Star Tribune editorialists went out of their way Monday morning to praise Wisconsin Congressman Paul Ryan’s entitlement-privatization budget — or rather, the readers who didn’t scream about it.
The expected fear and loathing was in short supply. Instead, many of those commenting seemed relieved that someone, somewhere, was proposing something that might actually work: a plan that would stem the nation’s red-ink spending and balance its books.(Ryan’s plan would take a while — until 2080 — to achieve that goal, but it does get there eventually.)
In this case, fear and loathing may be wise. While the Strib acknowledged Ryan’s budget is too cut-heavy, editorialists ignored more fundamental questions about the deficit-closing benefit.
On Wednesday, the Center on Budget and Policy Priorities released an analysis contending that under Ryan’s proposal, the deficit would soar, rather than sink.
Though CPBB criticizes Ryan’s regressive spending cuts (such as slicing Medicare outlays 76 percent in real terms by 2080), the deficit problem is on the revenue side. The Congressional Budget Office, which produced the zero-by-2080 estimate, did not look at money coming in, instead accepting Ryan’s revenue assumptions. The CBO’s report noted that with multiple caveats, even if the Strib’s editorial didn’t.
CBPP, which swings from the left side of the plate, didn’t take Ryan’s revenue claim at face value, asking another D.C. institution, the Tax Policy Center, to analyze the income side of the ledger. The TPC concluded — stop me if you’ve heard this before — that large tax cuts would cause federal revenues to fall significantly (3 percent of Gross Domestic Product) below Ryan’s assumption. You can see the net effect in the chart at right.
Budget geeks should check out the CBPP’s report, Ryan’s response, and the CBPP’s rebuttal here.
I agree with the Strib that folks are longing for a realistic deficit-reducing solution, but rather than Ryan being “one of the rare politicians who believes that Americans are ready to handle the truth,” he may be just another politician selling a unicorn — or worse, a Trojan Horse that would shred the social safety net and balloon the deficit. We’ve seen the revenue-side games before, which you’d think would argue for skepticism, no matter how contrarian the plan.
If we truly want to close the deficit, we’ll probably have to cut spending and raise taxes. That’s not as sexy as Ryan’s headline-grabber, but, as the Strib might say, it might actually work.