David Brooks Has Not Heard About the Affordable Care Act
|Tuesday, 20 September 2011 04:20|
That's what readers of his column complaining about President Obama's speech on the budget must conclude. He is upset that Obama:
"whispered about seriously reforming Medicare but then opted for changes that are worthy but small."
If Brooks has heard about the Affordable Care Act (ACA), he would know that it actually provides for large cost controls in Medicare. According to the Medicare trustees report, these cost controls would eliminate almost 80 percent of the long-run deficit projected over the program's 75-year planning horizon.
Brooks could read about these changes in the Congressional Budget Office's (CBO) long-term budget projections. CBO projects that future deficits will be manageable if the controls in the ACA are allowed to take effect. However, CBO concluded that Congress will reverse itself and not allow the controls to bite. However, it seems odd to blame President Obama for the fact that future Congresses might reverse the cost controls that he put into the Medicare program and it is simply wrong to claim that he did not do anything to restrict costs.
It is also worth mentioning that Brooks misrepresents the relative tax burdens of the wealthy and the middle class. He excluded payroll taxes from his calculations, which are extremely regressive. Also, there are a small number of very wealthy people who do in fact pay very low tax rates because the bulk of their income comes from capital gains. This is exactly the situation that President Obama described.