Last week, when I talked about ideological bubbles and how to tell if you're in one, I should have mentioned the best single technique for staying out of bubbles in the first place: Expose yourself to as many original sources as you can, especially the ones you know you're going to hate.
With that in mind, I read Paul Ryan's budget yesterday. In telling you about it, I'm going to try to keep my commentary as close to the text as possible, with quotes and page references as appropriate. (I wish I had the time to do an end-to-end annotation, but I've got some big deadlines looming.)
If you think you can stand it, follow me past the squiggle.
General impressions. Before I get into specifics, I want to say a few things about the overall impression the document makes
As many people have already observed, Ryan's proposal is not an attempt to reach a workable compromise with the White House or the Democratic majority in the Senate, both of which would have to agree before his plan could become law. Instead, it's an aspirational document for conservatives: This is what they fantasize about doing if and when they get complete control of the government.
There's nothing wrong with that, but there's also no reason to take it any more seriously than an aspirational budgets from the Left, like People's Budget put out by the Congressional Progressive Caucus. Both are shots across the bow, not plausible projections of what the country will do in FY2014 and beyond.
The write-up is a rallying cry for the troops of the conservative movement, not an attempt to convince or convert the non-believers. The summary (page 7) says "It invites President Obama and Senate Democrats to commit to the same common-sense goal [of a balanced budget in ten years]" but there is no spirit-of-invitation in Ryan's style. Any liberal who reads it will get pissed off, and I believe that's intentional. Conservatives couldn't fully enjoy their reading experience without visualizing pissed-off liberals.
Let me detail that: You've probably already heard that Ryan wants (once again) to try to repeal the Affordable Care Act (a.k.a. ObamaCare). But after the first mention, he can't just call the law by name, or even nickname. It's "the President's onerous health care law" (page 33) or "the President's misguided health care law" (page 40) and so on, as if the ACA had been imposed on the country by imperial decree and Congress had nothing to say about it -- also as if the ACA hadn't been an issue in the 2012 election that Romney/Ryan lost by nearly five million votes.
Other partisan stuff is just silly. On page 24, President Reagan is given credit both for the economic expansion of his era, and of President Clinton's era as well. Clinton is mentioned exactly once, on page 33, when Ryan re-raises the universally debunked lie from campaign 2012 that Obama wants to rescind the work requirement of Clinton's welfare reform. The reader would never know that Ryan's stated goal -- a balanced budget -- was achieved by Clinton while Reagan ran up record deficits.
You will also hear echoes of 2009's Lie of the Year: death panels. The ACA sets up an Independent Payment Advisory Board (IPAB) to make annual recommendations on keeping Medicare spending within specified limits. The law specifically bans the IPAB from recommending care-rationing, but the heading of the Ryan's section on it (page 40) is "Repeal the health-care rationing board".
Background assumptions. In the real world, if a program is important enough, the government could conceivably raise taxes or borrow to pay for it. OK, Ryan's balanced-budget goal won't let him advocate borrowing. But a fundamental assumption that runs through his whole budget -- usually without being stated explicitly -- is that taxes cannot be raised for any purpose. Nothing is important enough to raise taxes to pay for.
Also, defense spending is untouchable. "There is no foreseeable ‘peace dividend’ on our horizon." (page 61)
So if the domestic demands on government are growing -- the population is getting older, the infrastructure more decrepit, healthcare more expensive, weather-related disasters more extreme and more frequent, future economic growth more dependent basic research and an educated workforce etc. -- any money you want to spend to deal with one of those challenges has to be taken from the others.
The idea that over the long term our country could decide that it wants to do more of its consumption publicly -- that it wants to take economic growth in the form of Medicare and public education, say, rather than BMWs -- that's completely off the table.
Big Picture. The numbers don't appear until the Appendix (page 80). Atlantic's Derek Thompson put the ten-year cut totals into a bar graph and a pie chart.
Social Security: $0
Medicare: $129 billion
Discretionary: $249 billion
Interest: $700 billion
Medicaid/other health: $756 billion
Mandatory spending: $962 billion
Obamacare: $1.837 trillion
Medicare and Social Security are usually considered "mandatory spending" (because benefits are defined by law rather than by appropriation), but I believe the additional $962 billion of 10-year savings is Food Stamps, Pell grants, and a variety of other people-helping programs.
So the cuts are almost entirely in healthcare, education, or anti-poverty spending.
Meanwhile, rich people get a big bonanza: The top tax rate drops from the current 39.6% to 25%. If you make $10 million some year (some CEOs do), that could save you nearly $1.5 million.
It's also worthwhile to consider what isn't in the budget document.
- Any specifics about discretionary spending cuts. The cuts are just numbers on a spreadsheet. All the "tough choices" necessary to achieve those numbers are left to your imagination, so Ryan can deny any intention to cut anything in particular, as Mitt Romney did in his first debate with President Obama.
- Any specifics about closing tax loopholes. Ryan claims his rich-guys-bonanza 25% tax rate wouldn't cut federal revenue, because it would be balanced by eliminating tax loopholes. As in the 2012 campaign, Ryan says nothing about what those loopholes might be. Again, he can deny wanting to cut any specific item, like the mortgage interest deduction. But he's got to raise that revenue somehow, and I seriously doubt it's all going to come from the super-rich who benefit most from the lower rate.
- Any plan for Social Security. Page 37 charges: "In Social Security, government’s refusal to deal with demographic realities has endangered the solvency of this critical program." But rather than "deal with demographic realities" here and now, Ryan only "requires the President and Congress to work together to forge a solution."
For example, on page 20 Ryan identifies "tuition inflation" as a problem that "plung[es] students and their families into unaffordable levels of debt". And then he says:
Many economists, including Ohio University’s Richard Vedder*, argue that the structure of the federal government’s aid programs don’t simply chase higher tuition costs, but are in fact a key driver of those costs.What could that possibly mean? Well, that federal aid is allowing too many people to go to college, creating a high-demand environment in which colleges can raise tuition. So the "solution" is to lower the maximum Pell grant (thereby "saving" the Pell grant program from spending at an "unsustainable" level, since we couldn't possibly raise taxes to pay for it). Also to "target aid to the truly needy" by making families report more of their income on financial aid forms. Also "reforming" student loans and "re-examining the data made available to students to make certain they are armed with information that will assist them in making their postsecondary decisions".
Presumably, when the facts of this harsher you're-on-your-own world are spelled out to students, fewer of them will decide to go to college, thereby saving both their money and the government's. So don't worry about student debt -- just don't go to college at all if you're not rich, and if you do go we'll "help" you avoid massive debts by refusing to loan you money.
Oh, and we'll also "encourage innovation" through "nontraditional models like online coursework". Never mind that's where the big scams are. Corporations profit from those scams, so that's not "waste".
Ditto for job training: Ryan promises to "extend opportunity" by spending less on it.
Ditto for the safety net. Since taxes can't possibly be raised, every person who is helped by the safety net is taking those dollars away from somebody else who might be helped. So Ryan's "A Safety Net Strengthened" section is all about spending less on the safety net. Mostly this is accomplished by block-granting programs like Medicaid to give "states more flexibility to tailor programs to their people’s needs."
So if, say, low-income Texans need to toughen up and stop seeing a doctor at all, Texas can tailor its program that way. That's what it's doing already with the "flexibility" the Supreme Court gave it last summer.
Energy. Climate change just isn't happening. Ryan doesn't say that in so many words, but there's a big empty spot where that idea would be.
He clumps energy together with a grab-bag of other issues in the "Fairness Restored" section. The "unfairness" in this case is the way that the Obama administration favors clean energy over dirty energy. Ryan will "end kickbacks to favored industries" like wind and solar in favor of "reliable, low-cost energy" like coal, oil, and gas. With climate change out of the picture, only corruption can explain Obama's favoritism. In his Introduction -- signed "Paul" -- Ryan says his budget "restores fair play to the marketplace by ending cronyism."
In current energy policy, fossil fuels and green energy are subsidized in different ways: Green energy gets grants and loans while established-and-profitable fossil energy gets tax breaks. Tax breaks are invisible to Ryan, so he can say on page 50:
on a dollar-per-unit-of-production basis, the level of subsidies received by the wind and solar industries were almost 100 times greater than those for conventional energyDo it for the kids. So what's the purpose of all this? A better world for our children. "By living beyond our means, we're stealing from the next generation." (page 5)
Of course you know how that works, because all that debt America ran up during World War II was "stolen" from us, right?
Or maybe you didn't notice, because in the real America, the big deficits of World War II kicked off half a century of prosperity, during which the country achieved a level of equality that it hasn't equalled before or since. So no, deficits are not "stolen" from the future. We're not building landing crafts and putting them in time machines to send them back to D-Day.
But in order to save our children from the horrible maybe-sorta-problem of the national debt, we need to under-educate them; not do basic research that might create the next Internet; leave them crumbling roads, bridges, and electrical grids; not care for them when they get sick; move in with them when we get old; and leave them with a torched planet, where Iowa is a desert and Miami is underwater.
I'm sure they'll thank us for our foresight.
* As best I can tell, although Ryan identifies only their university affiliations, every economist Ryan mentions by name is inside the conservative bubble. Richard Vedder is with the American Enterprise Institute and John Taylor with the Hoover Institute.