Ryan’s Proposal: More of What Got Us Here in the First Place

October 10, 2013 at 9:19 am

While some in the media are portraying Paul Ryan’s op-ed in yesterday’s Wall Street Journal as a breakthrough that offers hope of ending the impasse over the government shutdown and debt limit, it is nothing of the sort.

The column is heavy on PR and spin; parsing the first part of it requires separating inaccuracies from half-truths.  Particularly noteworthy is the opening, which labels President Obama as the culprit.  “He’s refusing to talk,” Ryan laments.

Actually, Obama reiterated Tuesday that he’s ready to talk and that everything — including health care — can be up for discussion, but the government needs to reopen first and everyone needs to back off the threat of default.  So, the issue isn’t whether to talk, which all sides seem to want to do.  The issue is whether to talk while one side holds federal programs and the nation’s credit rating hostage, threatening to keep the government shut and let the nation default if it doesn’t get its way.

A walk down memory lane may put Chairman Ryan’s complaint about Obama’s refusal to talk in its proper perspective.

In September, Obama made a big concession to Republicans to avoid a government shutdown by agreeing to accept, in its entirety, the sequestration funding level that Republicans wanted for their Continuing Resolution to keep the government open after October 1.  Tuesday, he offered another, saying talks could proceed even if Republicans opened the government and raised the debt limit only temporarily (such as for a few weeks).

That would enable Republicans once again to threaten shutdown and default in a few weeks if the talks didn’t produce an outcome they liked.  Nevertheless, House Speaker John Boehner immediately rejected the offer.

Meanwhile, after insisting that the Senate pass a budget resolution, House Republicans have refused to proceed to a budget conference with the Senate for the past six months after the Senate did as they asked.  Before that, it was Boehner, egged on by hard-liners in his caucus, who walked out of — and terminated — the Obama-Boehner budget negotiations of last December, even though the two sides weren’t far apart.

That clarifies what Ryan means when he says Obama is refusing to talk.  He and House Republican leaders evidently want to negotiate only while they are holding a government shutdown and prospects of a default over the President’s head to gain leverage in the talks.

Beyond that, the policy formulation that Ryan presents in his op-ed is deeply cynical.  It calls for an agreement — on Republican terms.  Here, too, a bit of history will provide useful context.

Hoping to re-start the failed negotiations of December, Obama proposed in his fiscal year 2014 budget several controversial cuts in major entitlement programs that most Republicans favor and many Democrats oppose — such as the “chained Consumer Price Index” in calculating annual cost-of-living adjustments for Social Security and other benefit programs, increases in Medicare premiums for more affluent beneficiaries, and some increases in the Medicare cost-sharing charges that beneficiaries bear.  Obama explicitly offered these proposals as part of a larger budget deal through which Republicans would agree to increased revenues that policymakers would generate by curbing some tax credits, deductions, and credits that are collectively known as “tax expenditures” (and which former Federal Reserve chairman Alan Greenspan has appropriately termed “tax entitlements”).

Before House Republicans pulled the plug on the December negotiations, Boehner had tentatively agreed to more tax expenditures savings alongside entitlement changes.  But, in his op-ed, Ryan now proposes to pocket the entitlement savings that Obama offered as an overture, with no revenues in return.  He also disingenuously cites the Bipartisan Policy Center and the Committee for a Responsible Federal Budget as supporting these entitlement changes without noting that both institutions have supported them as part of larger deficit reduction packages that also raise substantial revenues.

So, here’s Ryan’s offer:  negotiations while the government is shut down and default looms, and an agreement in which all deficit reduction comes from budget cuts and none from increased revenues.

Progress?  Hardly.  It’s the very type of posture that has put us on the narrow ledge on which the nation now finds itself.

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More About Robert Greenstein

Robert Greenstein

Greenstein is the founder and President of the Center on Budget and Policy Priorities. You can follow him on Twitter @GreensteinCBPP.

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