Yes I am fascinated with Rep. Paul Ryan. Here is his interview over at the Wall Street Journal. He talks about a bunch of different things. Items that I found interesting:
1) Yes he is a budget “hawk”, but a “pro-growth” budget hawk. What that means is he will stomach deficits and the tax cuts that feed deficits because he believes the economy will be dragged by increasing taxes. While he attempts to make a distinction between tax cuts and other “spending” that has budgetary impacts I think he did a poor job of it. Republicans say that you cannot compare tax cuts with spending (such as on unemployment benefits), and he is critical of the “new spending” and what he calls demand side stimulus contained in the bipartisan agreement, which he supports. But he never directly deals with how the tax cuts impact the deficit, simply saying that growth, plus spending cuts and entitlement reform will get us where we need to go.
2) He apparently does not believe, as Krauthammer does, that the bill will provide stimulus. He calls it a sugar high, with a short term jolt that will dissipate. Back to the WSJ mantra that cutting marginal tax rates is what produces economic growth, and hence his support for keeping the Bush tax rates in place.
3) He did not rule out a revenue component to deficit cutting, but insisted that it be part of a tax simplification process that will reduce rates and eliminate deductions. On this score he seemed at least sympathetic to the goals of the Deficit Commission.
4) He defended his vote no vote on the Bowles-Simpson deficit reduction plan by saying that they had punted on health care, which is a huge driver of federal spending. On that score he agrees with Paul Krugman, who attacked the Commission report from the left in part by making the same point.
5) As part of his Roadmap he touted two items. The first is the conversion of Medicaid to a federal block grant program. (Medicaid is the federal- state health care program for the poor) The second would be major changes in Medicare, including what he calls “premium support” that would turn the program into a “voucher” system, with private health plans competing for business from the seniors with these vouchers. The key point here is that the system would not even come close to providing federal dollars to match current rate of Medicare spending. Bottom line is that while it would achieve cost control over the program by simply limiting federal “premium support” increases, spending on health care for seniors would drop dramatically. And I do mean dramatically. Ryan, along with Democrat Alice Rivlin, has submitted the Rivlin-Ryan plan on Medicaid and Medicare. That necessarily must be another post, because it represents the true heart of this deficit debate.