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Budget in the Balance

The GOP gambles on entitlement reform.

Apr 11, 2011, Vol. 16, No. 29 • By STEPHEN F. HAYES
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If there is one thing that political strategists, pollsters, and elected officials of both parties have agreed on for decades, it’s that entitlement reform is a sure political loser. Social Security is the “third rail”—touch it and you die. Suggest changes to Medicaid and you don’t care about the poor. Propose modest reforms to Medicare and you’re the target of a well-funded “Mediscare” campaign that ensures your defeat.

Marco Rubio

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No longer.

“People are getting it that these things are unsustainable,” says Karl Rove. “For so many people, debt is no longer abstract. It’s more concrete. I don’t know if it’s seeing Greece on TV or what. It’s still tough, but it’s not the political loser it used to be.”

Other influential Republicans go further. They believe that getting serious about entitlement reform can be politically advantageous. 

“I think it can be a real winner for Republicans if we handle it the right way,” says South Carolina senator Jim DeMint. 

Senator Marco Rubio, Republican of Florida, agrees. “I think that some in the Democratic party have made the calculated decision that they are hoping that some of us start talking about this so they can use this as a political tool against us. I think it will backfire.”

In a speech at the American Enterprise Institute, New Jersey governor Chris Christie said it was time for Republicans to “put up or shut up” on entitlement reforms and argued that tackling the problem—and treating voters as adults—would redound to their credit, just as his own blunt talk has caused his approval ratings in New Jersey to rise. “[I’m] more popular today than I was the day I was elected, and that’s in a state that is as Democratic as any state in America for a Republican governor.” 

Brad Todd, a GOP strategist who helped run Ron Johnson’s winning campaign for senator in Wisconsin and works with the National Republican Congressional Committee, says Republicans should be aware of the potential downsides of engaging on entitlement reform but warns that they may not be taken seriously if they fail to lead. “The calculus on entitlement reform has changed,” he says. “Republicans are taking some chances by making it an issue. But at the same time, it’s incredibly risky for Republicans not to engage on entitlement reform. It’s impossible for Republicans to succeed with independent voters without winning on spending issues. And it’s impossible for Republicans to win on spending issues without engaging on entitlements.”

So have things really changed? We’ll soon find out. 

On April 5 or 6, Representative Paul Ryan, chairman of the House Budget Committee, will present his 2012 budget proposal. The document will be far more than just a spreadsheet of the government’s revenues and expenditures. Ryan has put together a plan intended to serve as the blueprint for conservative governance for decades to come, with the ultimate goal of reversing the unbounded growth in the nation’s debt. His budget will include bold proposals on tax policy, significant reforms of discretionary spending (including caps), and a major overhaul of the entitlement programs that threaten to drive the United States into insolvency.

It will include target numbers for the funding of Medicare and Medicaid that will require major structural reforms of those programs. Ryan has chosen to leave reform of Social Security for another day, with the hope that President Obama will, at some point, want to join his crusade for broad entitlement reform. Although Ryan’s budget will not prescribe a single path to his objectives, instead leaving his colleagues free to fill in the details, Ryan’s views on health entitlement reform are well known. In his “Roadmap for America,” Ryan has argued that Medicaid should be block-granted to the states and Medicare should be transformed from a guaranteed benefit program to one that provides vouchers to individuals, enabling them to make health care purchases in the private market. 

The House Republican embrace of entitlement reform wasn’t inevitable. Ryan initially faced resistance from Republican leaders, who were understandably concerned that having their party own entitlement reform would leave them vulnerable to dema-goguery. But they permitted Ryan to conduct tutorials on the budget and entitlements with small groups of House freshmen over the past several months. By encouraging the most aggressive deficit hawks to join Ryan’s push for reform they were, in effect, recruiting for the other team. 

The turning point came when President Obama—after calling repeatedly for an “adult conversation” on entitlements—presented a budget proposal that failed to address the issue in any serious way. Obama was roundly criticized, and not just by Republicans. Editorial pages that are usually friendly to the president ripped his abdication of leadership. 

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