Republican Rep. Paul Ryan was in the news earlier this year after releasing a budget designed to eliminate the deficit and federal debt. Many argued that, though it contained radical changes in Social Security and Medicare as well as draconian budget cuts, it also represented a good-faith effort to make hard choices about the budget. But several new analyses show that not only is the plan incredibly regressive, it fails to actually solve the debt problem. Here's your background on the issue:- Ryan's Plan: "A Roadmap for America's Future" [PDF] was released in January; it promises major changes in social insurance, tax policy, and spending cuts that would cut deficits and gradually eliminate the national debt.
- Tax Policy Center Analysis: However, the respected Tax Policy Center highlighted an important problem [PDF] in these calculations: The expected tax-revenue figures -- approximately 19 percent of GDP -- were assigned arbitrarily. When TPC ran the numbers, they found that Ryan's plan was billions of dollars short and would also result in extraordinary regressive tax policy, with large cuts for the wealthy but tax increases [PDF] for almost everyone else.
- Center on Budget and Policy Priorities Analysis: The CBPP took the TPC analysis and went one step further, looking at the impact on other government programs, noting that the plan "would eliminate traditional Medicare, most of Medicaid, and all of the Children’s Health Insurance Program (CHIP)." It's funding for private Social Security accounts "would leave the program with a deep financial hole."
- The President's Budget: For comparison, here is the Congressional Budget Office's analysis of President Barack Obama's preliminary budget proposal, which, while it does not purport to eliminate the deficit and the debt, it does propose the (barely) feasible goal of lowering the deficit to the point where the national debt is sustainable.
Previous Annotations:
A Year of Stimulus
Deficits and Debt
-- Tim Fernholz
