Republican Budget Roadmap: Paul Ryan's Budget Plan

Wisconsin's US Representative, Paul Ryan, created a Republican Budget Plan which he refers to as a road map. This article presents my opinion about Paul Ryan's Deficit Reduction Strategy that is part of his Budget plan.

My reference is

http://www.roadmap.republicans.budget.house.gov/plan/#Appendix1

Reducing the large deficit is a difficult challenge. The combination of tax cuts, inflation, and government spending over the past half century has created a debt that's threatening our economy. No plan will satisfy everyone. In fact, this Congress may prove to be the most unpopular Congress in our history.

When times are good, it is easy to follow the people's will; particularly with the demand for lower taxes. But today we have 9.4% unemployment; millions of people working for much lower paychecks; foreclosures still at high levels; millions of people who sent out many resumes and couldn't find a job; millions of people who ran out of unemployment compensation, used up their saving and are on Welfare; cuts in local and federal government budgets creating more unemployment in both the private and public sector; and jobs and corporations leaving the nation for more profits overseas. It will be extremely difficult resolve these economic problems and lower the national debt.

We also have a commission appointed by the President to find the causes of this deep recession.

All this didn't stop Wisconsin's US Representative, Paul Ryan. He created a Republican Budget Plan with the long range goal of eliminating the national debt. I give him credit. Other Congressmen have complained about this or that part of Ryan's road-map, but I haven't seen any other plans out there that have a possibility of being successful.

Not that I like Ryan's plan. It's bitter medicine as the reader will discover while reading this commentary on the plan.

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Unfortunately, Ryan could not rise above petty politics and present his plan. He starts out blaming Democrats and Obama for everything. I'm surprised he didn't blame Obama for the Great Depression. He mentions the unmaintainable fiscal path. But he fails to recognize that both tax cuts and government spending are part of the cause of our current financial crisis.

He mentions the weakening of the economy, but fails to mention the Republican flawed plan to make our nation a nation of services by giving away our leadership in virtually every field. What we don't give away, we look the other way while nations steal it.

Of course, he incorrectly describes the current health reform system. I guess Republicans think if they say something often enough, people will believe it; right or wrong. With health reform, the Republicans have proven it true.

Ryan then summarizes his plan. He advocates using competition as a tool to lower health insurance costs, a more efficient tax code and job training. Unfortunately millions of people who attended job training were shocked to find that even with that job training they were unable to find a job. Job training without job creation is pretty much worthless for these people.

The he talks about dependency on government programs and returns to the theme of a larger and more intrusive government. The Republican tools are large and intrusive too. Tax incentives are big government giving awards to businesses that lean the government's way. A lack of tax incentives could be interpreted as big government penalizing businesses for not leaning the government's way.

Ryan fails to recognize that TARP is using the same successful strategy with auto firms that it used with the financial firms. Either that or he assumes the public is uneducated and gullible.

Ryan incorrectly uses the phrase "government takeover of the energy industry. Again the tax incentives the republicans would offer the energy industry could also be considered a government takeover because the incentive not to move in the government's direction would be taken away.

Ryan claims the public will pay for the spending programs but neglects to mention how the public has paid for the government encouraging and rewarding the exportation of jobs and companies and how the public has paid for business tax incentives.

Ryan criticizes financial reform but has nothing better to offer.He fails to blame the recession for the housing market problems and instead (you guessed it) blames Fannie Mae. But he doesn't blame Fannie Mae for the Great Depression. May be that's because nobody would believe it no matter how often he says it. Reduced pay checks and a big reduction in good paying jobs had a great deal to do with the housing industry collapse.

Ryan digresses to the founders of our nation and tries to say their actions and policies supported the Republican ideology of less big government. He conveniently omitted that fact that Thomas Jefferson complained about President Washington's plan to resolve the financial crisis and economic problems. Jefferson said Washington and Hamilton had expanded the powers of government too much. President George Washington is the Father of our country and Founder of our nation. Alexander Hamilton is the Founding Father of our nation. Hence, the argument that the founders wanted less big government falls apart.

The reader knows Ryan thinks his is a tough plan to sell because the first 26 pages of Ryan's plan desperately attempt to justify the existence of his plan. But unfortunately, the first 26 pages add up to little more than an elaborate attack on the Democrats. I simply call it part of the 2012 campaign.

Finally, on page 27 of 59, Ryan settles down to describing his plan. It just occurred to me that Ryan spent more time attacking the Democrats than describing his plan!

Like most Republicans, Ryan focuses on those people who work and not on those people who need help. Republicans wrap themselves in a security blanket by falsely insisting that those who are not working are lazy. I claim that not doing the proper research to weed out the lazy folk is laziness too. Eliminating Welfare, Medicare and Medicaid instead of removing fraud is an act of laziness.

Congress uses the ability to void internal rules as a lazy way to get bills through. For example, voiding the pay-as-you-go rule when creating a Republican sponsored bill. Or demanding pay-as-you-go for Democratic sponsored bills and then criticizing tax increases which are the only way to pay as you go. Republican never used the pay-as-you-go rule in their tax cutting bills.

Finally on page 47, after Ryan illustrates his contempt against the elderly and the poor via a long term plan to destroy Social Security, Welfare, Medicaid and Medicare; Ryan finally focuses on the most important issues: tax reform, business consumption tax, budget process reform and job training reform. For the productive US worker, this is the most important part of the whole report.

Ryan wants to give tax payers a choice of paying taxes using old tax codes or using the new simplified tax. Whichever you select, you will be stuck with it for ten years. Ryan also describes two different tax rates (page 48) but I see nothing about taxes for those earning over $50000 per year.

Ryan wants to replace the corporate tax with a business consumption tax (8.5 percent on goods and services.) Hmmmm. The details of this are not available but it may result in a nasty surprise for manufacturing centers and the electronics industry: Higher taxes. And here is what I like: There will be no business consumption tax on exports. Instead there will be a business consumption tax on imports.

The lower half of page 48 deals with job training reforms. This deals with job training grants. Ryan also assigns oversight to the Government Accountability Office. What happened to Ryan's opposition to big government?

Finally, on the bottom of page 49, we find the topic "budget process reform." In this section Bryan briefly described a binding cap and discretionary caps. He wants to create a mechanism to automatically slow the growth of Entitlement Programs. He also provides a suspension of spending reductions in tines of war and economic downturn. A tax increase would require a three-fifths vote in Congress. I think a tax decrease and tax incentive should also require a three fifths vote. I also think that an internal rule change should require a three-fifths vote.

In conclusion, Ryan spent too much effort justifying his plan and too little effort explaining in plan. Budget cuts at the local, state and federal level translate into smaller police forces, less road maintenance, less public services, less private and public sector jobs, and possibly less help for those in need. Indeed this is bitter medicine for many of our folks.