This struck me yesterday when I posted Paul Ryan's latest YouTube video, and I almost commented on it then, but now that Congressman Ryan has turned the transcript of the video into an op-ed for Bloomberg News, it's worth mentioning. Here's the sentence from the Bloomberg piece: "We also ensure that lower-income seniors and those with more health risks will receive greater support, while healthy seniors with more resources receive less." Yes, I know there's some of this already in Medicare, but the point is similar to Timothy Pawlenty's means-test for Social Security. The Democrats want to raise taxes on the rich, while the Republicans want to have reduced benefits for the rich. There doesn't seem to be any political party out there making the case for treating all Americans the same regardless of how much money they make, or trying to unite the country rather than finding one group to soak for the benefit of everyone else.
I say this as someone who thinks Mr. Ryan is playing a generally constructive, almost to the point of heroic, role overall. I understand the accounting case for less benefits for the "rich" — the government can't afford to keep the benefits as generous as they are now for everyone. But what's the philosophical or moral case? And what about the moral hazard or perverse incentives created? If your RyanCare "premium support" is going to be higher if you have less money and worse health risk in retirement, and if it is going to be lower if you have more money and better health in retirement, why save money or eat healthy foods or exercise?
Here's an example: Citizen A drove used Toyotas and got up an hour early to go to the gym and make salad for dinner. Citizen B drove new Cadillacs, slept late, and ate McDonald's quadruple cheeseburgers with fries for dinner. Citizen A retires with a healthy heart profile and a big retirement account. Citizen B retires with major cardiac risk and no retirement savings. In walks Congressman Ryan to declare, "lower-income seniors and those with more health risks will receive greater support, while healthy seniors with more resources receive less." Mr. Ryan thinks he's doing justice by redistributing to each according to their needs, but in this case what he's really doing is punishing behaviors that many consider virtues — thrift, industry — while rewarding behaviors that many consider vice – sloth, gluttony, extravagance.
Of course, not all differences in health status or income at retirement are the result of choice. Some may be the result of genetics, parents, luck, or other factors that are beyond an individual's control. Citizen A may be in a wheelchair because his used Toyota was hit by a drunk driver on the way back from the gym, while Citizen B may be still walking on two feet from his Cadillac in the McDonald's parking lot. Still, there's a lot of political philosophy packed into that sentence of Mr. Ryan's about "lower-income seniors and those with more health risks will receive greater support, while healthy seniors with more resources receive less," and you don't have to be Newt Gingrich to want to say, wait a minute, is this really what the Republican Party wants to ride into 2012?
I wrote about this earlier, back in July 2009, in a post headlined "Rove, Ryan Bash the Rich." Back then Mr. Ryan (along with Karl Rove and the Heritage Foundation) were touting a plan in which "Couples making more than $170,000 (without an annual index to inflation) would pay more for their Part B premiums. Part D would be means‐tested at the same level for wealthy retirees."
