A Firm Step Forward
The Bipartisan Budget Act reduces the deficit and doesn’t raise taxes — that’s a start.
By Paul Ryan
Yesterday, Senator Patty Murray and I introduced the Bipartisan Budget Act of 2013. It’s the first budget agreement of its kind since 1986, and I’m proud to support it. This bill will reduce the deficit by $23 billion. It won’t raise taxes. And it will cut spending in a smarter way. It doesn’t go as far as I’d like. But it’s a firm step in the right direction.
First, let’s remember how we got here: In 2011, President Obama signed into law the Budget Control Act. The law tasked a twelve-member “supercommittee” with cutting at least $1.2 trillion from the federal deficit. And to spur them to action, the law essentially made a threat: If the committee couldn’t come to an agreement, the law would order arbitrary, across-the-board cuts — known as the sequester — to get those savings. It would make half of the cuts in defense programs and the other half in domestic programs. In other words, the alternative to an agreement would be so painful that the supercommittee would just have to reach one.
Unfortunately, the committee couldn’t come to an agreement. And this year, the sequester took effect. Now, House Republicans wanted to keep these savings. In fact, we wanted to save more. But we didn’t think our troops should bear the brunt of these cuts. The Defense Department warned it would have to shrink our armed forces and make serious cuts to training, readiness, and modernization. Members of both parties quickly realized there was a better way to cut spending.
When Senator Murray and I started these negotiations, we agreed on some ground rules. We knew if we tried to force each other to violate one of our core principles, we’d never get anywhere. I wasn’t going to raise taxes. She wasn’t going to change major entitlements.
Instead, we looked for common ground. There was some overlap between the budget she proposed in the Senate and the budget I proposed in the House. We knew we wouldn’t resolve all our differences. So we found some commonsense ideas both parties could support.
Here’s what we came up with: The Bipartisan Budget Act will provide $63 billion in sequester relief — split evenly between defense programs and other domestic priorities — in exchange for $85 billion in savings elsewhere in the budget. In other words, this bill will reduce the deficit by an additional $23 billion, without raising taxes. And most important, it will cut spending in a smarter way.
How do we cut spending? First, we eliminate waste. We stop paying Medicaid bills that dead-beat dads should cover. That alone is a $1.4 billion cut. We stop sending unemployment checks to criminals. And we stop sending government checks to dead people. There’s no reason to tolerate fraud.
Second, we cut corporate welfare. For instance, we repeal a government research program for private energy companies. A profitable industry shouldn’t rely on taxpayers to pay for its research.
Third, we make real reforms to the real problem: autopilot spending. The federal government makes trillions of dollars in empty promises to retirees. And these empty promises don’t only drive the national debt; they threaten these retirees’ security. We don’t solve all these problems, but we make a good start: We make sensible reforms to federal-employee and military-retirement programs.
We ask new federal employees to contribute a little bit more to their retirement, so taxpayers don’t have to pick up the full tab. And for younger military retirees, we trim their cost-of-living adjustments just a bit. It’s a modest reform for working-age military retirees, many of whom have second careers after leaving the armed forces.
Finally, we don’t think taxpayers should have to bail out private companies’ pension benefits. So we ask these companies to cover more of the cost of guaranteeing their benefits. That will protect taxpayers and save $7.9 billion.
These are real cuts that will become law immediately. If we pass this bill, we’ll eliminate waste — right now. We’ll cut corporate welfare — right now. And new government employees will start paying a fairer share. These savings will build up over time. But they will be even greater than what we’d save by doing nothing. That’s why this is a good deal.
We haven’t squandered the gains from the Budget Control Act. We build on them. Our agreement preserves 92 percent of the sequester cuts — even though Democrats wanted none of them. We don’t get rid of this fiscal discipline — we get more and do so in a smarter way.
Now, I’ll be the first to admit that this bill doesn’t solve the problem. I’ve passed three budgets in the House, all three of which would have fully paid off our debt without raising taxes. This bill doesn’t go nearly far enough. But in divided government, you don’t get everything you want. You have to work with the other side. And when you get the chance to take a step forward — however small — you take it.
Here’s what we’ve accomplished: We’ve cut spending in a smarter way. And we’ve made it clear: Tax hikes aren’t an option. We’ve said budget talks should be about how Washington can live within its means, not how families should pay more. For conservatives, this agreement shows we can make Washington work — and on our own terms. It’s not perfect. But it’s a start. And I ask all my colleagues in the House to support it.
— Paul Ryan (R., Wis.) is chairman of the House Budget Committee.