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Time to Call the Tea Party's Bluff

A Commentary By Froma Harrop

Thursday, June 03, 2010

I'm done trying to hack through the tea party thicket of self-contradiction, self-delusion and self-serving positions. My last straw is Rand Paul, a tea party favorite and now Republican nominee for senator from Kentucky.

What damns Paul wasn't the flap over his views on the Civil Rights Act of 1964. Presumably, Paul isn't a racist. He's just a privileged white guy -- a doctor and son of 11-term congressman Ron Paul -- who lacks feeling for America's tragic history of racism.

What makes Rand Paul so exasperating is his crashing hypocrisy on Medicare. The hero to the cause of smaller government and balanced budgets also vows not to touch Medicare -- the biggest and fastest-growing expense on the federal balance sheet. Rand's compromised stance reflects the political necessity of keeping the tea party people happy. The group is heavy with older folk, who have carefully drawn a line of self-interest around the king of government entitlements, Medicare. 

Here's a sample view from a leader of the Rhode Island tea party:

"We understand that the federal government cannot take $500 billion out of Medicare and provide the same medical services to our elderly, all the while offering health care to 30 million new people, without a vast increase in the number of providers, the imposition of massive new taxes and/or the rationing of care."

Where does one start? First off, the new health care legislation does not cut a single guaranteed Medicare benefit. It actually expands the offerings to include screening services and closing the drug-benefit doughnut hole. The savings come largely from ending overpayments to the private Medicare Advantage plans.

As for "the massive new taxes," would the tea party folk please tell us where they are? While they're looking, the public should note that money for the new health care legislation is honestly allocated. That can't be said of the Republicans' 2003 Medicare drug benefit -- a corporate bonanza for which not a penny was funded.  

Our tea party spokeswoman goes on to claim that, in any case, "we paid" for Medicare. Oh, really?

It happens that Medicare payroll taxes provide 40 percent of the program's funding and premiums another 12 percent. The remaining 39 percent comes from general revenues (mostly income taxes). Much of the payroll and income taxes are born by people who won't live long enough to collect benefits themselves. And given the spiraling costs of the program, today's young taxpayers will never see the level of benefits that they are now subsidizing.

What is the extent of the support? A typical couple retiring in 2020 will have paid about $100,000 in lifetime Medicare taxes but will receive $500,000 in scheduled Medicare benefits over the premiums they pay to the program. This is according to C. Eugene Steuerle, a tax policy expert at the Urban Institute.

I asked Steuerle about the income taxes that many Medicare beneficiaries paid and continue to pay. He responded that "given the large deficits we're running and the benefit level relative to previous or current tax levels, there's still no doubt that current generations are being subsidized by future generations."

My question to the tea party's lovers of liberty:  If you really think you've paid for Medicare and hate big government, why don't you demand that this expensive program be ended?

Hey, the same Constitution that (you keep insisting) says nothing about a universal right to health coverage doesn't guarantee health benefits for older people, either. Of course, you will get a refund for those payroll taxes you've paid.

But tea party patriots are not clamoring to lift the taxpayers' yoke of subsidizing their retirements. The phoniness of this movement is hard to calculate. 

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