By merely doubling the national debt over ten years, instead of tripling it as the president has proposed, Rep. Paul Ryan (R, Wis.) has presented a budget that Democrats say “strains credulity” and is “not a workable plan.” I spoke with Ryan yesterday about the GOP alternative budget. I first noted that his budget does double the national debt. His reply:
“The president has obviously inherited a very bad fiscal situation here. The question is, should we try to tax, borrow and spend our way out of it? And we’re saying no, we don’t want to do any of the three. We don’t want to raise taxes — we want to have pro-growth tax policy, so we’re doing that. We get rid of the stimulus because we don’t think it’s going to work. And we not only control spending, but we cut spending, and we reform entitlements. But it takes a while for those savings to accumulate. And obviously, with all of the boomers entering retirement, the borrowing is going to go up inevitably — because of the massive convergence of boomers going from taxpaying to retiring. So that’s going to go up because of the boomers, no matter what.
The question is, are we getting this problem out of control, and are we going in the right direction or the wrong direction…Our program gets it under control and keeps our government limited. It keeps our taxes low and controls spending. Their program not only doesn’t bother to fix entitlements, but they also create new entitlements. They follow the spending and borrowing with higher taxes, but the taxes don’t even catch up with the spending and borrowing.
Is it realistic to freeze discretionary spending for five years?
Discretionary spending has gotten such huge increases over the last few years that we believe the government is too fat and needs to go on a diet.
As for rescinding $500 billion in stimulus spending after this year:
We substitute the stimulus with pro-growth tax cuts to get economy going — to get private capital back in, to help people rebuild their savings. And we rescind all of this spending that they think is going to grow the economy…The stimulus is supposed to act quickly, but most of the money doesn’t get spent until 2011 and later. So they’re defeating the purpose of the bill anyway, let’s not spend the money in the first place.
On repealing President Obama’s “make work pay” tax rebate after 2009:
Those rebates don’t help stimulate the economy. We tried rebates in 2008 and they failed. The very same economists who argued for them then are now telling us it didn’t work. It didn’t work before, why would we expect it to work this time? We’re substituting those rebates with pro-growth tax policy.