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The Last Word on the Ryan Budget – A Massively Dishonest Document

This will probably be my last post on the Paul Ryan budget, which you can access here. It’s simply not worth wasting that much space on a budget plan that not only won’t become law, but may not even pass the House. Conservatives are angry that it doesn’t cut enough, and takes too long (beyond 2030) to balance the budget while adding trillions to the federal debt. Establishment Republicans are mostly angry that it makes their party a punching bag for Democratic attacks on its cruelty.

So why even bother with this? Because Ryan did the service of setting out the priorities of his party – in a mild way, if you listen to the hardline House conservatives, in a way that will resonate long into the future. Ryan would deliver $3 trillion in tax breaks to corporations and the wealthy, which he claims will be paid for by “closing loopholes,” though he designates no actual loopholes for closing. He would kick at least 30 million Americans off the health care rolls through the repeal of the Affordable Care Act, and as many as 14 million more by block granting Medicaid and reducing federal participation by over 35% over a decade. Medicare becomes a voucher to purchase coverage, that will inevitably result in cost-shifting from government to seniors. Defense spending increases in the budget, and the trigger of defense cuts gets excised in favor of alternative non-defense spending cuts. So the summation that “Ryan’s budget funds trillions of dollars in tax cuts, defense spending and deficit reduction by cutting deeply into health-care programs and income supports for the poor” is not only accurate, it’s a perfect distillation of the Republican theory of government.

But what leaps out here is the utter dishonesty that Ryan uses to make his case. He says that the block granting of mandatory programs like Medicaid and food stamps would work just like welfare reform.  But welfare reform DIDN’T WORK, and the only way you can claim it worked is by looking at its performance during the largest postwar period of prosperity and economic expansion in American history. The real test requires we take a  gander at welfare’s performance outside of 1996-2000, like during the Great Recession, and you see poverty rates expanding while less Americans qualify for cash assistance.

The tax issue is massively dishonest as well. Ryan basically waved away the $6.2 trillion he would need to capture through limiting or eliminating tax deductions by just mandating that it will happen, without listing one actual deduction he would limit or eliminate. He also didn’t specify the dividing line between his two tax brackets, set at 10% and 25%.

In fact, the entire way the budget was scored by the CBO reflects a good portion of dishonesty. Ryan’s staff delivered a series of assumptions to CBO that they had to use to run the numbers on the budget. In truth, these assumptions are completely crazy:

Medicaid and CHIP (children’s healthcare) would decline from 2% of GDP today to 1% of GDP in 2050, and everything else — that is, everything other than Social Security and Medicare — would decline from 12.5% of GDP today to about 4% of GDP in 2050.

This is, to put it mildly, nuts. Defense spending alone amounts to 4% of GDP, and it’s vanishingly unlikely that this will ever fall much below 2-3% of GDP. This means that all domestic spending will decline from about 8% of GDP to 1-2% of GDP by 2050. That’s prisons, border control, education, the FBI, courts, embassies, the IRS, FEMA, housing, student loans, roads, unemployment insurance, etc. etc. It’s everything. Whacked by about 80% or so.

So Ryan put together an impossible budget with impossible assumptions, then directed CBO to not question the assumptions in any way. Then Ryan points to his self-dictated CBO score as proof for the success of his budget.

Which is why this budget sums up post-Tea Party Republican politics so perfectly. It just operates on a different plane of reality, with its own rules and standards that aren’t applicable to modern-day planet Earth.

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David Dayen

David Dayen