Congressman Ryan’s Budget Restrains Spending Growth, Allows Private Sector to Expand Faster than Burden of Government

The Chairman of the House Budget Committee has produced a new budget plan which contrasts very favorably with the tax-heavy, big-spending proposal submitted by the President last month.

Perhaps most important, Congressman Ryan’s plan restrains spending growth, allowing the private sector to grow faster than the burden of government, thus satisfying Mitchell’s Golden Rule so that spending falls as a share of GDP.

The most important detail in the proposal is that the federal budget, which currently consumes 24 percent of GDP, would fall to less than 20 percent of GDP beginning in 2016.

That’s the good news. There are three pieces of not-so-good news.

1. Ryan’s plan allows spending to grow by an average of 3.1 percent annually over the next 10 years, with is faster than the 2.8 percent average annual growth in last year’s budget.

2. His proposed Medicare reform, while far better than current law, also is not as good as what was proposed last year.

3. The federal budget would still consume a greater share of the economy’s output than it did when Bill Clinton left office.

I suppose it’s also worth mentioning that Ryan’s proposal isn’t as good as Rand Paul’s budget. Spending only climbs 2.2 percent yearly under the plan put together by the Kentucky Senator, and he also abolishes several useless cabinet-level departments.

But the very good shouldn’t be the enemy of the good. As noted already, Congressman Ryan’s plan meets the most important test, which is restraining spending so that the federal budget grows slower than the private economy. And, as the chart shows, he obviously imposes more fiscal restrain then President Obama.

Regular readers know that I generally show no mercy to jelly-spined Republicans, but I praised GOPers for approving last year’s Ryan budget. The same will be true if they approve this year’s version.

P.S. I am frustrated and nauseated by all the people who are fixating on whether Congressman Ryan’s plan balances the budget in 10 years, 20 years, or whenever. What matters is shrinking the burden of government. I hereby bestow the Bob Dole Award on all the people who are mistakenly focusing on the symptom of red ink rather than the underlying disease of bloated government.

P.P.S. I’m happy to report that there is no value-added tax in the revenue portion of Congressman Ryan’s budget. There is a VAT in his Roadmap plan, and I endlessly worry that this poison pill will re-emerge and ruin other good fiscal plans put forth by the Wisconsin lawmaker.

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Ways & Means Committee Republicans Achieve the Dubious Honor of Winning the First Bob Dole Award

I confess to being monotonous and repetitive when it comes to explaining that America’s fiscal problem is too much spending, and that debt and deficits are simply symptoms of that underlying problem of excessive government.

But no matter how often I repeat myself, the message isn’t sinking in – even among people who should know better.

That’s why I’ve created the “Bob Dole Award.” I’m hoping that a bit of well-intentioned moral suasion may convince people (at least the ones who presumably are on the right side) to be a bit more careful with their rhetoric.

The first winner of this (hopefully uncoveted) award are the Republicans of the House Ways & Means Committee.

These are the GOPers with the most influence over both tax and entitlement policy, so it’s very important that they understand the real problem and properly communicate with the outside world.

Unfortunately, even though the Committee normally produces good material, they messed up last week when sending out information about Obama’s big-spending budget proposal.

They issued a press release entitled “More than twice the debt in half the time,” and the document (also pasted to the right) accurately shows how red ink has exploded during the Obama years.

But a statist organization, left-wing lobby, or some other pro-big government entity could put out exactly the same press release and make it part of an argument for higher taxes.

After all, most leftists don’t openly admit that they want higher taxes to make government bigger. They always hide behind the fig leaf of “deficit reduction.” Needless to say, any additional revenue almost always is used to expand the burden of government spending.

I’m not sure whether the Bob Dole Award should be accompanied by a “shame on you” or a “tsk, tsk,” but the Ways & Means Republicans deserve a slap on the wrist (or kick in the rear, depending on your disciplinary style).

Correction: A Democrat friend emailed to point out that there was a factual error (as opposed to an error of judgment) in the GOP press release. And it’s one I should have noticed since I made the same point back in 2009, which is that the FY2009 budget began on October 1, 2008 and should be blamed on President Bush.

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Announcing the “Bob Dole Award” for Misguided Conservatives

I’m getting very frustrated. I  spend too much time reminding my supposed allies that America’s fiscal problem is too much government. Deficits and debt, I constantly explain, are best understood as symptoms, whereas a bloated public sector is the underlying disease.

Even people who are very solid on fiscal policy make the mistake of sometimes focusing too much on red ink rather than the size of government, including Senator Jim DeMint, Mark Steyn of National Review, Representative Paul Ryan, and my old friends at the Heritage Foundation.

So I’ve decided to create a new award. But unlike my other awards, which are exercises in narcissism (Mitchell’s Law, Mitchell’s Golden Rule), I’m naming this award after former Senator Bob Dole.

The message is very simple. Whenever people complain about red ink, even if they are genuine advocates of small government, they give leftists an opportunity to say that higher taxes are a solution.

That’s bad politics and bad policy. And since Bob Dole excelled in both those ways, you can understand why his name is linked to the award.

Naming the award after Bob Dole also is appropriate since he was never a sincere advocate of limited government. The Kansas lawmaker was a career politician who said in his farewell speech that his three greatest achievements were a) creating the food stamp program, b) increasing payroll taxes, and c) imposing the Americans with Disabilities Act (no wonder I wanted Clinton to win in 1996).

For all of these reasons, and more, no real conservative should want to win an award linked to Bob Dole.

So I’m putting the policy world on notice. If you say the wrong thing – even if your heart is in the right place, you may win this booby prize.

This video has further information on why the real fiscal problem is excessive government spending. Deficits also are bad, the video explains, but they are best understood as a bad consequence of big government (with high taxes being the other bad consequence).

One last point, for those who are still fixated on red ink, is that nations that do the right thing on spending also tend to be the ones who reduce deficits and debt.

Not that this should come as a surprise. The best way to get rid of symptoms is to cure the disease that causes them.

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