OPINION:
Leadership is a word much used but in short supply in the political world today. Politicians forever talk about it but seldom seek to solve big problems by advocating real solutions and then working to find a consensus that can move the country forward. Fortunately, there are at least two public officials who hail from Wisconsin, the Badger State, one in Washington and one in Madison, who are working diligently to turn America away from the fiscal cliff toward which we are headed.
Recently, House Budget Committee Chairman Paul Ryan submitted his blueprint to restore fiscal sanity to the federal government. His 2013 budget foresees an end to trillion-dollar yearly deficits and gradually brings federal expenditures in line with tax receipts at a sustainable level. Rather than ruinous and self-defeating tax increases that will slow the economy, Mr. Ryan’s budget envisions tax reform that lowers rates and eliminates many tax preferences, moves that many economists argue will enhance economic growth and increase federal tax receipts in the out years.
Most important, Mr. Ryan’s budget tackles a program that is growing at an unsustainable pace and driving our annual deficits to ever-higher levels. Medicare was established in 1965 when Lyndon Johnson was president, the Beatles ruled the music charts and the counterculture was coming of age. Much has changed in the nearly 50 years since, but Medicare is still basically the same fee-for-service program. However, it has exploded in recent years as more Americans have reached age 65 and new treatment techniques have been developed. The federal response has been to impose price controls on payments to doctors and hospitals, a solution that threatens to affect treatment quality and access to providers. The program must be reformed if we are to keep our promises to the senior generations to come.
Mr. Ryan’s plan substitutes competition for price controls. He would allow insurance companies to compete to offer packages of medical services to recipients, with the federal government providing “premium support” payments for the insurance coverage.
You would think competition and senior choice would be popular alternatives to shortages and price controls. You would be wrong. Last year, Democrats ran an ad depicting Mr. Ryan pushing a senior off a cliff. Republicans who voted for the Ryan budget last year were attacked by left-wing Democrats and Big Labor. Yet Mr. Ryan has persevered because he knows we cannot get our budget under control unless we deal with health care. It’s called leadership.
At the state level, Gov. Scott Walker inherited a fiscal mess when he took office in 2011. His state was hemorrhaging red ink, and unlike Washington, D.C., Wisconsin must balance its budget. Rather than raise taxes yet again and see Wisconsin become even more economically uncompetitive, Mr. Walker moved boldly to address the problem long-term. He authored a far-reaching reform plan to bring state labor costs under control and give local jurisdictions more flexibility in designing programs that deliver vital services such as education more effectively and efficiently.
His plan required public employees to pay a greater percentage of their income for their health care benefits and fund their retirement at a level comparable to what private-sector workers pay. Furthermore, he limited public-employee unions to bargaining for wages and benefits, but not for “work rules.” This key reform gives enormous flexibility to local school boards, for example, in hiring the right personnel and designing programs that deliver higher educational quality at lower cost. Mr. Walker also promised that his plan would not require layoffs of public employees, a promise he has been able to keep.
The public-employee unions reacted with fury, tying up the capital for months and launching recall elections against several Republican and Democratic state senators. While two Republicans were defeated, the GOP kept control of the Senate. The unions, now financed almost totally without state money, are seeking to recall Mr. Walker, who faces the voters on June 5.
Mr. Walker says he expected pushback, but he feels he is doing what is necessary to ensure the long-term health of his state. It’s called leadership.
Then there is President Obama. His latest budget effort locks in hundreds of billions of dollars of new debt for the next decade. His own figures show annual deficits still in the hundreds of billions of dollars even after another round of tax increases on the “rich.” It is notable that even assuming all of his tax increases become law, we still will be in fiscal purgatory, with no real cap on federal expenditures.
But Mr. Obama already is in election mode, and nothing so blinds a politician as the imperative of re-election.
By contrast, Paul Ryan and Scott Walker demonstrate that there still are public officials who can see beyond their own re-election. It’s called leadership.
Frank Donatelli is the chairman of the Reagan Ranch Board of Governors and serves on Young America’s Foundation’s Board of Directors. He was a senior adviser to President Reagan.
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