Dems’ Plan for Medicare: Increase Taxes

March 29, 2011

FYI, a similar version of this release below went out to the following districts: Jason Altmire (PA-04), John Barrow (GA-12), Sanford Bishop (GA-02), Tim Bishop (NY-01), Dan Boren (OK-02), Leonard Boswell (IA-03), Bruce Braley (IA-01), Dennis Cardoza (CA-18), Russ Carnahan (MO-03), Ben Chandler (KY-06), Gerry Connolly (VA-11), Jim Cooper (TN-05), Jim Costa (CA-20), Mark Critz (PA-12), Henry Cuellar (TX-28), Peter DeFazio (OR-04), Joe Donnelly (IN-02), Raul Grijalva (AZ-07), Martin Heinrich (NM-01), Brian Higgins (NY-27), Jim Himes (CT-04), Maurice Hinchey (NY-22), Ruben Hinojosa (TX-15), Tim Holden (PA-17), Rush Holt (NJ-12), Jay Inslee (WA-01), Steve Israel (NY-02), Bill Keating (MA-10), Dale Kildee (MI-05), Ron Kind (WI-03), Larry Kissell (NC-08), Rick Larsen (WA-02), David Loebsack (IA-02), Jim Matheson (UT-02), Carolyn McCarthy (NY-04), Mike McIntyre (NC-07), Jerry McNerney (CA-11), Michael Michaud (ME-02), Brad Miller (NC-13), Bill Owens (NY-23), Frank Pallone (NJ-06), Ed Perlmutter (CO-07), Gary Peters (MI-09), Collin Peterson (MN-07), Chellie Pingree (ME-01), David Price (NC-04), Nick Rahall (WV-03), Loretta Sanchez (CA-47), Kurt Schrader (OR-05), Heath Shuler (NC-11), Adam Smith (WA-09), Betty Sutton (OH-13), John Tierney (MA-06), Niki Tsongas (MA-05), Pete Visclosky (IN-01), Tim Walz (MN-01), Anthony Weiner (NY-09), David Wu (OR-01), John Yarmuth (KY-03)

Shuler’s Plan for Medicare: Increase Taxes
Democrat Budget Lets Medicare Go Bankrupt, Which Would Require a 23% Payroll Tax Hike

Washington — President Obama and Democrats like Heath Shuler in North Carolina support a Democrat budget that knowingly lets Medicare go bankrupt. The consequences of such a plan, according to a recently issued report by the trustees of the Medicare fund, will result in the program’s trust fund running out of money in 2029 and require a 23% payroll tax hike on workers across the country to make up the difference. In failing to present a viable plan to protect Medicare for future generations, Shuler is standing by the alternative of a 23% payroll tax hike.

“In failing to take a stand to protect and preserve Medicare, Heath Shuler is once again siding with his Democrat leaders in D.C. who are fighting to protect the broken status quo instead of promoting solutions,” said NRCC Communications Director Paul Lindsay. “Shuler’s choice to let Medicare go bankrupt means that he will force upon families and small businesses in North Carolina a 23% payroll tax hike that we can’t afford.”

President Obama received criticism when he avoided addressing the problems of funding entitlements in his budget plan:

“Having been given the chance, the cover and the push by the fiscal commission he created to take bold steps to raise revenue and curb entitlement spending, President Obama, in his fiscal 2012 budget proposal, chose instead to duck. … The larger problem with the budget is the administration’s refusal to confront the hard choices that Mr. Obama is so fond of saying must be faced. The president’s debt commission concluded that more tax revenue will be needed in coming years to finance the costs of an aging society.” (Editorial, “President Obama’s budget kicks the hard choices further down the road,” The Washington Post, 2/15/11)

“Yet the biggest shortcoming is that it all but ignored the most important long-term financial challenge, which is the growing cost of entitlements such as Medicare and Medicaid.” (Editorial, “Obama’s overly tame budget,” Los Angeles Times, 2/15/11)

According President Obama’s own Medicare Trustees, the trust fund that pays for Medicare benefits is estimated to run dry in 2029, requiring an immediate 23% increase in payroll taxes that will affect all families and small businesses:

“Over 75 years, HI’s [Hospital Insurance’s] estimated actuarial imbalance is 23 percent as large as payroll taxes, and 16 percent as large as program outlays.” (Timothy F. Geithner, Hilda L. Solis, Kathleen Sebelius, and Michael J. Astrue, “A Summary of the 2010 Annual Social Security and Medicare Trust Fund Reports,” Social Security Online, Accessed 3/28/2011)

“The projected HI deficit over the next 75 years is 0.66 percent of taxable payroll, down from last year’s estimate of 3.88 percent. Eliminating this deficit would require an immediate 23 percent increase in payroll taxes or an immediate 15 percent reduction in benefits—or some combination of the two. Delaying action would require more drastic tax increases or benefit reductions in the future.” (“Issue Brief: Medicare’s Financial Condition: Beyond Actuarial Balance,” American Academy of Actuaries, Nov. 2010)

In standing with his Democrat leaders who provide no alternative, Heath Shuler is signaling that he is content to increase payroll taxes by 23% in order to pay for Medicare. North Carolina families and workers are looking for leadership in these uncertain times, which will make Shuler’s decision to let Medicare go bankrupt and raise taxes for families and businesses rather disappointing.

Dems’ Plan for Medicare: Increase Payroll Taxes by 23% http://ow.ly/4oKjK #MadeinWDC

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