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Fiscal policy: What is Paul Ryan doing? | The Economist

Written By: democracyamerica - Mar• 15•13

PAUL RYAN has released a budget proposal. That’s what Paul Ryan does. The nagging question is why. His latest is much like his last, except that the new plan, which Mr Ryan has dubbed “The Path to Prosperity”, proposes to balance the budget even faster than he previously proposed to do. (Ezra Klein offers a concise overview of the plan’s main outlines with an illustrative companion chart.) If you’ve noticed that Paul Ryan is not actually vice-president, and that the Republicans do not actually command a majority in the Senate, releasing such a budget may seem a vexing and quixotic exercise. “To take Ryan seriously”, writes Eugene Robinson of the Washington Post, “is to believe that legislation repealing the landmark Affordable Care Act would be approved by the Senate, with its Democratic majority, and signed by Obama. What are the odds?” Long.

Even conservative commentators sympathetic to Mr Ryan’s earlier fiscal blueprints are put off. Ross Douthat, a right-leaning New York Times columnist, observes that Mr Ryan easily could have improved on his earlier efforts, but instead has delivered “a document that’s arguably more unrealistic than the previous versions of the Ryan budget, and that does little or nothing to bridge the gap between the Congressional GOP and the electorate that just re-elected Barack Obama.”

So what’s the point? According to Mr Douthat:

…many conservative House Republicans plainly feel like they’ve already been forced to compromise repeatedly of late — on questions like the fiscal cliff, the debt ceiling, and so on — and so they want their official budget to take a more absolutist stand. Hence the quest for ten-year balance, and the promise of pain on every front except (of course) marginal tax rates.

But what’s gained by taking such an “absolutist” stand? Do House Republicans really want to make a show of adopting the same Medicare cuts that Mitt Romney and Mr Ryan so vigourously opposed just a few months ago? Do they really want to get behind what Mr Douthat has called “a weird, all-pain version of Obamanomics — in which, for instance, we keep the president’s tax increases and Medicare cuts while eliminating his health care law’s assistance to the uninsured”?

Ezra Klein thinks the details of Mr Ryan’s budget are really beside the point, and I suspect he’s right.

It turns Medicare into a voucher program, turns Medicaid, food stamps, and a host of other programs for the poor into block grants managed by the states, shrinks the federal role on priorities like infrastructure and education to a tiny fraction of its current level, and envisions an entirely new tax code that will do much less to encourage home buying and health insurance.

Ryan’s budget is intended to do nothing less than fundamentally transform the relationship between Americans and their government. That, and not deficit reduction, is its real point, as it has been Ryan’s real point throughout his career.

According to Mr Klein, Mr Ryan’s method is to overstate the dangers of fiscal imbalance and then present his ideological vision of government as the only way out, even when plenty of piecemeal stopgap reforms are available to head off budgetary doom. Mr Klein writes:

It is Ryan’s unusual ideology, and not the specific state of our finances, that justifies this budget. Ryan’s view is that the federal government is strangling our community. When the federal government provides health care for the poor and the middle class, it muscles out states, communities and families that might otherwise fill some of the gap. When bureaucrats set up Obamacare’s exchanges, they stifle the essential ingenuity of the private sector. When government does too much to provide for individuals, they are robbed of the bracing necessity of providing for themselves.

I don’t find this ideology so “unusual”. Though I wouldn’t say the federal government “strangles” community, I agree that federal programmes do tend to crowd out state efforts. I daresay even Mr Klein agrees. For American progressives, the point of centralised federal control is so often to ensure that states considered backward in one way or another are not allowed to offer programmes deemed insufficient by enlightened technocrats. And there’s definitely much to be said on behalf of this point of view. Just think of the horrors that would no doubt obtain in Mississippi to this very day had Mississippi been left free to govern itself wholly free of federal meddling. That’s why conservative proposals for devolving power to the states still carry with them a whiff of Jim Crow. And that’s why liberal proposals for strengthening federal power still smack of Harvardian colonial crusades to civilise the humid boondocks.

Don’t expensive federal guarantees make community and family charity both less necessary and less affordable? Hasn’t the increasingly intense and comprehensive regulation of the health-care sector made free markets in insurance and medical services basically illegal? I’m not so sure it’s unusual to think so. At any rate, it’s correct to think so. Mr Klein simply believes that, all things considered, we’re better off with the relatively centralised status quo than we would be if we made a significant move toward free-market federalism. Maybe he’s right about that. But it’s not weird to think he’s not.

I don’t think Mr Klein is entirely wrong when he goes on to say that Mr Ryan’s “ideas are not, on their own, popular. In fact, they’re deeply unpopular, and considered quite radical”. But if these ideas are so deeply unpopular, what does Mr Ryan and his House colleagues gain by repeatedly airing them? What are Mr Ryan and friends up to? It seems to me that either Mr Ryan is an idiot, or he’s negotiating more or less rationally on two separate but intimately related fronts.

On the front of immediate fiscal politics, Mr Ryan’s budget “plan” is best seen as an elliptical statement about the future allocation of the GOP’s bargaining power. It says that House Republicans are happy to concede Mr Obama’s Medicare cuts, will seek to stymie at every turn the implementation of Obamacare, are going to fight like hell against further tax increases, and intend to demand a budget plan that balances the books sooner rather than later. The more fanciful the proposal, the stronger the commitment not to give ground to the White House.

On the front of big-picture public opinion, I hazard that Mr Ryan seeks to make his vision of government seem decreasingly radical and increasingly reasonable simply by repeating it. You can think of Mr Ryan’s fantasy budget as a gambit in a diffuse cultural negotiation over the bounds of reasonable opinion in the ongoing negotiation over fiscal policy—a sort of ideological meta-negotiation. You may think that proclaiming the same “radical”, “deeply unpopular” ideas again and again and yet again can’t possibly make them more palatable and mainstream, but there’s a queer phenomenon psychologists call the “mere exposure effect” that suggests otherwise.

Mr Klein argues that Mr Ryan has discovered that the way to get a hearing for his unpopular ideas is to present them as if they are “necessary, prudent measures to forestall an even more dramatic debt crisis”. But why would a politician, ever at the mercy of popular support, dare to rehearse the same widely detested ideas at maximum volume every chance he gets? Because repetition makes the heart grow fonder?

I’m not saying Paul Ryan’s playing 11-dimensional chess here. I’m saying that either Paul Ryan and his House colleagues, blinded by ideology, are wreaking havoc on their party’s prospects, or they aren’t, and they’re not. I can’t tell which it is.

(Photo credit: AFP)

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Fiscal policy: What is Paul Ryan doing? | The Economist

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