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Home Publications Op-Eds & Columns Representative Ryan's Valuable Service

Representative Ryan's Valuable Service

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Dean Baker
TPMCafé, April 5, 2011

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I want to join those in commending Representative Paul Ryan, but for a slightly different reason. Representative Ryan has provided a valuable service to the country by tossing out a piece of warmed-over dreck that calls for a massive upward redistribution from the nation's workers to the rich. This is clear to anyone who reads it.

For example, the 73-page outline makes no reference to the recession caused by the collapse of the housing bubble. Is it possible that Representative Ryan has not noticed all the people in his district in Wisconsin and elsewhere who have lost their jobs or did he just choose not to mention the recession for political reasons? Certainly anyone who was really concerned about deficits would note that the large deficits of 2008 forward were caused by this collapse.

Ryan also proposes major cuts to Medicaid that will likely make it far more difficult for Medicaid recipients to get care. Then he promises that his plan will remove the stigma Medicaid beneficiaries face (page 41). This may be true in the sense that under the Ryan plan fewer Medicaid beneficiaries are likely to get care, so they won't have to worry about any stigma associated with their treatment.

Ryan also touts the great success of the welfare reform passed in 1996 (page 41). He apparently has not noticed the large rise in child poverty rates in this recession as well as the limited response of Temporary Assistance for Needy Families spending to the large rise in unemployment due to the recession.

Ryan cuts the baseline $7.8 trillion in defense spending projected for the next decade by just 1.0 percent. Apparently the Congressman believes in a strong safety net for defense contractors.

Ryan replaces Medicare with a voucher program for those under age 55. (My brother wants to know what happens to people who turn age 55 this year.) He apparently didn't notice that the private health care system has not been successful in controlling costs for the non-Medicare population.

And best of all, Representative Ryan proposes some help for the really needy. He wants to lower the top tax rate from the 39.6 percent in current law (after 2012) to 25 percent. This will means millions of dollars a year in additional spending money for Wall Street bankers, CEOs of major corporations and other major campaign contributors.

The reason why this is so useful is that there is nothing in the Ryan plan that has not been circulated in policy circles for decades. Almost everything in the plan has been tried and failed. The plan ignores obvious economic realities, such as the bubble-induced recession that has left 25 million people unemployed or underemployed. It doesn't lay a glove on the rich and powerful, while threatening to undermine the limited economic security enjoyed by tens of millions of middle class families.

Yet many pundits will applaud the plan as brave, innovative and creative. In making these pronouncements these pundits will immediately reveal themselves as worthless hacks who either lack the ability or desire to do their own thinking. Their endorsement of the Ryan plan will be like a scarlet letter permanently marking them as someone who has no place in a serious policy discussion. For this reason we owe Mr. Ryan a real debt of gratitude.


Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of The End of Loser Liberalism: Making Markets Progressive. He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues.

 

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