A Conservative Critique Of Paul Ryan’s Budget

James Pethokoukis at the American Enterprise Institute isn’t too thrilled with Paul Ryan’s new budget plan:

[S]ince Ryan’s PTP also serves as the fiscal 2014 budget resolution for House Republicans, the blueprint is far from ideal:

1.  If the GOP’s Medicare reform plan is such a good idea (and budget deficits are such a problem), it should be implemented before 2024. Ryan knows this, surely.

2. There’s no Social Security reform plan.

3.  The plan repeals Obamacare, which is highly unlikely. Better to have shown how the ACA can be fixed.

4. The plan lowers the top tax rate to 25%, which, like an Obamacare repeal, ain’t going to happen. The reduction — the path to which remains unspecified — also will require fiscal gymnastics so as to a) not lose revenue and b) not raise taxes on the middle-class. Tax reform is an opportunity for the GOP to show it is the party of parents and kids, not just the party of heroic entrepreneurs and CEOs. Better to have a higher individual rate and dramatically reduce the current tax code’s bias against investment capital and human capital.

5. Does nondefense discretionary spending need to be cut further? Again, this is a result of having to make the numbers work while also delaying Medicare reform.

6. Why does the budget need to balance in ten years? Debt reduction doesn’t require balance, just that the economy is growing faster than the debt. While the plan does put the debt/GDP ratio on a downward trajectory — rather than merely stabilized as Obama and the Senate Democrats would do — it probably doesn’t need to be quite as steep.

For me, items 3 and 4 are perhaps the most egregious. Basing your entire plan on events that are clearly not going to happen isn’t honest in budgeting, it’s pure political theater.

FILED UNDER: Congress, Deficit and Debt, Quick Takes, Social Security, Taxes, US Politics,
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020.

Comments

  1. C. Clavin says:

    Correct…pure political theater…and he is a lousy actor portraying someone who cares about the deficit…when it is really (as Pethokoukis says) all about protecting the income of the wealthy. Ryan is an heir to a fortune built on Government work…his motivations should not be suprising.

  2. grumpy realist says:

    Pethokoukis would do a damn sight better if he stopped whining about the supposed bias against capital and started bitching about the very active bias against income earned by labour.

    Capital Gains should be taxed at the same level as ordinary income. This is called “indifference” by tax planners and if the so-called Free Market geeks really believed in what they preached, they’d yammer for it.

  3. Markey says:

    “The plan repeals Obamacare, which is highly unlikely.”
    ————————————

    But that`s what the base want´s to hear! WooT

  4. john personna says:

    The fact that “wealth creators” are not mentioned shows that we have made some progress. Ryan is down to defending the rich without any broader justification.

    That should sink in with the rank and file.

  5. john personna says:

    @Markey:

    Heh, at this point does that poll well even withing the broader Republican party?

    This is further dividing-down until the GOP and Rush listeners map 1:1

  6. legion says:

    2. There’s no Social Security reform plan.

    This is your first ‘tell’ that you’re not looking at a serious proposal: it doesn’t even address one of the major criticisms of Obama’s plans.

    3. The plan repeals Obamacare, which is highly unlikely.

    This, however, is the Big Tell. If you can get past this line and still imagine you’re looking at anything even vaguely serious, you’re a f*cking idiot. And yes, I’m looking directly at all the talking heads that will nod and act like this is in any way a worthwhile proposal.

  7. OzarkHillbilly says:

    @grumpy realist:

    Capital Gains should be taxed at the same level as ordinary income. This is called “indifference” by tax planners and if the so-called Free Market geeks really believed in what they preached, they’d yammer for it.

    They don’t believe in it. They know “free markets” have never existed. What they are pushing is just propaganda.

  8. Moosebreath says:

    @legion:

    “The plan repeals Obamacare, which is highly unlikely.

    This, however, is the Big Tell.”

    And yet, Ryan is willing to both keep the taxes imposed by Obamacare and the Medicare cuts imposed by Obamacare, both of which were the centerpiece of the Romney-Ryan campaign on entitlements just last year. And the so-called liberal media will give him a pass on this, and proclaim his proposal serious.

  9. Ed in NJ says:

    Don’t forget not only is Ryan assuming the repeal of Obamacare, but he’s relying on the taxes and Medicare cuts that are included in it to make his numbers add up.

    In other words, it’s a wholly unserious, nonsensical budget proposal, and should be described as such.

  10. Tsar Nicholas says:

    For me items 3 and 4 are perhaps the most egregious. Basing your entire plan on events that are clearly not going to happen isn’t honest in budgeting, it’s pure political theater.

    Bingo!!

    This “plan” by Ryan is total nonsense.

    No. 2 also is very germane and quite important. Discussing our debt and deficit scenarios without Social Security is like discussing spirits without any mention of whiskey.

    Speaking of drunk, the notion that Social Security should be kept off budget is falling down into the gutter absurd. Social Security is the largest unfunded mandate in history.

    Regarding Item No. 1 this Pethokoukis fellow makes a good point, but it misses the elephant in the room. The problem with Medicare is Medicare. The entire system fatally is flawed. It should be sunsetted.

    The answer to No. 5 is a resounding yes. Even if we eliminated DOD, in toto, the federal government still would be too large, too costly, too ineficient and too burdensome.

    No. 6 is such a collection of mixed concepts and loopy thinking it’s surreal. Pethokoukis is conflating the deficit with the national debt. He’s mixing up the two key fiscal ratios. He’s not factoring in debt service. If the government is “growing” via deficit spending it becomes a perpetual cycle. He’s not factoring in the inevitabilties of higher inflation and higher interest rates. Plus we can’t grow our way out of this debt. Theoretically we could grow our way out of the deficit, since Social Security {cough} is “off budget,” but not the debt. The deficit is around $1 trillion. The debt is $16 trillion and growing every nanosecond. We’re not a start-up country that all of a sudden can commence compounding at double-digit growth rates. No chance in hell.

    Overall, back to the primary topic at hand, I’d give Ryan’s plan a F-minus. And that’s probably being generous.

  11. grumpy realist says:

    @Tsar Nicholas: if we’re going to sunset Medicare, let’s not wait around. Dump it immediately. If it’s great to do in the future, it’s great to do it now. (Me, I’m for a universal health care system for those who want it, the rest are on your own and whatever private health insurers decide to use you as kibble. Oh, and if you sign up for the government health care system, they get to do rationing and nag you about eating your veggies. If you don’t like the level of health care you receive, buy your extra insurance on top of it. Problem solved.)

  12. Scott says:

    What I find disheartening the the disconnect between the narrative of the budget and what the budget actually is. It is one big non sequitur starting with the problem statement and ending with the conclusions of what the budget will accomplish. One can’t read it without your head exploding with the total illogical flow of the whole thing.

  13. Tom Hilton says:

    The most striking thing to me about this piece is how (relatively) sane & honest James “Obama is doomed” Pethokoukis can be when there isn’t a presidential election going on.

  14. Jeremy R says:

    On the Ryan budget’s deep medicaid cuts:

    http://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/12/paul-ryans-budget-isnt-about-the-deficit/

    The nonpartisan Kaiser Family Foundation estimates that cuts on the order of what Ryan is proposing will mean around 35 million people lose their health-care coverage.

  15. Console says:

    3 is a disingenuous way of putting it because Obamacare wouldn’t be repealed, it would be half repealed, with all the tax increases and medicare cuts staying.

    4 is the most important one though. It’s all magic. It’s a revenue neutral tax cut. How is it revenue neutral? Because magic, that’s why.

  16. Spartacus says:

    James Pethokoukis wrote:

    6. Why does the budget need to balance in ten years? Debt reduction doesn’t require balance, just that the economy is growing faster than the debt.

    But Doug wrote:

    For me, items 3 and 4 are perhaps the most egregious. Basing your entire plan on events that are clearly not going to happen isn’t honest in budgeting, it’s pure political theater.

    Can someone please explain why it is necessary to balance the budget? People, mostly poor thinkers, have got it in their heads that the U.S. needs to have a balanced budget, but no economist believes this and no non-economist can explain why having a balanced budget is optimal.

  17. Moosebreath says:

    @Spartacus:

    “Can someone please explain why it is necessary to balance the budget?”

    Because Democrats control the White House, and using the deficit as a cudgel is necessary to prevent Democrats from passing any of their programs. When Republicans are in control, as Dick Cheney said, “Deficits don’t matter”.

  18. gVOR08 says:

    I think Booman has a pretty good take on this http://www.boomantribune.com/story/2013/3/12/103636/693 In order to get the Tea Party House members to go along with the last debt ceiling increase, Boehner and Ryan promised they’d propose a budget that balanced in ten years. .

    It is the price sane pays to crazy to not destroy things. But the rest of us in the real world don’t have to take Ryan’s budget plan (much less the Republicans’ stupid ‘American Dream’ talking points in support of his budget plan) seriously in the least. It is a joke, and nothing more.
    People will point out that the numbers don’t add up and that it’s a cruel document and that it’s insane and that it isn’t sound economics and that it relies on gimmicks. True. True. True. True. True. But it’s not even a budget Ryan and Boehner believe in. They aren’t pushing it because they think it’s good policy. I don’t even believe that they think it is good politics. They’re just trying to prevent their own guys from breaking shit.

  19. Moosebreath says:

    A liberal critique of Paul Ryan’s budget — no change from last year’s and the year before’s. It’s as if elections don’t have consequences.

  20. C. Clavin says:

    Boehner today:

    “…We owe it to the American people to balance the federal budget…”

    Well…yeah…because Republicans took a balanced budget and ran it into the largest economic crisis since the Great Depression…so yes…in a just world Republicans would fix what they broke.
    But fixing that doesn’t mean eliminating Medicare as it is currently known, installing a hugely regressive tax system, slashing discretionary funding to levels below what can reasonably be called austere, and throwing more and more tax cuts at the wealthy.
    There is not one thing in Ryan’s budget that can be honestly claimed to create jobs.
    Taxes…We have historically low tax rates. How low do they have to go before jobs are created?
    Austerity…Just yesterday the WSJ pointed out that the UE rate would be lower if we hadn’t trimmed all the Government jobs since the Bush Contraction.
    http://blogs.wsj.com/economics/2013/03/09/number-of-the-week-unemployment-rate-without-government-cuts/
    And they did not even calculate the jobs that NORMALLY WOULD HAVE BEEN ADDED during the same period of time. If they had the damage that Republican driven austerity has caused would have been even more evident.
    http://thepoliticalcarnival.net/wp-content/uploads/2013/02/chart-public-sector-job-loss-presidents.jpg

  21. anjin-san says:

    It’s as if elections don’t have consequences.

    Ryan believed the right wing noise machine when it told him that he & Romney were headed for certain victory. Now he believes it when it says Obama only won by buying votes with taxpayers $$$.

    Clearly, Ryan is not the sharpest knife in the drawer. Yet he passes for an intellectual on the right.

  22. Jenos Idanian #13 says:

    And yet, Ryan’s budget is still more “serious” than Obama’s… but I’m sure he’s working real hard on and Will Not Rest Until he finishes. it.

  23. C. Clavin says:

    @ Jenos Jones…

    Still waiting for my apology.

  24. TheColourfield says:

    @Jenos Idanian #13:

    It may be a pack of lies Dude, but at least it’s an ethos budget

  25. john personna says:

    @Jenos Idanian #13:

    Is there anything more going on here than an empty “he did it too?”

    What exactly makes Obama’s budget less real, less in touch with real economics and spending, than Ryan’s?

  26. Jenos Idanian #13 says:

    @john personna: s there anything more going on here than an empty “he did it too?”

    Actually, the point is that Obama has NOT done it, too. Obama’s budget was due weeks ago, and it’s still nowhere to be seen. And unlike Ryan, he’s legally obligated to submit one.

  27. Jenos Idanian #13 says:

    @C. Clavin: I’m sorry I didn’t notice your Jew-hating assholery sooner. It would have saved me bothering with you on several occasions.

    Feel better?

  28. john personna says:

    @Jenos Idanian #13:

    Nitwit.

    How many Obama budgets have there been? If there was some major cheat in those, you could have named them. It is true that the 2014 budget, note that, 2014 budget isn’t out yet, but you have plenty. And I bet that all you can find in those old ones is that you disagree with their plans, politically. Not economically or numerically.

  29. al-Ameda says:

    Two points:
    (1) Now we do know for certain that no plan is better than this plan, and
    (2). Now that the election is over, Ryan is free to submit Kabuki Budget Plans like this one.

  30. David M says:

    @john personna:

    And I bet that all you can find in those old ones is that you disagree with their plans, politically. Not economically or numerically.

    That’s not how things work for the GOP. The numbers can’t work unless they agree with it politically, in which case the specific numbers don’t matter.

  31. Jenos Idanian #13 says:

    @john personna: Dolt.

    Obama was legally required to submit his budget several weeks ago. (I’m talking about the current budget.) It’s still 404.

    I’d apply the same type of criticism to Obama’s budget as Ryan’s is getting, but it’s still vaporware.

    Please feel free to correct me if there is an Obama budget to look at.

  32. C. Clavin says:

    @ SLT, James, Doug…
    I’m not sure what someone who tosses around such an inflamatory insult…then not only refuses to apologize when multiple commenters point out that it is baseless…but actually escalates the insult…brings to the party.

    https://www.outsidethebeltway.com/north-korea-nullifies-1953-armistice/#comment-1716182

    https://www.outsidethebeltway.com/north-korea-nullifies-1953-armistice/#comment-1716335

    https://www.outsidethebeltway.com/a-conservative-critique-of-paul-ryans-budget/#comment-1716488

  33. David M says:

    @C. Clavin:

    I’m not sure what someone who tosses around such an inflamatory insult…then not only refuses to apologize when multiple commenters point out that it is baseless…but actually escalates the insult…brings to the party.

    He’s a troll. He wants to derail the thread conversations and spout nonsense that makes the GOP look good.

  34. KariQ says:

    Whoa, wait a minute. An AEI member says

    Does nondefense discretionary spending need to be cut further?

    and no one even blinks? Did I miss a change there and they now think that smaller government is not necessarily and automatically better government?

  35. legion says:

    @C. Clavin: It’s true that there is no community that would not be richer for the absence of counterproductive leeches like Jenos…

  36. An Interested Party says:

    He wants to…spout nonsense that makes the GOP look good.

    He would need a bigger bag of tricks and far more smoke and mirrors than that which Ryan is trotting out to reach that result…

  37. Just 'nutha ig'rant cracker says:

    Tax reform is an opportunity for the GOP to show it is the party of parents and kids, not just the party of heroic entrepreneurs and CEOs.

    I take it that James Pethokoukis is new to the conservative movement and the GOP? Rand lives on, but the only place is in the GOP and its sock puppet, the Libertarian Party.

  38. C. Clavin says:

    FYSi…I never expected Jenos to apologize for his hateful baseless insult. To do so would take spine, balls, courage.
    We saw the same thing with the NRA ad and Sidwell Friends and JKB. Confronted with the facts…JKB ignored the facts.
    This is Germaine to this discussion because those two…like Ryan…are the Republican Party.
    They cannot admit they made a mistake, that they are wrong, that they have failed.
    Ryan is parading the same budget he has 3 times before. It has never gone anywhere. Romney ran for President on this budget. And lost by 4%.
    If Ryan had more balls or spine or courage than Jenos or JKB he woul come up with something new…something with a chance…something intended to advance the Nation.
    But alas…there is zero difference between Ryan or Jenos or JKB. They are of a kind…people with no spine and no balls and no courage. And it is proven by their actions…and lack thereof.

  39. Andre Kenji says:

    @Just ‘nutha ig’rant cracker:

    I take it that James Pethokoukis is new to the conservative movement and the GOP?

    He is not. He spent the whole period between 2007 to 2008 asking “Where´s my reccession, dude?”.

  40. Jenos Idanian #13 says:

    @C. Clavin: I’m sure your cutting wit is a big hit at sites like StormFront, but I find it rather lacking.

    And seven down-twinkles for pointing out how Obama STILL hasn’t submitted a budget proposal. Seven down-twinkles for stating a simple fact. I have to wonder — if Obama had actually submitted a budget and I said he hasn’t, would I have gotten more down-twinkles for being wrong?

  41. C. Clavin says:

    Too…think of Bush43…and his infamous inability to think of a single mistake he had made…after 9.11 and invading Iraq. The biggest foreign policy blunder in our history isn’t a mistake in their eyes.
    Cowards. An entire party of cowards.
    Jenos is just another one of the horde.

  42. Jenos Idanian #13 says:

    @C. Clavin: That “what mistakes have you made” was as stupid-ass a question as “could I borrow your baseball bat so I can beat you with it?”

    And your ability to acknowledge that are about as non-existent as Obama’s proposed budget. You know, the one that is more “serious” than Ryan’s, even though it doesn’t actually exist.

  43. C. Clavin says:

    “…“could I borrow your baseball bat so I can beat you with it?…”

    Now physical threats from behind your keyboard?
    @SLT, James, Doug….
    How much do we have to put up with from this cretin?

  44. john personna says:

    @Jenos Idanian #13:

    Stop embarrassing yourself.

    You had a chance to put up, or shut up, with Obama’s 2010 budget. Or his 2011 budget. Or his 2012 budget. Or his 2013 budget.

    So the 2014 budget is still in progress. Big deal. There is a track record there. If you wanted to show “Obama’s budgets are even more smoke and mirrors” you could have done so.

    You have an infantile argument to impress only infants.

  45. wr says:

    @David M: “He’s a troll. He wants to derail the thread conversations and spout nonsense that makes the GOP look good.”

    Actually, he just wants to derail the thread and make himself the center of attention in this, the only place in the world where anyone pays attention to him. He cares as much about the GOP as he does about Jews… or budgets… or anything. Makes it a lot easier always to be contrary when you don’t give a damn about anything.

  46. legion says:

    @Jenos Idanian #13:

    I’m sure your cutting wit is a big hit at sites like StormFront, but I find it rather lacking.

    So when you have nothing substantive, your new tactic is to completely manufacture a nonexistent insult to a third party, take up the Banner of Self-Righteousness, and equate the stater of this totally imagined slur with neo-nazis. Wow. Stay classy, Jenos. I’m sure someone, somewhere thinks you’re not an idiot, but you’re actually more likely to find camaraderie at SF yourself.

  47. john personna says:

    Matthew O’Brien at The Atlantic on the scale of Ryan BS:

    Ryan’s tax cuts would reduce revenue to a very low 15.5 percent of GDP over the next decade, according to the Tax Policy Center. But his revenue target for last year was 18.3 percent of GDP. Ryan said he would make up the difference by killing $5.6 trillion or so in tax breaks that he couldn’t name. That was magical enough. But now he says he wants the same tax cuts and an extra 0.5 percent of GDP in revenue. That’s about a $6.7 trillion hole. And remember, Ryan says his total budget — tax reform and spending cuts — will save $4.6 trillion the next 10 years. In other words, Ryan’s magical savings are 146 percent of his overall savings.

  48. G.A.Phillips says:

    James Pethokoukis ? Never heard of him…

  49. Rob in CT says:

    I was pleasantly surprised by points 3, 4*, 5 and 6. Partiucularly the bits about non-defense discretionary spending and budget balance (debt to GDP ratio reduction yes, balanced budget no).

    Perhaps there is hope for this one. I don’t really know, as I’m not all that familiar with his work (I have a vague negative memory about him, but no longer recall the substance).

    * – though the complaint about bias against capital is silly. It’s the other way ’round.