So, a full accounting of how Ryan's budget would affect your budget must consider how much he would cut our taxes and how much he would cut our transfers.

TAXES. Ryan cuts income tax rates and abolishes investment taxes to reduce government revenues by about $450 billion* per year over the next ten years. (That's after he makes permanent the Bush/Obama tax cuts.)





"Those making $1 million or more would enjoy an average tax cut of $265,000 and see their after-tax income increase by 12.5 percent," TPC We don't know exactly how Ryan's tax cuts would break down by family income level, but the Tax Policy Center has published an estimate based on the Ryan-inspired budget passed by the House of Representatives this year. The upshot is that the federal income tax code -- the one highly-progressive part of our tax system -- would become significantly less progressive. Taxes would barely change (or even rise) on the low-income Americans, and the top 1% would see a windfall from the elimination of taxes on most of their investment income."Those making $1 million or more would enjoy an average tax cut of $265,000 and see their after-tax income increase by 12.5 percent," TPC found . "By contrast, half of those making between $20,000 and $30,000 would get no tax cut at all."**

SPENDING. Ryan is most famous for his Medicare plan, but if his budget became law at midnight tomorrow, the most dramatic changes over the next ten years would be everything but Medicare. That's because Ryan's long-term plan to move Medicare from a defined-benefit fee-for-service system (where government is your insurance) to a defined-contribution system (where government writes you a check to help you pay somebody else for insurance) is truly a long-term plan. It wouldn't begin to take effect until the early 2020s. The typical family might prepare for a more modest Medicare by putting more money away. They might leave more of their salaries in a savings account. They might invest in the stock market, with the understanding that any gains wouldn't be taxed. They might use their modest income gains to buy a house, with the intention to sell at a tax-free gain later.

Ryan slashes deeply, but he spares defense and Social Security, which, together, account for 40% of the budget. That means his $4 trillion in cuts come mostly out of health care spending, income security spending, and basic government duties. By 2023, Ryan would spend 16 percent less than Obama on income security programs like unemployment benefits and food stamps. He would spend a quarter less on transportation, and 13 percent less per veteran, according to Brad Plumer. Medicaid spending would be shaved by about a third, and the Urban Institute calculated that a similar proposal would force the states to drop between 14 million and 27 million people from Medicaid by 2021 (note: that's an extreme prediction). It's not clear exactly what programs would be cut, or by exactly how much. What is clear is that everything within the bundle of government responsibility -- from subsidizing science research to subsidizing education to keeping up national parks and law enforcement -- would come under pressure for cuts to make room for the massive and regressive cuts to taxes.