In the kingdom of the blind, according to Erasmus, the one-eyed man is king. And in a land of big spenders, the budget proposed yesterday by Representative Paul Ryan is a model of fiscal rectitude.
Let’s be honest about one thing: The budget introduced yesterday has about as much chance of becoming law as Nancy Pelosi does of being elected pope.
And of course Ryan’s budget relies on a veritable garden’s worth of rosy assumptions in order to reach balance, including the repeal of Obamacare and GDP growth of slightly more than 3 percent. Either or both could happen, but I wouldn’t bet the farm on it.
But at least it is a budget. It has now been more than four years since the Senate produced such a document. While Senate Democrats have pledged to do so this year, recent reports suggest that they are struggling to come up with a plan that can garner support from a majority of their members. Meanwhile, President Obama now says that he may not send a budget plan up to the Hill until the middle of April, despite the fact that the Congressional Budget Act of 1974 requires it to be delivered to Congress no later than the first Monday of February. Give Ryan points, then, for at least doing his job.
More important, the Ryan budget provides a view of Republican priorities and their vision for how to increase economic growth, reform entitlements, and balance the budget. While timid and imperfect, Ryan’s plan shows that Republicans are at least looking in the right direction.
Ryan accepts the $600 billion in tax increases resulting from the fiscal-cliff deal, but rejects any new tax hikes going forward. It also includes pro-growth tax reform — lowering rates while broadening the base.
On the spending side, Ryan would mostly retain the sequester, and would further reduce spending by $5.7 trillion from the current ten-year baseline, bringing the budget into balance by 2023.
However, while we can undoubtedly look forward to news stories about how Ryan would slash spending, his budget doesn’t actually cut spending at all; it merely slows the rate of growth. Indeed, under Ryan’s proposal, federal spending would still grow by an average of 3.4 percent every year. By 2023, we would be spending $1.4 trillion more than we do today. Indeed, spending under Ryan’s budget never drops below 19 percent of GDP, a higher proportion of the economy than it was under Bill Clinton.
Michael D. Tanner is a senior fellow at the Cato Institute, heading research into a variety of domestic policies with particular emphasis on health care reform, welfare policy, and Social Security. His most recent white paper, "Bad Medicine: A Guide to the Real Costs and Consequences of the New Health Care Law," provides a detailed examination of the Patient Protection and Affordable Care Act (Obamacare) and what it means to taxpayers, workers, physicians, and patients.
NEW TIME Today, at 9:30 AM PT: Get the Market Movements in Advance: William's Edge Webinar for November 21st, 2014 | John Ransom
NEW TIME Today, at 9:30 AM PT: Get the Market Movements in Advance; Williams Edge Webinar for November 19th, 2014 | John Ransom
NEW TIME Today, at 9:30 AM PT: Get the Market Movements in Advance; Williams Edge Webinar for November 17th, 2014 | John Ransom