Ryan Transforming Medicare Into Corporate Welfare

Representative Paul Ryan released a budget proposal in February which intends to turn Medicare, the government-administered single payer health care plan for American seniors into "premium support." The plan has the federal government cutting checks to private insurers, who will charge seniors even more money for the care that the insurance companies will ultimately deny for profit. Even Newt Gingrich called Ryan's Folly "radical" and "right-wing social engineering." The bizarrely abrupt and poorly considered plan has driven the NY-26 special election from a conservative cakewalk to a race in which the NRCC is dumping money to defend safe Republican territory.

Today, Ryan made a stunning admission about his plan, though staying far away from details to the Economic Club of Chicago:

Ryan reframed the entitlement cuts in his budget as "strengthen[ing] welfare for those who need it," and accused Democrats who have attacked his budget as engaging in class warfare.

The only recipients of benefits under Ryan's Folly are insurance companies. They receive a whole generation of customers who are kicked out of Medicare. For those Medicare recipients (those currently over 55 theoretically) who aren't directly affected by Ryan's Folly, the strength of the program's bargaining power in the marketplace (one of the few forces holding prices down in the health market) will dissipate. That means insurance companies will enjoy more customers with higher premiums. HMOs will receive additional corporate welfare under Ryan's Folly, receiving surplus funds from the federal government in addition to the premiums that they'll charge America's seniors. Ryan's plan to tax Americans to pay health insurance company bureaucrats is an enormous transfer of wealth into corporate pockets.

Ryan attacks critics of his plan--ostensibly me--as engaging in a class war. I suppose it's true; if people want to oppose an assault on the middle class that will artificially transfer wealth into the hands of a few insurance company executives, that pits them into a class war against Ryan's Folly. His plan is an attempt to plunder the middle class to unfairly benefit the wealthy and powerful. His critics are waging a battle to protect the modern American social compact against crony capitalism. It's a class war of necessity, whereas Ryan engaged in his attack as a class war of choice. To paraphrase Barack Obama, I am not opposed to all class wars, just dumb ones.