One of the most interesting exchanges from President Obama's question-and-answer session with House GOP members earlier today was the one he had with Rep. Paul Ryan over the future of Medicare. As part of his recent set of policy proposals—which he's dubbed the "American Roadmap"—Rep. Ryan proposed some significant changes to how we deal with Medicare. Those over 55 at the time of passage would get see no changes, but those under 55 at the time would get vouchers to pay for medical care in their retirement years. The tax exclusion for employer health insurance would be replaced by a refundable tax credit for the purchase of health insurance. The idea would be to delink health insurance from employment while dealing with Medicare's massive unfunded liability and giving individuals more control of their health care spending—the last part being especially crucial, because, depending on how it works, it's arguably the only proven way of bring down health spending. You can debate the merits of the plan and its specifics, but it's plain that Ryan's done his homework on these issues.
Here's a snippet of Obama talking about the plan with Rep. Ryan:
President Obama: I think Paul [Ryan], for example, the head of the Budget Committee, has looked at the budget and has made a serious proposal. I’ve read it. I can tell you what’s in it. And there’s some ideas in there that I would agree with but there’s some ideas we should have a healthy debate about because I don’t agree with them.” The major driver of our long-term liabilities, everybody here knows, is Medicare and Medicaid and our health care spending. Nothing comes close. That’s going to be what our children have to worry about. Now, Paul’s approach, and I want to be careful not to simplify this, I know you’ve got a lot of detail in your plan, but, if I understand it correctly, would say, we’re going to provide vouchers of some sort for current Medicare recipients at the current level – No?
Congressman Ryan: No – we protect the program for Americans 55 and above [those in and near retirement]…
Obama: I understand – there’s a grandfathering in….That’s why I said I wanted to make sure that I’m not being unfair to your proposal. I just want to point out that I’ve read it, and the basic idea would be that, at some point, we hold Medicare cost per recipient constant as a way of making sure that that doesn’t go way out of whack, and I’m sure there some details…
Ryan: We increase the Medicare payments with a blend of inflation and health inflation. The point of our plan is, because Medicare as you know is a $38 trillion unfunded liability.
Ryan: It has to be reformed for younger generations because it won’t exist. It’s going bankrupt. The premise of our idea is look, why not give people the same kind of health care plan we here have in Congress? That’s the kind of reform we’re proposing for Medicare. [applause]
Obama: As I said before, this is an entirely legitimate proposal. …There is a political vulnerability to doing anything that tinkers with Medicare. And that’s probably the biggest savings that are obtained through Paul’s plan. And I raise that, not because we shouldn’t have a serious discussion about it, I raise that because we’re not going to be able to do anything about any of these entitlements if what we do is characterize whatever proposals are put out there as well, you know, that’s the other party being irresponsible….
There are two points I would make about this exchange, one in Obama's favor, one against. The first is that Obama is right that Republicans, with their relentless demagoguery of anything that smacks of Medicare cuts, have taken a situation in which it was already going to be very difficult to reform Medicare and made it nearly impossible. I don't think you can blame Rep. Ryan for this. But it's made future GOP reforms even less likely.
The second point, though, is that it's more than a little irritating to see Obama speak so well of Ryan's plan and say that it's the sort of thing that deserves "serious discussion." Problem is, throughout the health care debate, Obama didn't want to have that discussion. He didn't want to talk about any plans to significantly reduce entitlement spending, or severing the links between insurance and employment.
Indeed, not only did he make almost no effort to incorporate opposition ideas into his legislation, he wasn't willing to recognize the existence of legitimate opposing ideas at all. Instead, he chose to caricature his opponents as having "no solutions." That's not true now. It wasn't true then. But Obama's approach to most policy and political debates has been to reiterate the notion that his way was not simply the best way, but the only way—or at least the only legitimate, acceptable, reasonable way. His conversation today with Rep. Ryan, I think, is a tacit admission that that's just not the case.
In July, Reason Senior Editor Michael Moynihan spoke with Rep. Ryan about why we don't need more college entitlements: