If nothing else, the right-wing temper tantrum over Tuesday's "fiscal cliff" agreement is rich with irony. After all, the "crisis" was never really about deficit reduction (which the expiration of the Bush tax cuts would have handled quite nicely) but the very real danger of slashing the national debt too fast and thus triggering an economic downturn in 2013. More pathetic still, the GOP's ersatz deficit hawks on Capitol Hill, always more concerned with shredding the social safety net than stemming the flow of red ink, voted overwhelmingly for Paul Ryan's House Republican budget which would require $6 trillion more in debt ceiling increases over the next decade.
Of course, you'd never know that, given the Republican threats to once again hold the debt ceiling hostage unless President Obama agrees to draconian cuts to non-defense spending. While Senators Toomey, Graham and McCain have all warned they would trigger a U.S. default if steep entitlement cuts are not forthcoming, Oklahoma Rep. Tom Cole insisted that the looming sequestration and debt ceiling deadlines represent "Republican leverage." And as he has for months, House Speaker John Boehner explained what the ransom would cost:
"Any debt limit increase would require cuts and reforms of a greater amount."Leave aside for the moment that Ronald Reagan tripled the national debt (and signed 17 debt limit increases) and George W. Bush nearly doubled it again (while signing seven more). And forget for now that Boehner and his lieutenants Paul Ryan and Eric Cantor along with Senate Minority Leader Mitch McConnell all voted for the budget-busting Bush tax cuts, the wars in Iraq and Afghanistan and the Medicare prescription drug program that continue to fuel federal deficits. Less than a year ago, 228 GOP House members and 41 Republican Senators voted for the Ryan budget and its $6 trillion in new debt.
Even with his draconian budget blueprint that cuts Medicaid by a third, ends Medicare as we know it, adds 48 million people to the ranks of the uninsured and by 2050 would result in ending all non-defense discretionary spending, over the next decade the Ryan budget blessed by 98 percent of Congressional Republicans would unleash torrents of red ink from the U.S. Treasury. Ezra Klein explained how:
The Tax Policy Center looked into the revenue loss associated with House Budget Chairman Paul Ryan's plan to cut the tax code down to two rates of 10 percent and 25 percent. They estimate the changes would raise $31.1 trillion over 10 years, or 15.4 percent of GDP. That's $10 trillion less than the tax code would raise if the Bush tax cuts were allowed to expire, and $4.6 trillion less than it would raise if all of the Bush tax cuts were extended.Continue reading below the fold.
The Republican congressman says he'll "broaden the tax base to maintain revenue...consistent with historical norms of 18 to 19 percent." So let's say Ryan needs to find close-enough deductions and loopholes to hit 18.5 percent of GDP. That means he'd need to close about $6.2 trillion in tax deductions and loopholes over 10 years.
But at no point either before or after he became Mitt Romney's running mate did Paul Ryan have the courage to name a single deduction or loophole he'd close. Paul Krugman called it "Pink Slime Economics." Matthew Yglesias concurred, pointing out in March that Ryan was too cowardly to specify which of the $1 trillion in annual tax expenditures he'd end:
Thirteen pages dedicated to explaining his vision for revenue-neutral tax reform. And even so he manages to not name a single tax deduction that he's planning to eliminate. Home mortgage interest deduction? I dunno. Electric vehicle tax credit? I dunno. Deductibility of state and local income taxes? I dunno.For his part, Paul Ryan repeatedly admitted as much. The House Ways and Means Committee, he said, would "show how they would go about doing this."
But because neither Paul Ryan nor Mitt Romney (who adopted the same dodge for his tax cut windfall for the wealthy) ever said how they would do "this," over the next 10 years the Ryan House budget would add substantially more to the national debt than President Obama's proposed 2013 plan.
As the Center for American Progress explained in March, the Congressional Budget Office (CBO) assessment of the Ryan budget "did not test Rep. Ryan's claims about how his policies would actually affect spending or revenue," but "merely showed what would happen to the debt if his claims were true." In a nutshell, they are not:
But the House budget's entire claim to deficit reduction is built on the foundation of those fantasy revenue levels. Without them, the debt goes up, not down. In fact, with all the House budget's tax cuts properly accounted for, revenue would average just 15.3 percent of GDP from 2013 through 2022, not 18.3 percent. The result: deficits would never drop below 4.4 percent of GDP, and would rise to more than 5 percent of GDP by 2022. The national debt, measured as a share of GDP, would never decline, surpassing 80 percent by 2014, and 90 percent by 2022. By comparison, President Barack Obama's budget proposal, released in February, would stabilize the debt by 2015, and bring it down to 76 percent by 2022.
The result? Republicans in Congress would have to vote repeatedly to raise the debt ceiling.
In April 2011, Speaker Boehner admitted as much to a gathering of Tea Party members in his home state of Ohio:
One of the 25 or so leaders, all from Boehner's district, asked him if Republicans would raise America's $14.3 trillion debt limit.In May 2012, Boehner acknowledged that the Paul Ryan budget almost all Republicans backed would violate "my simple principle of cuts and reforms greater than the debt limit increase":
According to half a dozen attendees interviewed by Reuters, the most powerful Republican in Washington said "yes."
"And we're going to have to raise it again in the future," he added. With the mass retirement of America's Baby Boomers, he explained, it would take 20 years to balance the U.S. budget and 30 years after that to erase the nation's huge fiscal deficit.
"Yeah, the big bad House Republican budget that would just gut everything under the sun, according to my friends across the aisle, would still require a $5 trillion increase in the debt ceiling over the next 10 years. Why? Because of the great big demographic bubble -- baby boomers like me, that are going to retire and continue to retire for the next 20-25 years. It's a big challenge."A challenge, Boehner and his Republican allies now insist, which only applies to President Obama and Democrats.