Over at the excellent Bleeding Heart Libertarians blog, Matt Zwolinski delves into the BHL case for Gary Johnson. The reasons he lists are excellent and well-taken. There is little dispute that there are a great many things that Johnson would do in office that benefit the least-advantaged. What is not mentioned in the article is Johnson's plan for entitlement reform.
Johnson proposes across-the-board 43% spending cuts in all areas, including social support programs. He maintains that as governor of New Mexico he was able to drastically reduce Medicaid spending by switching to a managed care model--a model taken from the more technocratic side of progressivism. There is also a good case to be made that by block granting Medicaid and allowing states to experiment, they will find unique ways of saving money. However, this mandate of spending is harsh, immediate, and non-negotiable.
Compared with Ron Paul's plan for entitlement reform, it introduces greater volatility into the market. Paul's plan calls for social welfare programs to be phased out over the very long term, and provides drastic cuts in spending in other departments to cover the cost of those currently in the system or who had significantly planned to do so. Finally, it provides an exit option for those who would like to opt out of the system entirely--pay nothing in, get nothing out. Overall, the Paul plan is a more radical proposal in that it provides an end to these programs, but is also the more compassionate, in that it does not significantly disrupt the market for those in the system or those who are about to enter.
In addition to Johnson's proposal for healthcare, his tax reform plan is similarly problematic. Johnson supports the abolition of the income tax and replacing it with the Fair Tax, a 23% consumption tax on all goods. The Fair Tax provides rebates for all purchases made up to the poverty line, in anticipation of arguments related to its effect on the poor. However, the poor are more likely to spend most of their money on consumption--unlike the rich who save and invest more--so will likely be impacted more by the Fair Tax. In addition, senior citizens who have paid into the income tax system will be taxed heavily again on consumption. Paul did not present a detailed tax reform proposal, so comparison is difficult.
Both candidates would eliminate HUD, which supplies the housing vouchers many poor families depend on. These vouchers actually have a perverse effect on the housing market, but it is left unclear in both proposals if these HUD department functions would be subsumed into another agency or eliminated outright--I assume the former. Neither candidate has proposed cuts to food stamp programs.
The positive BHL case for their economic proposals likely rests on the reader's acceptance of free market economics. Neither is likely to win converts for slashing corporate taxes, but many would encourage their excising all corporate welfare. Both would repeal the federal minimum wage which would allow states the opportunity to opt out of the system altogether. This is a key feature of economic justice, as the minimum wage eliminates marginal employment or drives it underground.
So where do we end up? I give the nod to Paul for his entitlement reform plan. Johnson's would likely create too much uncertainty in the market and lead to drastic reform. This would eventually even out, but the transition in Paul's plan is much smoother. Keep in mind, however, that Paul's is the most comprehensive plan put forth by any candidate Republican or Obama to reform Medicare and Social Security. Until the fiscal situation become dire enough, that will inevitably continue.
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