The Path to Prosperity
Setting the Record Straight
On April 13, 2011, President Obama gave a speech focused on The Path to Prosperity that was excessively partisan, dramatically inaccurate, and hopelessly inadequate to the task of averting the looming fiscal crisis. To learn more from Chairman Ryan in response to the factual missteps and egregious errors in the President’s speech:
Additional false charges about The Path to Prosperity:
MYTH: This budget ends Social Security and Medicare.
FACT: This budget saves and strengthens Social Security and Medicare. The Path To Prosperity makes no changes to these programs for Americans 55 and older. The government guarantee remains in place for both of these programs. It protects both of these programs for those 55 and older and saves them so they can provide benefits to future generations of Americans when they retire. This budget spends more each year on Social Security and Medicare. Additional support would be provided to those with low-incomes and poor health. Failing to act – as the President’s budget does – would mean the end of these programs as we know them. Without action, the Social Security Trustees report that beneficiaries will either see a 22 percent benefit cut or a corresponding hike in payroll taxes. Similarly, the Trustees for Medicare say that “Without corrective legislation, therefore, the assets of the trust fund would be exhausted within the next 7 to 19 years.”
MYTH: The budget cuts benefits for low-income individuals on Medicaid.
FACT:The Path to Prosperity strengthens the Medicaid program by converting the federal share of the Medicaid payment into a block grant – just like the government did with welfare in the late 1990s. The initial allotment would be exactly as much as the states are receiving to pay for Medicaid today, and it would grow every year to account for inflation and population. This would allow states to tailor their programs to their low-income populations, allowing states maximum flexibility to focus their benefits on the specific needs of the state.
FACT: This budget reforms the tax code to make it simpler, flatter and fairer. While The Path to Prosperity proposes lower rates to promote growth, it also ends deductions that go overwhelmingly to a relatively small class of mostly higher-income individuals. And it targets the carve-outs and loopholes that have allowed some corporations to avoid paying taxes altogether. This is not a net tax cut – it is a revenue-neutral reform to make our economy more competitive and help spur job creation and economic growth. It gets the government out of the politically-driven business of picking tax winners and losers. And it spares American employers from having to choose between hiring more workers and paying the highest corporate tax rate in the developed world.
