What would U.S. Rep. Paul Ryan's budget mean for Michigan families? Using nonpartisan data, the bottom line is stark. If the Ryan budget passes, a tiny proportion of Michiganders would benefit, but millions would lose.
The biggest winners in Michigan would be households making more than $1 million a year. An analysis by the Urban-Brookings Tax Policy Center finds millionaires would pay an average of $265,000 less in taxes.
To make room for new tax cuts for the very rich, the Ryan budget eliminates middle-class tax breaks and cuts social programs. With the tax cut the plan gives to a single Michigan millionaire, communities could pay the salaries of five firefighters earning the state's median household income of $48,000 a year.
Michigan senior citizens would pay more for less security. Medicare guarantees health care for about 1.5 million Michigan senior citizens. But the Ryan budget would end Medicare as we know it.
The plan would require Michigan seniors retiring 10 years from now to use a voucher to help pay for private insurance or accept less Medicare aid. The value of the vouchers would decline over time, falling behind rising health insurance prices. The Congressional Budget Office estimates that senior citizens, or their families, would have to find an additional $6,000 each year to buy the same coverage seniors have now.
The Ryan plan would also make seniors wait until age 67 to get vouchers. That would force 65- and 66-year-olds to buy private insurance if they do not have coverage from employers.
The health reform law would be repealed. The "donut hole" gap in Medicare prescription coverage would reopen, so many seniors would pay more at the pharmacy. In addition, private insurance companies could resume charging seniors much higher premiums and denying coverage because of pre-existing conditions. Young people in Michigan would lose many health and education benefits.
While the Ryan budget does not lay out all the details of the major cuts it would impose, reductions in programs can be estimated by averaging the required cuts across programs on the chopping block. The projected cuts include:
• Substantial decreases in education funding by the end of 2014, leading to thousands fewer Head Start slots, among other things.
• Major cuts in Medicaid, leading to reduced benefits for the roughly two in five Michigan children who are covered by public insurance.
• Reductions in federal Pell Grants, making college attendance more difficult for the roughly 300,000 college students in Michigan who depend on these awards because their parents earn modest incomes.
• Repeal of the health reform law provision requiring private insurers to let parents keep young adults on their plans.
Michigan's poorest families would be the hardest hit. The Center on Budget and Policy Priorities says a whopping three-fifths of the cuts would come in safety net programs. Hunger would grow with major cuts in food aid, hurting the 19% of Michigan residents who rely on food stamps.
Despite the cuts, Ryan's budget does not eliminate the federal deficit. Instead, it would strip the nation of revenue for services we all need -- like clean air, roads and education -- in order to finance big tax reductions for the very wealthy. As a result, the U.S. Treasury would continue to run deficits for decades.
All in all, the Ryan Budget is a windfall for the wealthy few, a bad deal for the rest of Michigan.
H. Luke Shaefer is assistant professor at the University of Michigan School of Social Work. Theda Skocpol is professor of government and sociology at Harvard University.
