The House Republicans unveiled their “alternative budget” yesterday, and this time it actually had numbers. Rep. Paul Ryan of Wisconsin, the top Republican on the House budget Committee, rolled out the Republican alternative, which I have attached below. From the New York Times:
The Republican plan, introduced after days of ridicule from Democrats about the absence of an alternative to President Obama’s proposal, would also freeze most domestic spending for five years, increase Pentagon spending, permanently extend the Bush-era tax breaks and eliminate any taxes on successful investments in 2010 as a way to spur the economy. Republicans said they would spend $4.8 trillion less than Democrats over 10 years.
I have not read the entire document as of yet, but one key feature is the projected deficits. The Republican budget projects less of a deficit than the Obama budget, but still contains huge deficit spending. David Bernstein over at the Phoenix has summarized the deficit issue very nicely:
Well, as I quickly read the GOP alternative, they’re jacking up the total debt to a total of $10.8 trillion in five years, and $13.6 trillion in ten years. That may be, as they claim, $3.6 trillion less than Obama’s version at the 10-year mark, but can you really make a big stink out of that difference? Can you really convince the public that one path would demolish the value of the dollar and trigger hyper-inflation, while the slighly-fewer-trillions path is good policy?
Hard to argue that point. The Republicans have been trying to use the deficit issue as a club against Obama and the Democrats. (Rather funny in light of their own deficit record). This budget simply gives that issue up, and will allow the Democrats to counter the deficit argument by citing Ryan’s own numbers. (Maybe the Republicans were better off filing without numbers.)
Other features that can be highlighted now include a five year spending freeze on discretionary spending (exempting veterans services, homeland security and defense), makes the Bush tax cuts permanent, converts Medicaid into a block grant program, and would convert Medicare for those under 55 to something like the plan that Congress enjoys for itself. (I am not sure if privatization is the right word, but it would be a substantial change). It would also eliminate the recently passed stimulus bill.
As I mentioned in my first posting on the Republican budget alternative that had no numbers they have been tormented by Democratic taunts on the budget, and have fallen into a political trap that will create divisions in their own ranks and allow the dems to parry Republican criticisms. Bernstein’s analysis, in my view, hits the nail right on the head. We will now await the Republican fallout on the deficit issue. Has Chairman Steele made any salient comments yet?
Read the David Bernstein piece here.
Read the Ryan Wall Street Journal piece here.
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