Latest House-Republican Budget Would Balance Budget in Estimated 10 Years
March 12, 2013
America’s national debt is over $16 trillion. Yet Washington can’t figure out how to cut $85 billion—or just 2% of the federal budget—without resorting to arbitrary, across-the-board cuts. Clearly, the budget process is broken. In four of the past five years, the president has missed his budget deadline. Senate Democrats haven’t passed a budget in over 1,400 days. By refusing to tackle the drivers of the nation’s debt—or simply to write a budget—Washington lurches from crisis to crisis.
House Republicans have a plan to change course. On Tuesday, we’re introducing a budget that balances in 10 years—without raising taxes. How do we do it? We stop spending money the government doesn’t have. Historically, Americans have paid a little less than one-fifth of their income in taxes to the federal government each year. But the government has spent more.
. . . By curbing government’s overreach, our budget will give families the space they need to thrive.
Ryan combines moderate spending cuts with reforms in energy policy, health care, welfare, and taxes. (Read all about it.) He reminds us that Medicare is going bankrupt; the status quo is not an option, because if we do nothing, the program will collapse.
The other side will demagogue this issue. But remember: Anyone who attacks our Medicare proposal without offering a credible alternative is complicit in the program’s demise.
The Wall Street Journal has more on this. “Unless we change course, we will have a debt crisis,” Republicans frankly point out. This story also mentions that repealing Obamacare is an important part of balancing the budget:
The GOP budget says it would accomplish roughly 40% of its $4.6 trillion in spending cuts over 10 years by repealing the White House’s controversial 2010 health-care law. Democrats and President Barack Obama are sure to challenge both Mr. Ryan’s goal and his budget math, since they defend the law as good policy and say it reduces deficits.
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On taxes, Mr. Ryan repeats the GOP goals of overhauling the tax code and creating two tax brackets for individuals, at 10% and 25%. He vows to limit or eliminate tax breaks.
Unlike past efforts, this year’s GOP budget will reach balance within a ten-year period (without raising taxes), a long-sought goal of conservatives. “This budget will return the term ‘balance’ from political slogan to actual fiscal concept,” says Doug Holtz-Eakin . . . .
Ryan, who has said he wants to lay the groundwork for a “down payment on the debt crisis,” will be anxiously watching the president’s response to the GOP budget. “Will he resume attacking Republicans and impugning our motives?” he asked on Fox News Sunday.
- “The National Debt”
- “American Fiscal History, 2009-2011”
- “Tax Revenues 15-20% of GDP, Regardless of Tax Increases or Cuts”
- “‘Fact-checking’ Paul Ryan”
Update (March 13th, 2013): Others weigh in:
- NRO’s Andrew Stiles returns with a small round-up of first reactions to Ryan’s budget, including liberals’ (unfortunately predictable) impugning of conservatives’ motives. Stiles also has a new interview with Ryan, who suspects that voters will like Obamacare even less when they feel the law actually take effect.
- (Actually from yesterday) Hot Air discusses some pros and cons.
What Ryan’s budget does not contain, it should be emphasized, is spending cuts. The difference between Ryan’s balanced budget and Obama’s crippling deficits is this: Ryan proposes that federal spending be allowed to grow at 3.4 percent a year rather than the 5 percent rate it is expected to hit otherwise. That is the most important context for this debate: For a difference of 1.6 percentage points in the growth of federal spending, we get a balanced budget in ten years instead of a headlong rush into a debt crisis on the Greco-Spanish model.
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Critics will say that the Ryan budget is unserious because its enactment would require President Obama to sign off on the repeal of his hallmark legislation as well as swallow entitlement reforms that are inimical to his party’s political interests. But the reality is that the continuation of Obama-scale deficits into the indeterminate future creates a brake on economic growth, certainly in the long term and likely in the present. If Barack Obama wants to hold reform hostage to his own political interests, it is not Paul Ryan and the House Republicans who are unserious.
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.
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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.