year ago the S&P downgraded the US credit rating. Cut, Cap, and Balance would have preserved the AAA ratinghttp://on.fb.me/gICihR 

SenLeeResearch

How #ObamaCare creates incentives for employers to stop expanding and stop hiring: http://on.wsj.com/MSRYWa  #jobs#unemployment #tcot #tlot

Around the Water Cooler

Social Security surplus dwarfed by future deficit

As millions of baby boomers flood Social Security with applications for benefits, the program's $2.7 trillion surplus is starting to look small.
 

Investors prepare for euro collapse

Otmar Issing is looking a bit tired. The former chief economist at the European Central Bank (ECB) is sitting on a barstool in a room adjoining the Frankfurt Stock Exchange. He resembles a father whose troubled teenager has fallen in with the wrong crowd. Issing is just about to explain again all the things that have gone wrong with the euro, and why the current, as yet unsuccessful efforts to save the European common currency are cause for grave concern.