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Is Ryan Really a Fiscal Hawk? Is Ryan Really a Fiscal Hawk?

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Congress / POLITICS

Is Ryan Really a Fiscal Hawk?

He's voted to cut, but also to spend lavishly.

photo of Matthew Cooper
August 15, 2012

Back in November of 2003, the White House was worried. So were House Republican leaders.

At issue: President George W. Bush had to use all of his political clout to get enough House Republicans to pass his proposed Medicare prescription-drug benefit. Many House Republicans balked at the cost, and some had to be confronted on the floor to get them to vote for the largest entitlement expansion since the Great Society programs of the 1960s. One House member said she hid out, avoiding making contact with House leaders. At one point, the vote was stopped, and the clock and even the C-SPAN cameras were frozen for three hours so GOP leaders could round up the votes. One of the votes for the package was Rep. Paul Ryan, R-Wis. Despite a shaky start, the benefit, also called Medicare Part D, proved immensely popular—and expensive. According to a report by the then-Comptroller General David Walker, the benefit contained $8 trillion in unfunded liabilities. (Current estimates have it more in the $7 trillion range.)

Ryan has often said that he regretted the big spending during the Bush era and that he often cast votes that he regretted. But that doesn’t belie the fact that Ryan, despite his reputation as a fiscal hawk, has voted for some pricey items over the years that have added to the debt burden of the United States.

 

The prescription-drug benefit may be the most pertinent example, because so many Republicans balked at its price tag and its expansion of the federal role in health care. (Many Democrats liked the idea of a drug benefit for seniors but did not like the restrictions on the federal government negotiating prices for pharmaceuticals that might have kept the cost of drugs down, as it has for, say, Veterans Affairs.) Any number of notable Republicans bucked the president, including some who ran for president this year, such as Rep. Ron Paul, R-Texas, and Rick Santorum, then the junior senator from Pennsylvania.

Walker argues that, in fact, 2003 was a particularly bad year for America’s fiscal health. First, the country passed the second round of Bush tax cuts, which, Walker notes, came after the country had already gone back to running deficits. The first round of Bush cuts in 2001 came when the country was running a surplus. Second was the enormous Medicare prescription drug benefit, and the third was the invasion of Iraq, for which no taxes were levied. “2003 was arguably our most fiscally irresponsible year,” Walker told National Journal.

The Bush tax cuts added some $2.8 trillion to the national debt, according to the Congressional Budget Office. Ryan voted for those cuts, although defenders argue that without their stimulative effect on the economy, growth would have slowed. Ryan also backed the Troubled Asset Relief Program bailout, most of which has been paid back, and the auto bailout.

As Reihan Salam noted in the National Review on Tuesday afternoon, Ryan’s support of the Medicare prescription-drug debate came after he argued for keeping it wed to a premium support plan, the kind of quasi-voucher plan that made it into the much-discussed “Ryan plan.” That Ryan stuck with the prescription-drug benefit even after it was severed from his premium support plan, Salam argues, is proof that Ryan is either flexible or an opportunist, but not the budget-slashing ideologue that he’s been portrayed as.

Another way of looking at it is that Ryan is capable of cognitive dissonance—holding conflicting ideas at the same time. His plan does reduce Medicare spending dramatically by turning it into a program where seniors are encouraged to take a government subsidy and by putting health insurance on the open market. He cuts Medicaid, the program for the poor, even more dramatically, essentially turning it into block grants for the states. Walker says that Ryan “should be commended for having the courage to lay out a comprehensive and bold plan that represents his view that government has grown too big and needs transformational change.”

At the same time, his plan promises enormous tax cuts that would be paid for by an unspecified rollback of loopholes that would account for the lower rates. Pulling that off would require razing deductions to an extent unheard of in the 1986 tax reform that Ryan has cited as part of his inspiration. When you combine that with Ryan’s big spending, you have a candidate with a profoundly mixed record best understood in context and not with slogans.

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