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Redstate...
Ryan’s Budget: A
Conservative View - The Excellent, the Good, and the Need for
Improvement
Posted by dhorowitz3
Tuesday, April 5th
Republicans should build upon Ryan’s diligence to end Democrats’
profligate socialism and expose them for the true extremists that they
are.
The moment we have been anticipating has finally arrived. House
Budget Committee Chairman has released his budget for FY 2012, along
with his blueprint for tax and entitlement reform over the next
decade. This budget proposal, which would cut $5.8 trillion from
the CBO baseline over the next decade, is a mature and well balanced
plan emanating from a city full of fatuous demagoguery.
It is important to note that this is just the preliminary proposal of
the very first step of the congressional budget process; the Concurrent
Budget Resolution. There will be ample time to sort through all
of the components of this plan and provide the appropriate changes as
needed. Nonetheless, it is a laudable first step that has come to
fruition through the assiduous work of Paul Ryan and his Republican
colleagues on the Budget Committee. It is a fresh breath of
moderation and seriousness amidst the extremism that is so endemic in
Washington among the Democrats. Here is a cursory breakdown of
some of the major provisions of the Ryan plan, categorized by the
excellent, the good, and the need for improvement.
The Excellent
Medicaid: The budget proposes a transformational change to Medicaid by
converting it to a block grant program which would give states more
flexibility in how to spend their Medicaid dollars. There would
also be an overall cap placed on the block grants. This would
encourage states to innovate and formulate the best ideas for reducing
dependency, instead of exacerbating it through an open ended
entitlement program. The plan would trim the cost of Medicaid by
$771 billion from the CBO baseline over the next decade.
Corporate Welfare/Ethanol/Farm Subsidies: Ryan’s proposal repeals the
odious ethanol subsidies lock, stock and barrel. It also reforms
farm subsidies by trimming farm/corporate welfare from its current
level of $25 billion. This is especially prescient given the
record high food prices that have been spurred in part by these
market-distorting subsidies. To address the record high energy
prices, the proposal calls for an end to tax cuts for the rich - no
more green subsidies!
Obamacare: It defunds Obamacare lock, stock and barrel. While
much of the budget is driven by choices between several evils in order
to reform existing Democrat entitlement programs, this proposal
prevents ObamaCare from becoming another Medicare/Medicaid disaster.
Taxes: The proposal reduces the highest corporate and personal income
tax rates to 25%.
Earmarks: The ban on earmarks is made permanent.
Freddie Mac and Fannie Mae: The budget plan cancels these
economic destructive government entities and calls for their
privatization. The resolution also calls for an end to corporate
bailouts that were enshrined in the Dodd-Frank financial takeover bill.
Pell Grants: All of the exorbitant increases in Pell Grants that
were a part of the stimulus bill would be defunded. This will
help slow rising tuition inflation that has been generated as a result
of these interventionist programs.
The Good
Medicare: Ryan proposes a premium-support program to replace the
current market-distorting, bankrupting, and open-ended subsidization of
all health care for seniors. Under such a plan, the government
would pay the premiums of Medicare enrollees’ so they can purchase an
insurance plan of their choice in the free market. As with the
Medicaid proposal, this plan would mandate an overall spending cap on
the amount of the premium payments.
While this plan is a prudential first step to infusing the free market
into an otherwise socialized sector of the economy, the changes will
not take effect for another 10 years. Also, a more conservative
approach would have called for the issuance of vouchers, thereby
directly empowering the individual, as opposed to perpetuating the role
of government through their payments to insurance companies. In
addition, the plan calls for adjustable spending caps that can lead to
means-testing based upon the needs of the individual. Those who
contribute more into Medicare shouldn’t receive less because of their
personal income status. The individual’s contribution to Medicare
and Social Security is what sets apart those programs from welfare
programs. As such, they should not be means tested.
Nonetheless, Ryan’s Medicare plan is a decisive step in the right
direction.
Welfare Reform: Ryan proposes converting the Food Stamp program into a
block grant to states that would be indexed to inflation and tailor
made to each state’s own unique circumstances. He also wants to
apply the 1996 welfare reform accountability mechanisms to other
housing assistance programs. There are currently a staggering 44
million Americans on food stamps and the program is projected to cost
$700 billion over the next 10 years. Ryan’s reforms offer a very
good first step.
On the other hand, there are still over 70 other welfare programs that
cost another trillion dollars, but are untouched in this
proposal. Republicans should look to Jim Jordan’s Welfare Reform
Act of 2011 to build upon Ryan’s reforms of the Food Stamp
program. [Read more about Jordan’s plan here.]
Need for Improvement
Social Security: The most glaring omission of Ryan’s budget plan is a
fix to Social Security. It is understandable why Ryan would shy
away from touching the most sacrosanct program in the federal arsenal,
especially as he is bravely striking out at virtually all of the other
major programs. However it must be reformed.
Many good conservatives are so concerned about solvency that they are
calling for a raise in the retirement age and means-testing of
benefits. While those proposals might succeed in making SS more
solvent, they are an anathema to the ideals of free market capitalism
and individual liberty. It is inconceivable that a hard working
30 year-old should be forced to work until 70 (maybe longer) and then
awarded his retirement at the whims of a means-tested regime, all the
while having no property rights over his retirement security.
The objective of entitlement reform is not to make a Democrat-run
program solvent. Our objective vis-à-vis entitlement reform
should be focused on returning the wealth to the American worker and
taxpayer by promoting more liberty and prosperity. It is fair to
propose much needed innovative changes such as benefit cuts and
retirement age adjustments for those who optionally enroll in such a
program. However, there can be no discussion of raising the
retirement age without offering young workers private accounts or an
option to opt out.
Taxes: Repeal Death Tax- One of the more egregious components of the
grand tax deal last year was the reinstating of the immoral Death Tax
at 35%. The Death Tax needs to be abolished. Period.
Non-defense discretionary spending: The proposal only cuts $1.7
trillion from domestic discretionary programs over 10 years. That
adds up to roughly $170 billion in discretionary spending cuts per
year. This is accomplished by bringing non-security discretionary
spending back below 2008 levels and then freezing it for five
years.
Spending levels for most agencies should be reduced to 2006
levels. Furthermore, Republicans should take a closer look at
Rand Paul’s proposal to cut up to $500 billion a year by eliminating
such impotent departments as HUD, Education, and Energy. His plan
would also seriously reduce the funding, size, and scope of the
Departments of Agriculture, Commerce, HHS, Interior, and Labor.
Keep in mind that when we fund these agencies, we are not merely losing
the billions or tens of billions of dollars in wasted
expenditures. These superfluous agencies use that funding to
impose onerous market-distorting regulations and mandates on job
creation, income growth, energy productivity, and consumer purchasing
power. Such a cost to our economy is incalculable.
Debt and Deficit: Due in part to the previous point, the proposal would
take too long to balance the budget. For FY 2012, the government
would spend $3.529 trillion and collect $2.533 trillion, still
resulting in a gargantuan deficit of $995 billion. It would take
another 26 years to fully balance the budget.
Conclusion
The Democrats have worked indefatigably for a century to destroy the
fabric of our free market, liberty seeking society. We will not
restore our republic overnight. As such, Paul Ryan’s proposal
provides us with the building blocks from which to bring about the
restoration of our constitutional government. More importantly,
it has spurred a much needed sagacious debate about the best way to
fulfill those ideals-a debate that has been suppressed by the Democrat
extremists in Washington.
The Democrats can no longer hide the fact that they have no desire to
cut one red-cent from their sacrosanct $3.8 trillion annual plunder of
the American worker and their $14.2 trillion foreclosure on the next
generation. They will fight vociferously to keep every last
poverty inducing, market-distorting, and price-hiking program.
After all, the future dependency and impending poverty of the American
worker is the mother’s milk of Democrats’ perennial power.
Republicans should stick to their guns and build upon Ryan’s
innovations. A new poll shows that Americans align with the Tea
Party against Congress on all major issues by a 48%-22% margin.
There is nothing to fear, as the Tea Party agenda is good politics, and
more importantly, good policy. Quite the contrary, it is the
Democrats who should fear electoral reprisal. Their extremist
policies have killed jobs; reduced income, raised the cost of food,
energy, and vital needs; perpetuated poverty and corporate cronyism;
depredated our energy productivity; and spawned a virtually immutable
debt crisis.
Paul Ryan’s budget resolution is the starting point for our efforts to
reverse all of these statist ills. The only question from here is
how quickly we desire to return to a path of prosperity and individual
freedom.
Read it with links at Redstate
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