What does it take to unify a notoriously fractured Democratic leadership? Threats of a government shutdown and violent oppression in Libya are no match for the unifying force that is Rep. Paul Ryan’s (R-WI) proposal to slash Medicare funding. Ryan’s plan is to turn Medicare into a private voucher system, which he has said will save $400 billion over the next ten years. 

Rep. Paul Ryan

This comes as the government is facing the prospect of a budget shutdown because of the two parties’ inability to agree upon a budget. President Barack Obama has said that he does not want to accept more stop-gap measures to fund the government.

Democratic Senator Max Baucus, a key figure in the Obama Administration’s health care reform debate, ripped Ryan’s plan. "The Ryan plan is very simple and it’s just so wrong,” he said in a statement. “It takes money away from senior citizens and it transfers that money to health insurance companies that will then drive up their profits, pay their CEO’s salaries and pay their bonuses."

House Minority Leader Nancy Pelosi and Rep. Steny Hoyer also quickly came out in opposition to the assault on the entitlement program, which makes up about 13 percent of federal government spending, declaring the Republican budget plan a non-starter.

From Talking Points Memo:

This is worlds different than the current spending fight, where Dems adopted the GOP argument without hesitation, and as a result are stuck accepting cuts to social programs they don't agree with. The next several months will be interesting.

TIME magazine has a breakdown of the Medicare plan:

• Makes Medicare voluntary and have seniors pay more out of pocket for health care. 
• Eliminates provisions of the Democrat’s Affordable Care Act. 
• Raises the retirement age from 65 to 67 by 2033.

The New Repubic’s Jonathan Chait writes that the cuts are more than what’s necessary to save the program:

But Ryan's level of cutting goes far beyond what's needed to preserve those programs, and it does so in order to clear room for a very large, regressive tax cut. He is making a choice -- not just cut Medicare to save Medicare, but also to cut Medicare in order to cut taxes for the rich.

Ryan does not want to debate that choice, but he ought to be forced to do so. That is exactly what Bill Clinton did to defeat the Republicans in 1995. Indeed, the debate was virtually identical. Republicans insisted the debt constituted an existential threat. They proposed to "save" Medicare by privatizing it. And Clinton pointed out that their plan cut Medicare in order to finance a regressive tax cut. He won the argument because Medicare is highly popular and tax cuts for the rich aren't.

Economists opposed to Ryan’s plan say the proposal relies on fairytale economics. Liberal economist Paul Krugman, citing the Congressional Budget Office’s Analysis of the proposal, wrote in a blog post that “a typical senior would end up spending more than twice as much of his or her own income on health care as under current law. As Dean Baker points out, this means that seniors would end up paying most of their income for health care.”

Ryan’s economic and fiscal fantasy goes further, Krugman writes, by arguing that under his plan unemployment could drop to 2.8 percent by 2021, lower than it’s been in 50 years.

Reach Ryan Faughnder here. Follow on Twitter here.