By tackling entitlement costs, Paul Ryan asks Americans to choose their nation's future
An editorial by the Chicago Tribune
One year ago, Budget Committee Chairman Paul Ryan risked his neck, and the necks of his fellow Republicans in the U.S. House. Ryan didn't merely offer revolutionary changes intended to keep fast-rising Medicare and Medicaid costs from diminishing America's future. He also challenged citizens who object to reforming currently unsustainable social spending ... that is, spending on them.
Democrats ripped him, and a number of Republicans abandoned him.
This week Ryan returned with Version 2.0 of his long-range federal budget proposal. Like last year's, it's a retort to the budget President Barack Obama has offered for the fiscal year that begins Oct. 1. Ryan's plan, like Obama's, stands zero chance of being enacted as proposed. House Republicans will block Obama's blueprint; Senate Democrats will block Ryan's.
The two plans have not a lot in common. But if you're looking for a quick metric by which to score them, consider how much additional money each would require taxpayers to borrow from China and other lenders: Ryan's plan would sharply cut projected spending and would reform but not raise taxes; over the next decade, federal deficits would grow by a total of $3.1 trillion. Obama's plan, by contrast, would raise taxes on high-income households but also let spending rise higher; over the next decade, federal deficits would grow by $6.4 trillion.
Yes, we appreciate that the concept of trillion — a thousand billions — bends the mind. But the difference between $3.1 trillion and $6.4 trillion is profoundly worth debating. What's opening that gap?
Arguably the most important answer came Monday from the nonpartisan Committee for a Responsible Federal Budget in its even-handed analysis of the Obama plan: While praising some aspects, the group concluded that "it does not include the magnitude of reforms necessary to sufficiently address rapid health care cost growth." What's more, Obama's plan "puts forward no specific ideas on how to strengthen Social Security or otherwise address the costs of our aging population."
The costs of our aging population. As we reported when Obama floated his proposal in mid-February, the future of what Americans call our federal debt is growing bleaker because of those costs: Total expenditures on Medicare, Social Security and the portion of Medicaid that covers seniors' nursing-home expenses will rise from 43 percent of federal spending today to 54 percent in 10 years.
Ryan's new plan isn't an instant fix. Like Version 1.0, it goes easy on defense spending, calls for repealing Obamacare, and leaves Social Security for later.
Ryan's plan also has some holes in it. The nonpartisan deficit hawks at the Concord Coalition praised him for sticking his neck out on health spending and tax reform, but also said he's missing key details and his "assumptions for discretionary spending appear unrealistic, both in the short term and longer term."
What we like is that Ryan, unlike a lot of people in Washington, is willing, at significant political risk, to force the debate on the grim budget decisions that have to be made.
Ryan's plan is more ambitious than the 2010 Simpson-Bowles commission recommendations for debt reduction, although we liked that plan's inclusion of some revenue increases along with spending cuts.
Ryan's tax reform plan, new this year, offers a version of what this page has advocated for most of a year: He would reduce individual rates to two categories, 10 and 25 percent, and sharply curtail tax deductions and credits that tend to help the wealthiest households. This brand of reform — lower rates in exchange for fewer tax expenditures — would simplify the tax code and encourage economic growth, job creation included.
Ryan seeks to let seniors choose between Medicare and subsidized private insurance plans, hold the line on tax hikes, and slowly reduce annual budget deficits to zero.
A year ago, plenty of political pundits said congressional Ryan & Co. would pay a terrible price for speaking frankly about the need to re-engineer entitlement programs so future generations, too, can enjoy them. A year later, Republicans have no shortage of self-inflicted wounds, but frankness about the need to reform Medicare and Medicaid isn't one of them.
Ryan offers Americans a choice: After several years of trillion-dollar deficits, do citizens want to keep borrowing for as long as bond markets will let them grow the national debt? Or do citizens want the U.S. to end its addiction?
We don't applaud every detail of Ryan's bold effort to rescue the United States from its current race to financial ruin. We do, though, applaud him for again taking this political risk. That's what real leaders do.