Rep. Paul Ryan of Wisconsin, along with his Republican colleagues on the House Budget Committee, rolled out a FY 2012 Budget Resolution Tuesday, stressing that it took a “different course” than President Obama’s proposed budget. The tag line for the plan could best be summed up by Rep. Diane Black of Tennessee when she said, “We lead where the president has failed.”
In the Path to Prosperity, Ryan calls for a $6.2 trillion cut in federal spending and a reduction in the deficit by $4.4 trillion over the next decade when compared to Obama’s proposal.
“The president’s proposed budget is worse than just a commitment to the status quo,” said Ryan at a press briefing on Capitol Hill. “The president actually accelerates our descent into a debt crisis … Our budget charts a different course. It is very different from what the president has offered.”
Warning of economic collapse and a future national debt at “catastrophic levels,” Ryan went on to lay out a budget plan that is heavy on spending cuts but, like Obama’s proposal, light on entitlement reform.
Among other things, the Path to Prosperity proposes a 10 percent reduction in the federal workforce coupled with a “true” pay freeze for the next five years. It also calls for reforms to government worker’s benefit programs.
The plan also calls for an end to corporate welfare, tax reform, the repeal of the health-care law and the Dodd-Frank bill, and taking Fannie Mae and Freddie Mac “off the backs of taxpayers.” It does not propose major reforms to the big three of Social Security, Medicare and Medicaid, nor does it cut any significant amount from defense spending.
Ryan, who chairs the Budget Committee, sought to lessen fears about entitlement reform by affirming the need for a strong “social safety net.”
“We ought to have a strong social safety net,” said Ryan. “The problem is, our social safety net is fraying at the seams.”
The Path to Prosperity, however, offers no changes to Social Security. Instead, it calls for the parties to work together and come up with a bipartisan solution to the social program that is currently hemorrhaging funds.
And while the plan would repeal Obama’s health-care law, Medicare is largely left intact for current senior citizens. “Let me repeat,” Rep Tom Price of Georgia said during the briefing, “no changes are made that would affect those in or near retirement.” The plan does include reforms so future recipients can choose from a range of guaranteed coverage options.
On Medicaid, the plan looks at changing the financing structure from a “one-size-fits-all approach” to block grants that allow governors and state legislatures to have more flexibility in tailoring Medicare to fits the needs of their respective state.
But the focus of the Path to Prosperity is debt, spending and economic growth. Ryan told an anecdote of Congressional Budget Office (CBO) computer models of future economic simulation actually crashing at 2037. “Because according to the CBO, they can’t conceive of a time in which the economy can continue past that moment because of this burden of debt,” said Ryan.
“One of my worst experiences I’ve ever had in Congress was the 2008 financial crash,” continued Ryan. “That caught us by surprise … and out of that resulted really ugly legislation – TARP. […] But let me ask anybody who is listening this: What if your congressman, your president, saw it coming?”
“Or more importantly,” he added, “what if they knew what could be done to prevent it from happening and if they had time to prevent it, but they decided not to because it wasn’t good politics. That’s where we’re at right now. This is the most predictable economic crisis in our history.”
When asked about how the Path to Prosperity fits into the current budget debate over the next Continuing Resolution (CR), Ryan said he didn’t know if today’s rollout would help the negotiations.
He did reiterate: “We don’t want a government shutdown.”
UPDATE: The Obama Administration responded Tuesday afternoon to Rep. Paul Ryan’s budget proposal for FY 2012, praising its ultimate goal, but criticizing the approach. “Any plan to reduce our deficit must reflect the American values of fairness and shared sacrifice,” said the statement released by White House Press Secretary Jay Carney. “Congressman Ryan’s plan fails this test.”
“It cuts taxes for millionaires and special interests while placing a greater burden on seniors who depend on Medicare or live in nursing homes, families struggling with a child who has serious disabilities, workers who have lost their health care coverage, and students and their families who rely on Pell grant,” the statement continued. “The President believes there is a more balanced way to put America on a path to prosperity. ”