Paul Ryan’s courageous budget is a challenge not only to Democrats to get our collapsing fiscal house in order but also to nervous Republicans.
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These massive tax hikes, if allowed to take effect, would decimate the economy and capital markets — as even many Democrats recognize. It is no surprise that congressional Democrats have been nearly silent in reaction to the Obama budget, reminiscent of the Senate’s 97-0 rejection of the president’s last budget proposal.
The goal of the Ryan budget is to put the nation on a path to reducing our federal deficit and national debt. Over the next decade, it cuts spending by more than $5 trillion compared to Obama’s budget, and offers more than $3 trillion in lower aggregate deficits.
CBO scoring of the Ryan budget “estimates that this budget will balance and begin to produce annual surpluses by 2040, and will start paying down the national debt after that.” It also reduces the share of GDP spent on Medicare, Medicaid, and discretionary spending versus current law. Since the CBO uses “static modeling,” which ignores the pro-growth aspects of reducing taxes and regulation as well as the growth-stifling impact of Obama’s many tax hikes, the beneficial impact of the Ryan budget will likely be greater — and sooner — than CBO estimates.
According to the House Budget Committee, the Obama budget is a “path to a debt-fueled economic crisis and permanent decline,” with our massive debt (now 100% of GDP) “having real effects today” including injecting uncertainty about “the government’s unsustainable future” into the economy. The Committee also notes “clear evidence that stimulus spending did not achieve its promised results” because “it contributed to deficits soaring above $1 trillion a year.”
On our current path and under its extension in the Obama budget, it is a matter of when, not if, we have a financial crisis in the country. This would harm households, business, and government revenue, leading to “painful fiscal adjustments” as we’ve recently seen implemented of Greece, with more to come across Europe’s social welfare states.
Paul Ryan’s “Path to Prosperity” is a bold challenge to the Obama administration, a team that has fewer good economic ideas than any bunch since Herbert Hoover and Messrs. Smoot and Hawley abandoned free-markets and tipped the nation into a Great Depression. When Treasury Secretary Tim Geithner was challenged on the administration’s failure to make even small strides towards dealing with the nation’s fiscal woes, his response was, “We’re not coming before you to say we have a definitive solution to our long-term problem. What we do know is we don’t like yours.” It’s not just in foreign policy that the Obama administration “leads from behind.”
In an interview on CNBC on Tuesday, Gene Sperling, director of the Obama administration’s National Economic Council, went to the usual Democrat well, blaming deficits on the Bush tax cuts (despite data disproving this claim), calling for “shared sacrifice” (because the top 1 percent paying more federal income tax than the bottom 90 percent is not “fair” enough), and suggesting that the Ryan plan would offer “extremely harsh cuts in Medicaid.” (Cue next commercial of Paul Ryan pushing a wheel chair bound grandma off a cliff.) With this sort of thinking, the Obama economic team will, in less than one full term, have presided over a stunning 47 percent increase in the national debt with no end in sight.
In addition to being a bold challenge to President Obama and Senate Democrats, and a solid starting point for national fiscal sanity, the House budget accomplishes other equally valuable tasks: Harking back to James Carville’s “It’s the economy, stupid,” Ryan returns the national political discussion to the key issue of the size, scope, and cost of the government — and how by any measure the nation cannot afford another four years of Barack Obama.
It simultaneously pushes Republican politicians candidates toward solid pro-growth economic plans while giving them political cover to do just that. No longer will Republican candidates be able to look courageous with plans that tinker around the edges, that keep an overly complicated system in place, or that add distortions to favor interest groups.
In that sense, Republican candidates and members of Congress might not like the Ryan budget showing them to be less aggressively pro-growth than they should be. Their reaction to the Ryan plan will be more interesting and instructive than Democrats’ predictable “sky is falling” paroxysms. Initial reactions from some Republicans already show a desperate need for vertebral transplants.
But perhaps the most valuable contribution of Paul Ryan’s budget is to show the nation what leadership looks like. Targeting “political cowardice,” which Ryan names as a key factor in our entitlement programs’ descent into bankruptcy, is too rare an occurrence among congressional leaders, as is stating specific principles on which policy proposals are based and making a moral argument to support them.
The contrast between Paul Ryan’s vision and political courage not only highlights the failures, cynicism, and cowardice of the Obama administration, but also serves as a cautionary reminder that “every country has the government it deserves.” Entitlement thinking has saddled our children with over $15.5 trillion in national debt and $118 trillion in unfunded liabilities. So in addition to forcing politicians into a serious economic discussion, Paul Ryan’s bold proposal compels angry and fearful American voters to take a long hard look in the mirror.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
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Was the President done in by the economy, or by the politics of the economy?
H/T to National Review Online