In a particularly painful-to-watch moment from The Office, Michael Scott (the hopelessly inept boss played by Steve Carell) must tell an entire class of graduating high-school seniors that he will not be able pay their college tuition — having publicly pledged to do so years earlier in a quixotic fit of benevolence. “I’ve made some empty promises in my life,” Michael confides to the camera. “But hands down that was the most generous.” Needless to say, his classroom confession is poorly received.
In the real world, another (considerably more competent) leader with two first names — Rep. Paul Ryan (R., Wis.) — is in an equally unenviable position. When House Republicans unveil their budget document in the spring, it will include a serious blueprint for getting the skyrocketing federal debt under control, (something conspicuously absent from President Obama’s budget proposal). In order to do that, Ryan must address the primary drivers of the long-term deficit: Medicare, Medicaid, and Social Security (in that order). That means proclaiming that the era of empty promises in Washington is over.
Ryan, the chairman of the House Budget Committee, knows better than anyone that by going after ‘third-rail’ entitlement programs he is “walking into a political buzz saw.” He’s already been there, done that. His “Roadmap for America’s Future” put forward a sensible plan to reign in spending, reform entitlements, and balance the budget over the next several decades. In return, Ryan and any Republican who so much as mentioned the Roadmap were relentlessly and bitterly attacked by the Left. That, however, is merely a taste of the invective Democrats will unleash the minute Ryan unveils his numbers in the spring, at which point Obama’s 2012 reelection campaign will already be well on its way.
“We have a high hill to climb,” Ryan said at a recent press breakfast organized by Americans for Tax Reform. “Yes, we will be demagogued and, yes, we will be giving political weapons to our opponents, but shame on them, is the way I look at it.”
Shame indeed, given the magnitude of the problem, and of the consequences if we fail address it soon. According to the Government Accountability Office, the United States currently has $88.6 trillion in unfunded liabilities. Talk about a generous empty promise. To put that number in perspective, in 2008, before the economic collapse, the GDP of every single country on the planet was $61.4 trillion. Our politicians have literally promised us the world. And then some.
And as long as we continue not to act, that shortfall is growing, to the tune of about $10 trillion each year. As tens of millions of baby boomers enter retirement, entitlement spending is projected to consume 100 percent of tax revenue within the next 30 years, which is why the Congressional Budget Office’s own computer-simulation model shows that, at its current rate, our economy will actually crash in 2037.
That’s the bad news. The worse news is that while the American public seems keenly aware that the country is facing a monumental debt crisis — a recent poll from The Hill found that 95 percent of likely voters believe that reducing the national debt is either very or somewhat important — they are utterly ill-informed as to how to solve it. According to a recent Bloomberg poll, for example, 42 percent of people said that cutting foreign aid would have a “very large” effect on the deficit, while just 19 percent think cutting Medicare would. In reality, foreign aid accounts for about 1 percent of the federal budget, whereas Medicare accounts for 15 percent. Altogether, entitlement spending consumes about 40 percent of the budget (and growing). Military spending is nearly 20 percent. The portion of the budget that congress is currently at odds over — non-defense discretionary spending — is a mere 12 percent.
House Speaker John Boehner (R., Ohio) acknowledged this much in an interview with the Wall Street Journal. “People in Washington assume that Americans understand how big the problem is,” he said. “But most Americans don’t have a clue.” Even self-indentified conservatives don’t seem to get it — only 3 percent favor reforming Social Security and Medicare, according to a recent survey.
Herein lies Ryan’s biggest challenge. Not only must he successfully navigate the political minefield ahead, he’ll need to spearhead a massive educational undertaking to convince a majority of the electorate to accept changes to cherished programs. It’s hard to think of a better man for the job. In fact, Ryan has been doing it for while. In his home district in Wisconsin, he has personally conducted more than 500 “listening sessions,” where he explains in detail the nature of the debt crisis — what’s causing it, how it can be fixed — but mostly just takes questions and hears concerns. On Capitol Hill, he’s been doing the same for members of his own party, particularly freshmen, so that they can go home and make the case to their constituents.
The educational outreach, Republican House aides tell National Review Online, will be fairly straightforward: For example, dispelling the widely held notion that simply eliminating earmarks and cutting out “waste, fraud, and abuse” will solve our fiscal problems, when in fact they are mere drops in an ocean of long-term debt. “To enact bold reforms, you need to have public support,” a Ryan aide says. “The American people have to understand what you’re doing and why you’re doing it.”
In this area Ryan has already had considerable success with freshmen Republicans, many of whom were initially reluctant to embrace entitlement reform until attending one of Ryan’s listening sessions. As one House aide explains, freshmen members only warmed up to serious entitlement reform “once they realized that it’s the only way you’ll ever come close to a balanced budget.”
Just as important, an aide explains, will be stressing Republicans’ proposed reforms “while politically courageous, are actually quite modest in scope.” One thing Ryan always points out whenever he talks about entitlement reform is that meaningful change can be achieved without affecting Americans in or near retirement. Reform isn’t about “cutting” Medicare, it’s about “saving” Medicare. But the timing is critical. It’s imperative that we act soon, because if we wait any longer, we’ll have deep and sudden cuts imposed on everyone the way they were imposed on countries like Greece, and the same programs simply won’t exist for future generations.
“If you’ve already retired or you’re about to retire and you’ve organized your lives around Medicare and Social Security, what we will do is preserve those benefits for you just like they are today and then reform them for future generations so that they can actually rely on them, because they are going bankrupt,” Ryan told Mike Huckabee on Fox News. “If we do it now, we do it on our terms, meaning we don’t change anything for people in and near retirement. But if we wait, if we keep delaying and kicking the can down the road, then it will look like Europe — bitter austerity. Cuts will happen to current seniors, and that’s what we want to avoid.”
It’s certainly not the most palatable case to make in politics, but Republicans sense that this time is different, that they have the momentum on their side to succeed where others — from Ronald Reagan to George W. Bush — have failed. “The political conventional wisdom is if you touch these programs, you die, it’s the third rail,” Ryan says. “I don’t think we’re in a conventional moment.”
Faced with the reality of a $14 trillion national debt and the concrete, physical manifestations in Europe of what will happen if we stay the course, Republicans believe that voters will be receptive to their message of reform. And with members of the president’s bipartisan deficit commission — including its co-chairs, former Clinton chief of staff Erskine Bowles and former senator Alan Simpson (R., Wyo.) — renewing their lobbying efforts to help stave off “the most predictable economic crisis in history,” Republicans are confident that public opinion will come around to their side, if they play their cards right.
“The American people see a president who is on the sidelines, acting very political, telling us the Social Security math is fine, rhetorically acknowledging the problem, but doing nothing” says a GOP aide. “If we’re the ones out there leading, not retreating, I think we win the debate.
“Yes, it’s a gamble on whether the American people can be trusted with the facts. We believe that they can be, and, candidly, the president and some Democrats don’t believe the public is ready for an adult conversation on these issues. They underestimate the intelligence of the American people at their peril.”
In order to capitalize on this perceived advantage, Ryan and his colleagues will, in addition to their educational campaign, pursue a parallel strategy designed to split Democrats along their party’s liberal fault line — to separate the Nancy Pelosis from the Steny Hoyers in the House, the Harry Reids from the Mark Warners and Kent Conrads in the Senate, and generally, the Blue Dog, Reagan Democrats willing to “share the urgency” and work across the aisle, from those who think the debt crisis can easily be solved with tax increases. In short, the serious from the unserious.
“President Obama is going to have to decide: Is he an Erskine Bowles Democrat or a Nancy Pelosi Democrat?” an aide says.
Politically shrewd, yes, but also necessary, given that such bold reform to entitlements will be dead on arrival without genuine bipartisan support. Republicans don’t want a repeat of last year’s health-care negotiations, and will be sure make that contrast earlier and often. Aides say Ryan’s budget will be a “nonpartisan document,” and as a non-binding statement of guiding principles, the perfect vehicle with which to instigate a meaningful debate. “We’re going to stand up and put our names behind a solution,” an aide says. “Obama will have to decide whether he wants to play ball.”
At the end of the day, the task confronting Republican leaders is indeed a daunting one. In addition to educating the public and winning over moderate Democrats, they’ll have their own caucus to contend with, needing to convince skeptical members to embrace meaningful reform, while at the same time tempering the passions of freshmen members who may favor an approach that is unfeasibly aggressive. Not to mention all the eggheads in the bond markets and watchdog agencies they’ll have to win over by making sure their plan stands up to professional scrutiny.
In spite of the challenge, Ryan insists that Republicans will “lead with our chin.” They will no doubt come away bruised and bloodied, but so be it — to do nothing would be morally indefensible. And for Ryan, the father of three young children, the stakes — maintaining the American Dream for future generations — could not be higher.
“The way I look at this, it is our obligation to our constituents, to our fellow countrymen to offer them an alternative vision for our country,” he says. “I don’t know what the outcome of that will be, but I know what side of history I want to be on.”
— Andrew Stiles is a 2011 Franklin Fellow.