what we said the domenici/rivlin task force said we have to have a tax holiday and try to get this economy moving beyond sluggishness. we still hold to that. then you begin to phase in deficit reduction. at the end of our plan, you're at about 62 to 65% of gdp and the imf and the world bank want you to be at 60. but this is ten years from now, 15 years from now so, all the numbers are wrong. but you try to make policy changes. i just leave you with three thoughts that i think are important. one we have a bunch of promises that we've made to americans that we can't keep. end of discussion, we can't do it under present circumstances. and we need to think about what breaking those promises mean for the future and for investment in the future. the second thing is don't listen to people who tell you what percentage of gdp it used to be, because if they talk about the last 40 years, you've got three major conflicts in there that caused. so i would say let's go back to 1900 and the percentage of gdp of medicare was, that's correct, zero. and social security was, that's right, zero. and 85% of the

so the domenici-rivlin proposal was not a voucher program, correct? >> no, it was not a voucher. >> and the ryan and wyden proposal was not -- >> not as i understand those terms, no. >> okay. thank you so much. yield back. >> thank you. mr. thompson is recognized. >> thank you, mr. chairman, and thanks to all the witnesses for being here. i'm a little heartened, actually, to hear about -- there seems to be a lot of agreement. everybody agrees we need to fix medicare, we need to make it work, so that's the best news i've heard on this topic for a long time. i would submit, mr. chairman, that it might be helpful as we're looking at this if we had a plan many front of us. we have heard a lot of criticism about mr. ryan's plan, we've heard criticism about the ryan-wyden plan, we've heard those who are proponents of that suggesting that maybe it's not what the critics say it is. it would be good if we had a plan we could actually see the details of that plan and be able to get down in the weeds and look at it. until that happens, we're just going to maybe

at least this document, and there have been now supercommittee, simpson-bowles, domenici-rivlin, gang of six. i think there is some for senators as well. involvement at the. have all kind of plus or minus 15 or 20% have come up with a plan that's got a mix of tax reform, entitlement reform. some additional cutback in domestic discretionary. some cutback in defense. so i think this is a good idea, as a starting point on where we go. i would just make a couple of other comments. for those of us, all of the hours we spent on gang of six, and some of the critiques that we didn't fully finished, i think we're still much further along than the press gave us credit for, but that sure as heck didn't happen overnight. that took enormous weeks and weeks and months, back and forth and negotiating and trying to understand each others' perspectives and ways that i think were valuable. i think the opposite of that was the budget control act, which in a moment of crisis was thrown together and, i detected that from my perspective, was kind of my single moment of embarrassment of being a united state

so the domenici-rivlin proposal was not a voucher program, correct?o, it was not a voucher. >> and the ryan and wyden proposal was not -- >> not as i understand those terms, no. >> okay. thank you so much. yield back. >> thank you. mr. thompson's recognized. >> thank you, mr. chairman. and thanks to all the witnesses for being here. i'm a little heartened, actually, to hear about -- there seems to be a lot of agreement. everybody agrees we need to fix medicare, we need to make it work, and so that's the best news i've heard on this topic for a long time. i would submit, mr. chairman, that it might be helpful as we're looking at this if we had a plan in front of us. we've heard a lot of criticism about mr. ryan's plan, we've heard criticism about the ryan-wyden plan, we've heard of those who are proponents of that suggesting that maybe it's not what the critics say it is. it would be good if we had a plan we could actually see the details of that plan and be able to get down in the weeds and look at it. until that happens we're just going to maybe spin

ron and i ng alice rivlin and pete domenici have been saying, a list of guaranteed coverage options, guaranteed, you can't be denied. and there is a competitive bidding system that makes sure that your benefit keeps up with the price of the insurance. and then -- and you also have the choice of traditional medicare, fee for service alongside that. and then medicare subsidizes your premium based on who you are. if you're a low income person, 100% subsidy, total out of pocket coverage. sicker, more subsidy. a wealthy person gets lower subsidy, because we think we should means test the program doing it this way, using choice and competition, having premium support with competitive bidding guarantees affordability and solvency to the medicare program. and allows us to cash flow the current commitment to current seniors. we think it's smart, we think it's important to do this way. and it's gradual so you don't end up with a debt crisis where you have severe disruptions in people's lives, because medicare is the biggest driver of our debt. if you solve the medicare puzzle, meaning save and

gang of six, simpson- bowles -- which patrols just spoke approvingly -- and ali rivlin and the damage she -- pete domenici. they all have entitlement cuts and tax increases. >> simpson-bowles reduces rates 23% -- >> and increases -- >> revenue. >> eliminating loopholes. >> i will have to eliminate this discussion of the time bei. >> it is not just my opinion, it is the opinion of a whole lot of constitutional law professors, academics, judges, and lawyers who defended this law even if they cannot said that it to this particular -- even if they are not sympathetic to this particular piece of legislation, presidency. >> "the wall street journal" editorial ge- "the president needs a lesson in traditional remedial work you." >> it was approved by congress, but not by a huge margin. number one. no. 2, congress is offer an overturned an act of congress. -- has often overturned an act of congress. >> isn't it unusual for the president to attack the supreme court before they can down the decision -- handed down the decision? >> he is sending them a message to of allave a chance listed as missing of the court by u

approvingly, and alice rivlin -- which charles just spoke approvingly, and simpsoalice rivlin at pete the medici -- pete domenici. each of them have entitlement cuts and increases in revenue. >> simpson-bowles increases -- >> revenue. >> it eliminates -- >> by eliminating loopholes. >> i have to eliminate this discussion. >> i am confident it will be upheld because it should be. that is not just my opinion. a whole lot of constitutional law professors, academics, judges, and lawyers who have examined this law, even if they cannot particularly sympathetic to this legislation or my presidency. >> once again, "the wall street journal" editorial-page -- the president needs a remedial course in judicial review. >> there were two factual errors and to what the president said. it was approved by congress, but not by a huge margin. no. 2, the court as often overturned acts of congress. what it has not done four 3/4 of the century is overturned a major piece of regulatory legislation. but does not what he said. >> isn't it unusual for the president to attack the supreme court of port they and down a decision? b -- before

rivlin the plan you worked on with senator domenici is similar to the house passed budget with private plans that compete against traditional fee-for-service. how can you explain how this controls cost not only for beneficiaries enrolled but also for traditional medicare? >> but also many structured change where the consumer can see there are lots of new innovations how you treat people will with chronic diseases and evidence plans can offer better services to bring down the cost to treat medicare beneficiaries. we believe that would have been and through the bidding process the cost would not come down but not increase as rapidly. the fact the government, to be shin is both would be a benefit to everyboby. >> quality and service could be higher but cost hubie more efficient improbably get better over time more people would leave. but there is a lot of evidence fee-for-service does not do coordination of care very well and coordination is terrible. i.r.a. use it. i watch that. looking at responsibility you are likely to get better results. >> mr. stark is now recognized by minutes. >>

so, everybody has looked at this, whether it's bowles/simpson, the senate six, rivlin-domenici, or the whole range of other non-partisan or bipartisan efforts out there, they've all come to the same basic judgment that there's no plausible way politically, and no really sensible way economically to try to restore fiscal sustainability without that. and tax reform should be part of that, but it requires some spending savings, too. >> so, just to clarify for our audience, am i right in understanding you to be saying that the president would be interested at year-end in a broad discussion about tax reform as you address the series of questions that you mentioned? >> oh, absolutely. and again, i think tax reform is coming. it's inevitable. it's necessary. it's all about the shape of it. and, you know, we're going to have to make another substantial contribution on the spending side, too. and those things should proceed in parallel, and we're going to have to find some way to put in place a framework for doing those things at the end of the year. >> so, let me shift now to -- >> can i say j

recommendation from the bipartisan policy center, cochaired by it senator pete domenici and former cbo director and clinton omb director alice rivlin, also testifying today. it is in this vein that the 2013 house budget includes a premium support proposal. we have drawn upon the ideas that are witnesses have proposed over the past two decades and put forward a plan to protect medicare from future generations. there certainly will be different opinions about how a premium support proposal should work. that is a healthy discussion. however, simply hiding our heads in the sand is not. house republicans have made it abundantly clear that we will not simply watch medicare become insolvent. my friend on the other side may not like our proposal to protect the medicare program, but where is yours? relying on $14 billion in savings from so-called delivery reforms in the health care law is not going to say the program. they predict the demise of the program in 10 years. there is some time before it faces the dire shortfalls, however, we would be wise to heed the charge given to was by the medicare trustees and begin to work on this now to pl