• “Budget debate is all heat and no light”

    Don Taylor:

    The current budget debate is all heat and no light. If we extend the current tax code to 2020, then even if we eradicate (read put to 0) all the domestic discretionary spending in the federal budget, we will have a deficit in 2020 just paying for health care (Medicare, Medicaid, ACA subsidies), Social Security, Defense and Interest on the debt. All the words being spilled about NPR and agricultural subsidies are a sideshow at best. The essence of this paragraph will not change even if the ACA is repealed.

    He goes on to discuss the health reform ideas of Michael Cannon of the CATO Institute and then ends with a focus on the employer-sponsored health insurance tax subsidy. It’s worth a read.

    • “the substance of this paragraph will not change even if the ACA is repealed.”

      does this imply that Taylor thinks ACA is neutral, or is Taylor simply choosing to remain agnostic on that?

    • @frouglas

      I am saying that we would still have a deficit in 2020 under assumptions I noted (extend tax code, other spending same) even if ACA repealed. You would lose the extra spending in insurance subsidies from ACA, but also the increased tax revenue and Medicare cuts. Total Medicare would be on the order of ~$925 Billion without ACA and around $900 Billion with it in 2020 (from memory). Even if you repealed ACA but kept the Medicare cuts enshrined in it, you would still have a deficit even with every other dime of federal spending ended.
      Don Taylor

    • @ don taylor – thanks for the clarification.