JONATHAN CHAIT MARCH 15, 2010
Last week, I wrote about the Randian philosophical roots of Paul Ryan's budget roadmap. The fiscal question interests me as well. The rationale for Ryan's rapid elevation to the pantheon of great conservative heroes is that his plan, unlike Obama's, can bring fiscal solvency. Here's the Weekly Standard's Matthew Continetti, possibly Ryan's most tireless advocate:
[Ryan's plan] effectively deals with the long-term fiscal crisis. The Obama budget, by contrast, projects record deficits and rising public debt long into the future.
This, however, is totally untrue. Last week, The Center on Budget and Policy Priorities published a lengthy analysis of Ryan's budget, demolishing its claims of fiscal solvency as well as explicating its radical premises. Ryan has replied, and the Center replied (persuasively) to Ryan. You probably don't want to get into the details of the dispute, most of which revolves around Ryan quibbling with, or simply mischaracterizing, isolated terminology in the CBPP report. Here is the main point: Ryan and the CBPP have only one significant disagreement on the fiscal soundness of his plan. Even if you agree with Ryan on this point, it remains the case that his plan would create a higher deficit than Obama's plan for well more than a decade.
The technical dispute centers on whether Ryan's plan would bring Social Security to solvency, or require nearly $5 trillion in general revenue transfers. The debate hinges on whether the Social Security Actuaries or the Congressional Budget Office have the more trustworthy analysis of his plan, and whether the latter accounts for the cost of Ryan's promise the guarantee against loss the private accounts he'd create.
Put that question aside and simply assume that Ryan is correct. It's still true that his budget savings to Social Security, along with his massive cuts in Medicare, would only begin to take place well into the future. This allows Ryan to promise no changes to anybody over the age of 55. But it also means that his budget cuts would do nothing for the budget anytime soon. What would happen soon is Ryan's massive package of regressive tax cuts. Ryan doesn't really dispute findings by the Tax Policy Center that his tax plan would hemorrhage revenue -- he simply says, "the purpose of the Roadmap is to get spending in line with revenue – not the other way around."
Here is a graphic produced by the Committee For A Responsible Federal Budget. I don't think Ryan would consider it unfair -- he re-published it on his own website. The orange line shows the budget deficit if we keep current policies in place. The red line shows the deficit under Ryan's budget as calculated by CBPP. (The green line, current law, is a fantasy projection of what would happen if we do all sorts of things written into law but that neither party would allow, like letting the middle-class portions of the Bush tax cut expire or imposing draconian cuts on physician reimbursement under Medicare.)
Again, Ryan and the CBPP do disagree on what would happen after about 2023. The don't fundamentally disagree on what would happen beforehand, at least as far as the deficit goes. Ryan doesn't cut the deficit below the current policy baseline for well over a decade. Obama's budget, on the other hand, would reduce the deficit by about a trillion dollars over the next decade compared to current policy. You can argue that it's not enough, but it's better than Ryan does.
The comparative benefit of the Ryan budget is that it imposes draconian cuts to Social Security and Medicare in the distant future, which would bring the budget into balance by 2063. But of course Ryan's conservative fans have repeatedly expressed intense skepticism that the Medicare cuts in Obama's health care plan will actually happen. Never mind that, unlike Ryan's entitlement savings, Obama's budget savings are vastly more modest and have been negotiated with the relevant stakeholders.
Conservatives have sneered at the idea that Obama could compel cuts at such far-off dates at 2018. (Continetti: "We don't know what will happen tomorrow. How can we say with any certainty what will happen 11 to 20 years from now?") But they feel totally comfortable with Ryan's plan to slash taxes now, and they assume that future Congresses will feel compelled to abide by his call to reduce the projected size of Medicare by 75% by 2080.
Ryan's overweening skepticism about Obama's promises of modest levels of medium-term sacrifice, combined his certainty about carrying out his own massive ultra-long-term sacrifices, remind me of a recent interview Ezra Klein conducted with Ryan. Klein asked:
Your bill does much more than this bill. But if Congress can't do what it says it's going to do, what's the point in talking about any of this at all? If none of the policies can be implemented, then we're going bankrupt.
Ryan's reply, in its entirety:
I can't disagree with what you just said.
Does Ryan realize that he conceded either that his criticisms of Obama's health care plan are bunk, or that his own plan is bunk?