There is no doubt that Rep Paul Ryan (R-Wis.) is the central figure of the Republican budget proposal on the Hill. Go here to watch, on CSPAN, the budget presser with Ryan and other Republicans. Ryan’s proposal cuts $6 trillion over time and also reforms medicaid while repealing the health care bill passed last year.
Ryan’s argument is pretty clear:
It is an open question whether Ryan will persuade the public that his ideas should be passed. There is a real possibility that the people will demand no changes to Medicare. Should that happen, it is difficult to see a way we halt growth v. GDP. But, if the people–and the voters more importantly–are ok with some reforms, even if those reforms are not necessarily Ryan’s planned cuts, then Ryan will have persuaded the public to more frugality. CNBC interviewed Ryan and asked him some tough questions:
Ryan is serious about the cuts:
His proposal cuts $6 trillion dollars over the next decade by bringing non-security discretionary spending to 2008 levels, reforming Medicare by offering government-subsidized private insurance options and reforming Medicaid through state block grants.
Specifically, Rep. Ryan obtains most savings through four major programs. Over the next decade, his plan would cut Medicaid by $735 billion, Medicare by $389 billion, non-security discretionary spending by $923 billion, and health care spending $1.4 trillion by repealing health care reform.
He says his plan brings government spending to 20% GDP by 2015. (Last year, spending was 23.8% GDP.) Rep. Ryan’s proposal also reduces revenue by $1.8 trillion over the next ten years by reforming the tax code and capping tax rates at 25%.
So will the people be persuaded? Ryan’s argument goes beyond the numbers. He is making a moral argument. In a speech at AEI, Ryan said:
At stake is America.
If the debt poses an existential threat to all we hold dear-if we truly believe that our current path leads to a debt-fueled economic crisis and to the demise of America’s exceptional promise-then let’s dispense with the trivialities. Let’s confront the nation’s most urgent fiscal and economic challenges. And let’s chart the path to a brighter future, restoring America’s promise, and ensuring real security through real reform.
The Path to Prosperity is the budget we are putting forward today. It is not just a budget-it is a cause. It represents our choice for America’s future, and our commitment to the American people.
We aim to restore the dynamism that has defined America over the generations, unleashing the genius of America’s workers-investors-and entrepreneurs and strengthening the foundations of economic growth and job creation now and in the future.
We reject a culture of complacency and offer reforms that promote initiative by rewarding effort.
We disavow the idea of unlimited and unrestrained government. Instead, we call for a government limited to its core constitutional functions and faithful to its noble mission to secure life, liberty and the pursuit of happiness for all.
Now more than ever, it is vitally important that we act.
The government’s unfunded liabilities-promises the government makes to current workers about their health and retirement security for which it has no means to pay-are projected to grow by tens of trillions of dollars in the coming years.
Every year that Congress fails to act, the U.S. government gets closer to breaking promises to current retirees, while adding to a large and growing stack of empty promises made to future generations.
Ryan’s budget presents to the people a real choice. Which path will the people choose?