by Jane M. Orient, M.D.,
The latest Mediscare ad shows Congressman Paul Ryan (R-Wis.) pushing an old woman in a wheelchair off a cliff. The Republicans are allegedly killing “Medicare as we know it.” But this is a diversion from the real question: What will “healthcare reform” or ObamaCare do to Granny? Democrats may hope to keep Americans from figuring that out until after the 2012 election.
The Medicare issue is demagogued to gain votes in every electoral cycle. And hardly any politicians are telling the whole story.
The ad has one element of truth. There is indeed a financial cliff, and Granny is heading over it—along with the rest of us. Actually, the cliff is more like the edge of a deep canyon of reckless deficit spending and a crippled economy. The canyon has been growing deeper and deeper, at an accelerating rate. The edge is coming closer and closer. Soon Granny won’t even need a push.
Paul Ryan is not responsible for it. The excavation was mandated some 75 years ago, when Social Security was originally set up, and the problem was greatly magnified in 1965, with the passage of the amendments that created Medicare and Medicaid. The fact is that Social Security and Medicare were never adequately funded. They were structured as Ponzi schemes from the beginning.
Those who call for “saving Medicare as we know it” are asking to save a deceitful, doomed scheme like the one that landed Bernie Madoff in prison.
There are some differences, however. People chose to invest with Bernie Madoff. They are forced to pay their payroll taxes. Further, Madoff’s investors have a legal, contractual right to get their money back—and up to a point, they could have. Those who didn’t bail soon enough might eventually get a few pennies from the bankruptcy court. Retired persons, on the other hand, have no actual right to a penny from Social Security or Medicare. Those on Medicaid have no contractual rights either. They are totally dependent on what politicians choose to give them. And what government gives, it must first take—from increasingly impoverished and surly taxpayers.
But wait a minute! Aren’t retired people simply getting back the money they paid in taxes throughout their working lives? Isn’t Social Security a mandatory retirement savings scheme, and Medicare an insurance program, funded by premiums?
No, they are not—according to the Roosevelt Administration and the U.S. Supreme Court—no matter what impression working people might get from the periodic statements they receive.
When the constitutionality of Social Security was challenged in Helvering v. Davis, in 1937, the government argued that the tax and the benefits were totally separate. The tax was to fund the functions of government, and the benefits were for promoting the “general welfare.” This, of course, is not what people were told when the law was passed; they thought they were getting an annuity or insurance—not a “gratuity” or “bounty” to which they had no legal right.
The government actually has used the payroll tax revenues for anything it liked. The “trust funds” contain nothing but IOUs, which give the government authority to spend money. But the actual money has to come from current taxes or borrowing.
There is no way the government can keep the promises that have been made; there isn’t enough money in the whole world. Both the Obama plan and the Ryan plan are ways to renege on the impossible promises.
The dollar amount of spending in the two plans is virtually the same for all persons over the age of 55. The big difference is that under the Ryan plan younger persons would receive a voucher of a specified amount. That amount would belong to a named individual, who would have some choice about how to use it. The current system puts all the funds into a giant collective pot to be doled out as the bureaucrats choose.
And how will the bureaucrats put the brakes on the open-ended spending promises? Under ObamaCare, they will put a hard cap on total spending (a global budget), and “incentivize” providers to do less work—by not paying them for it.
Say Granny develops a medical problem. Today, her doctor might be able to pull her back from the brink so she can enjoy more months or years of life. What ObamaCare does is push her doctor over the edge, or at least out of practice. When Granny falls too, the Democrats will try to claim that it isn’t their fault.
Medicare forced all retired Americans into dependence on a corrupt and irresponsible government. Ryan has at least recognized the need to pull back from the abyss and find a better way.
Jane M. Orient, M.D., On Air contributor speaking on Healthcare Reform. Dr. Orient has appeared on some of the largest TV and Radio Networks in the country and her op-eds have been printed in hundreds of local and national newspapers, magazines, internet, followed on major blogs and covered in the Wall Street Journal and The New York Times.
Doctor Orient is the Executive Director of Association of American Physicians and Surgeons and has been in solo practice of general internal medicine since 1981. She is a clinical lecturer in medicine at the University of Arizona College of Medicine. She received her undergraduate degrees in chemistry and mathematics from the University of Arizona, and her M.D. from Columbia University College of Physicians and Surgeons. She is the author of Sapira’s Art and Science of Bedside Diagnosis; the fourth edition has just been published by Lippincott, Williams & Wilkins. She also authored YOUR Doctor Is Not In: Healthy Skepticism about National Health Care, published by Crown. She is the executive director of the Association of American Physicians and Surgeons, a voice for patients’ and physicians’ independence since 1943. Complete curriculum vitae posted at http://www.drjaneorient.com.