Deficit Reduction and the Next Budget Battle
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| Eric & Paul give Bill & Ted a run for their money |
I am loath to tread in Paul Krugman's footsteps. Especially given that I just watched Peter Beinart lead a Q&A with him on Wednesday. But I choose to write about Congress, and this week the most interesting thing coming out of the legislature is going to continue to be House Budget Chairman Paul Ryan's proposal for 2012 and the decade beyond. Ryan, and Majority Leader Eric Cantor are about to embark on what they believe will be an Excellent Adventure in deficit cutting. They're calling it a Path to Prosperity. But I, like Krugman, fear they're going to be leading us all on a Bogus Journey.
Krugman's work in economics won him a Nobel Prize. And my work in economics is a shoo in for a Booby Prize. So when he says Ryan's budget plan is "a strange combination of cruelty and insanely wishful thinking," there's not a lot I can add to that. But that's never stopped me before.
Like it or not, Republicans -- Ryan and Cantor in particular with their positions of leadership in the House -- are setting the agenda for future budget negotiations. Even as they struggled with President Obama over how much government should spend in the next five months they were laying the groundwork for the next big budget battle, which entails cutting the deficit. And as nasty and protracted as cutting a few dollars here and there was recently, watching a Republican House tangle with the White House over how to reduce the deficit in the long term is going to be nastier and drag out even longer. And however cruel its logic and however wishful its thinking, the Budget Chair's plan represents the opening salvos in what will be a prolonged fight. It's the starting point for the negotiations; and how much, or how little of it remains when the dust has settled remains an open question.
Ryan's Path to Prosperity has no chance of surviving the rumble that's about to go down in one piece for a myriad of reasons, not the least of which is that it cuts funding for the Obama's health care reform law. The Budget Committee Chairman knows his proposal will never make it to the president's desk. And if he were under any delusions about it making through the Senate intact, never in Paul Ryan's wildest dreams would Obama sign it as is. And he doesn't care.
"It really doesn't matter to me" if his approach is adopted and signed into law, Ryan said on NBC's Meet the Press. "What matters to me is that we try to fix the problem."
I take that as an explicit admission of the true goals of the Republican Party when it comes to the economy. Reducing the deficit and cutting America's debts would be fine. And if that's your stated preference, other folks are less likely to discover your true position. Because the important thing, what Ryan and the Republicans hope will result from his plan, is a rightward shift in budget policy, which is already pretty far right of the center.
Obama will unveil his plan for cutting the deficit this week, and it goes without saying that we'll wind up with something between what Ryan proposed and what the President plans on suggesting. I recently made an attempt to argue that Obama ought to engage in some issue uptake with respect to Ryan's emphasis on entitlement reform. It was my hope that if he took the lead on that issue he might be remembered as the President who saved Social Security from bankruptcy and from Republicans who wanted to hand it over to their fat cat buddies in private enterprise.
I was apparently unconvincing. So rather than trying to defend the argument that the President should address Medicare, Medicaid and Social Security reform in his deficit cutting plan, I'll simply predict that he will do so. But I'm not yet willing to stick out my neck on whether he'll be successful at saving any of them, either from financial ruin or from the GOP vultures.
