The Club for Growth on the Ryan budget

Yesterday, the Club for Growth released a statement saying that the Ryan budget was “on balance, a disappointment to fiscal conservatives.” We applauded the strong pro-growth reforms in the bill, but the reasons for our opposition were twofold:

First, the budget doesn’t balance within 10 years, or for that matter, even 20 years. Our country is currently enduring unsustainable trillion-dollar deficits. We cannot wait until 2040 — the year the Ryan budget balances (page 84) — in order to arrest our ever-growing national debt.

Second, we are opposed to how the budget dismantles the annual sequestration spending cuts enacted into law by last year’s Budget Control Act (also known as the debt-limit deal). As you may recall, the debt deal established annual discretionary spending caps for the next ten years. But the debt deal also required additional cuts (both discretionary and mandatory) because the supercommittee failed. Therefore, for the upcoming year, the real number that needs to be achieved, beyond the spending cap, is $110 billion in cuts in total spending authority. But Ryan’s budget achieves less than that: $19 billion in discretionary cuts and $53 billion in cuts to mandatory authority, of which only $18 billion would be included in budget reconciliation, a fast-track process requiring committees to actually pass implementing legislation.

House leaders know that they are $39 billion short — and thus, are breaking the terms of the BCA — but they overcompensate for this by promising deeper spending cuts in the out years.

In other words, they are kicking the can down the road . . . again. Congress made a solemn promise last year that they would abide by the spending restraints in the Budget Control Act. But already, House Republican leaders are breaking that promise. This is now more than a fiscal problem. It’s a credibility issue. Like we said in our original press release, “It is hard to have confidence that our long-term fiscal challenges will be met responsibly when the same Congress that passed the Budget Control Act wants to ignore it less than one year later.”

By breaking the sequester, House Republicans aren’t just spending an extra $39 billion — they are undoing the entire $1.2 trillion sequestration part of the deal. We know Democrats will be more than happy to go along . . . and that will be the worst possible result.

Republicans need to uphold the promise they made last year and go even further. As a country, we can no longer afford to kick the can. We must act, and we must act now.

Club for Growth is absolutely right. The Ryan budget is miles better than anything from the Democrats or the RINOs in the middle but it does little to cut the deficits now. We should ignore any budget plan that has numbers going out for more than 5 years. I don’t care how many trillion your budget will save us by 2040 or 2050. That is all pie in the sky fantasy. Did our 1920 budget projections include the Great Depression? Did our 1930 budget projections predict the Second World War? Did our budget predictions in 2000 predict the War on Terror or 2008 financial collapse. 30 year budget models are no more real than global warming computer models, even when good people like Ryan make them. Any serious deficit/debt plan will address the deficits with harsh cuts leading to a balanced budget within one to two terms of a president.

This has been my objection. I presume the $5.3 Trillion target is the most Paul Ryan believes he can get, politically. But the truth is that we need more on the order of $15 Trillion in cuts over the next ten years (our deficits have been running on the order of $1.5 Trillion per year) to have any hope of saving the Republic. The only way to do this is to dismantle the entitlement state, starting today. This includes phasing out all welfare and subsidies, phasing out social security, adjusting/phasing out UNFUNDED Federal retirements, and requiring that all Federal retirements be funded as we go, (i.e. every year the govt matches a certain amount which is placed in your account like a 401K or an IRA, when you retire you own what is in that account, nothing more.)

We have been acting as if living within your means is optional.

Forget about projections, as written the Ryan “budget” is a work of fiction - it is quite specific about (politically popular) reduction of tax rates and completely non-specific about the (politically unpopular) tax “reforms” that are supposed to make it “revenue neutral”.

Real world, the almost certain result is *increased* deficits.

At the risk of being tiresome, I’ll say it again:

The only thing more dangerous to the country’s fiscal health than “Tax and spend Democrats” are “Spend but don’t tax Republicans”.

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