Deferred Payment

Someone always has to pay. When you go to war and don't plan a way of paying for it (ex. LBJ and W) then it gets added to the national debt. When you drastically cut tax rates and increase defense spending (ex. Reagan) then it shouldn't be a big surprise when the national debt increases by 189% during your 8 years. When you have a system where every patient has to be admitted to a hospital regardless of their ability to pay then you shouldn't be surprised when health care costs are a large % of the national budget.

Tough decisions have to be made or at least recognized. Politicians on both sides annoy me to no end by talking about how this simple thing will make things completely better. If you elect Mitt Romney he will no longer demonize success in business and by doing just that he will grow the economy. Does anyone really believe that? Does anyone really believe that Paul Ryan's Path to Prosperity can really keep spending at 20% just by saying it will keep spending to 20%.

Unless you come up with truly new, efficient ways of controlling certain costs then you really just shifting the cost from one entity to another. Giving people health care vouchers doesn't really decreases health care spending, but really just means that once the vouchers are up the individual will have to pay for something that the government is paying for now. The really tough decisions are ones like this - is it more important for me to pay a long term capital gains tax of 15% or to let a poor family go hungry because spending on food stamps were cut? If someone doesn't have the money, the insurance and/or the vouchers than do we just let that person die if they are in critical condition? 

Those are tough decisions to make if you are completely strict on controlling costs, refusing to increase revenue and also want to balance the budget. No politician will make that decision. Paul Ryan is suggesting something that would probably scare 75% of Americans if they truly understood the consequences of what he is proposing. Someone has to pay and just shifting the cost from the public sector to the private sector doesn't solve that issue.

My final criticism is an idea that has angered me the more I think about it. When I read that 62% of Paul Ryan's cuts would fall on low income households it makes me a little concerned. I don't mean to be a socialist, but I would rather err on the side of caution in protecting the poor than the rich. The rich do not need the government's help. Mitt Romney will be fine whether he pays 14% in taxes (last year) or 35% (Obama's proposal). Poor people on the other hand do need the help. Sure some of it might be wasted and the idea of someone living off welfare instead of getting a job goes against the American Dream. Still I would much rather have the government try to solve the issues of hunger (food stamps), education (pell grants, public schools), and healthcare for the poor than in trying to address a non-existent "class warfare" issue that so troubles the rich. From a strictly economics side the money invested in poor people is likely spent immediately and spent in the local economy. I doubt many lower income households will be spending their money on a lavish trip to London. However, it goes farther than a strictly economics side, and from a pure humanity side of things I would rather live in a country that helps out the poor than the rich.