The Washington Post devoted a lengthy page 3 article to discussing the cuts to Medicare and Medicaid proposed in President Bush�s new budget. The article failed to give readers the context that would tell them how important these items are in the federal budget. The CBO baseline shows that Medicare and Medicaid combined are projected to account for 22.9 percent of total spending this year and 26.2 percent of spending in 2012. Or, expressed on an average family of four basis, Medicare and Medicaid spending comes to about $8,300 for a family of four in 2007 and $11,300 for a family of four in 2012. In other words, this is real money. But the bigger sin in this piece is the failure to explain the meaning of President Bush�s most important cut to these programs. President Bush wants to eliminate the indexing for the income cutoff after which means-testing would apply to Medicare benefits. Currently, the threshold is set at $80,000 for an individual and $160,000 for a couple. Setting means-testing for those earning above these levels would only affect the highest income elderly, but if the cutoffs are not indexed for inflation, as President Bush proposes, then more middle income people would soon be affected. In twenty years, a single person at the same point in the income distribution as someone earning $40,000 today would be subject to the means-test. In forty years, about the point where Social Security is first projected to face a shortfall, a single person at the same point in the income distribution as someone earning $20,000 today would face means-testing for Medicare. In other words, under President Bush�s proposal, much of the middle-class will have their Medicare means-tested before Social Security is even projected to face a funding shortfall. This should be big news, but this fact is not even mentioned in the article. David Broder, commits the same sin in the Coward�s Corner [a.k.a. the Washington Post opinion pages � a section known for its unwillingness to present alternative views on this issue].
--Dean Baker