It seems that even ardent right-wingers in blogtopia are, perhaps, a bit hesitant to come right out and defend the GOP’s “alternative budget” plan, as presented by Paul D. Ryan on the op-ed page of the Wall Street Journal today. Because, as of this writing, there is quite a lot of buzz going on at Memeorandum over the proposal, but very little of it is coming from conservatives.
Here is a roundup of blogger reaction.
Matthew Yglesias says, if you think this is just the McCain campaign economic plan repackaged, take another look:
… McCain was just calling for a one-year freeze on discretionary spending after which reductions in government outlays would be achieved by magic. Ryan, by contrast, is proposing a five-year freeze.
Basically, you can imagine a school that today is serving a certain number of children and has a certain budget. Well, over the course of five years the population will grow and the number of kids in that school will also increase. But the school won’t get any additional money. Instead, because there’s inflation, the school will actually be getting less money even as it needs to teach more children. And so on across the board for federal programs. If you think that there’s literally nothing in the entire federal budget that’s useful, this may strike you as an appealing idea. Otherwise, April fools!
Josh Marshall, although not spiritually uplifted, is “nonetheless comforted by the fact that the Republicans running things in the House GOP caucus are still as clinically insane as in years past.
… We see today from their House GOP ‘budget’ that their new-found allegiance to fiscal discipline has them lowering the top marginal tax rate to 25% (it’s currently 35%, with the Bush tax cuts), which for anyone who knows anything about the federal budget would pretty much inevitably lead to gargantuan federal deficits and the Treasury exploding probably some time early in the next decade. They manage to still have the deficits coming down by bunch of nonsense hokum about oil rigs and other foolery.
And then there is that chart — ohmygod, that chart:
This graph supposedly compares “Democratic Budgets” and the Republican Alternative based on spending as a percentage of GDP between 1980 and 2080. As you can see, Democratic spending is, as they say, off the charts after about 2060.
Now I think it’s perfectly fine for Paul Ryan and the House Budget Committee’s Republican staff to make whatever crazy assumptions they want about Democratic spending. No one has to take them seriously. But I don’t think they can say that this is “based on CBO’s Long-Term Alternative Fiscal Scenario” unless the CBO has actually done an analysis that runs through 2080. As far as I can tell, the Congressional Budget Office hasn’t done any such analysis. But they have scored the Obama budget through 2019, and it looks like this:
As near as I can tell, Paul Ryan and his staff just took the CBO projections that ended in 2019 and drew a random line, extending upward at about a 45 degree angle, until 2080. There’s no real attempt to make it look scientific.
The Republican leadership is calling this bill “fiscally responsible” — because it cuts corporate taxes and freezes spending (except, of course, for military spending). But, as Ryan Grim points out, they had to play a little game with the numbers and the assumptions behind them in order to make that claim:
The Republican budget blueprint released last week called for “a marginal tax rate for income up to $100,000 of 10 percent and 25 percent for any income thereafter,” which would result in a massive reduction in government revenue and a generous tax break for the wealthy, who currently pay a 35 percent rate.
The Republican plan unveiled today by ranking budget committee Republican Paul Ryan (Wisc.) clears the bar they set for themselves in two ways. First, it sets the 10 percent rate for families making $100,000 or less and for individuals at $50,000, thus more than doubling taxes on individuals making between $50,000 and $100,000 — at least as compared as to the original offer.
But the real way that Republicans offer the tax cut without factoring it into the budget’s revenue is to suggest that Americans won’t actually take advantage of the lower rates. Instead, the GOP budget permanently extends President Bush’s 2001 and 2003 tax cuts. A Republican budget committee aid said that the revenues assumed in the GOP budget are based on the current tax structure that resulted from those cuts.
In other words, Republicans are assuming that given the choice between a higher rate and a lower rate, Americans will choose the higher rate. …
And if that assumption turned out to be wrong?
If taxpayers did decide to pay the lower rate, government revenue would plummet by roughly $300 billion per year, said economist Dean Baker of the liberal-leaning Center for Economic Policy Research.
“It would destroy most federal programs,” Ways and Means Committee Chairman Charlie Rangel (D-N.Y.) told the Huffington Post.
Although Ryan does not say this in his WSJ piece, the GOP budget would actually undo the stimulus package recently passed by Congress:
House Republicans are calling for most of the spending in the economic stimulus package passed in February to be rescinded starting in 2010 as part of their alternative to President Obama’s budget blueprint.
And further down in the same article (remember, this is Fox):
Despite spending reductions, the plan projects permanent deficits exceeding $500 billion into the future, fueled largely by big tax cuts.
“If you like this recession, you’ll love the Republican budget,” Senate Majority Leader Harry Reid said in a written statement. “And if their plan sounds familiar, it’s because it merely repeats the same mistakes of the past eight years — mistakes that have cost millions of Americans their jobs and plunged our nation into the worst economic crisis since the Great Depression.”
Emphasis is mine.
Ryan begins with a misdiagnosis, says Steve Benen, and goes on from there to reveal “a breathtakingly radical worldview“:
Our plan halts the borrow-and-spend philosophy that brought about today’s economic problems, and puts a stop to heaping ever-growing debt on future generations — and it does so by controlling spending, not by raising taxes.
In reality, the “borrow-and-spend philosophy” did not create the crisis, so Ryan’s prescription is automatically based on a misdiagnosis. But even if we put that aside, the alternative budget reflects a political party that embraced a breathtakingly radical worldview.
In a nutshell, Ryan proposes a massive tax cut, totaling, by some estimates, around $4 trillion — on top of the Bush/Cheney cuts, which would remain place. The Republicans plan would voucherize Medicare, and, best of all, impose a five-year spending freeze on non-defense discretionary spending (which is, of course, completely insane).
Kenneth Baer, the OMB communications director, said this morning, “If you expected a GOP alternative to the failed policies of the past that got our country into the worst economic crisis since the Great Depression, then I have two words for you: April Fool’s.”
Based on Ryan’s vision, the stimulus package would be gone. Funding for education, healthcare, the environment, infrastructure, law enforcement, and medical research would all be slashed, while the wealthiest Americans are rewarded with massive new tax cuts.
It’s almost as if Ryan and his Republican colleagues are trying to destroy the economy. As Pat Garofalo recently explained, “The economic stimulus package’s main purpose is to close the GDP gap and jumpstart the economy by spurring spending by households, government and the private sector. A spending freeze would act as an ‘anti-stimulus,’ cutting spending precisely when it’s too low and the economy is moving too slowly.”
Paul Krugman added, “I’m shocked by the total intellectual collapse of the Republican Party in the face of this economic crisis…. I’d really like to see some genuine bipartisanship in America. But that can’t happen until we start having at least somewhat sane partisans.”
And if Paul Ryan is what passes today as a sane partisan, the Republican Party has a long way to go before it can sit at the big kids’ table.
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