Tag Archives: Milwaukee Journal Sentinel
Cheddar Revolution: Moldy Yet?
Kris Maher and Amy Merrick at WSJ:
Playing a game of political chicken, Democratic senators who fled Wisconsin to stymie restrictions on public-employee unions said Sunday they planned to come back from exile soon, betting that even though their return will allow the bill to pass, the curbs are so unpopular they'll taint the state's Republican governor and legislators.
The Republicans rejected the idea that the legislation would hurt the GOP. "If you think this is a bad bill for Republicans, why didn't you stand up in the chamber and debate us about it three weeks ago?" said Senate Majority Leader Scott Fitzgerald. "People think it's absolutely ridiculous that these 14 senators have not been in Wisconsin for three weeks."
The Wisconsin standoff, which drew thousands of demonstrators to occupy the capitol in Madison for days at a time, has come to highlight efforts in other states to address budget problems in part by limiting the powers and benefits accorded public-sector unions.
Sen. Mark Miller said he and his fellow Democrats intend to let the full Senate vote on Gov. Scott Walker's "budget-repair" bill, which includes the proposed limits on public unions' collective-bargaining rights. The bill, which had been blocked because the missing Democrats were needed for the Senate to have enough members present to vote on it, is expected to pass the Republican-controlled chamber.
Eric Kleefeld at Talking Points Memo:
A return to Wisconsin at this juncture would appear to give the green light for Walker's legislation to pass — that is, a win for Walker's efforts to pass legislation when numerous polls show the state disapproving of Walker, and saying he should compromise. However, at this juncture it is unclear just what is going on.
In response, Miller spokesman Mike Browne released this statement, saying only that they were continuing to negotiate towards an outcome that does not strip the bargaining rights of state workers:
"It is true that negotiations were dealt a setback since last Thursday when Governor Walker responded to a sincere Democratic compromise offer with a press conference. However, Senate Democrats have continued to reach out to the Governor and Republicans through the weekend.
Democrats remain hopeful that Governor Walker and legislative Republicans will, in the near future, listen to the overwhelming majority of Wisconsinites who believe they should come to the negotiating table in good faith to reach an agreement that resolves our fiscal issues without taking away worker rights and without hurting programs that help provide health insurance for working families and prescription drugs for seniors."
In addition, state Sen. Chris Larson released this statement:
Sen. Miller's comments are taken out of context in the Wall Street Journal article just released. Dems will return when collective bargaining is off the table. That could be soon based on the growing public opposition to the bill and the recall efforts against Republicans. Unfortunately, the WSJ fished for the quote they wanted, skipping this key step in logic: we won't come back until worker's rights are preserved.
State Sen. Jon Erpenbach also told WisPolitics that Democrats are not planning to return. State Sen. Bob Jauch, who has been one of the lead negotiators, also said of Miller's comments: "I think he's speaking the truth that at some point – and I don't know when soon is – at some point we have to say we've done all we can."
Christian Schneider at The Corner:
The Wisconsin politerati is all atwitter today at a WSJ report indicating that senate Democrats might soon end their Illinois exile. In the article, Democratic senate leader Mark Miller says recent polls show Walker's budget-repair bill to be politically "disastrous" for the governor, which he says will give Democrats more leverage to negotiate portions of the larger budget bill in the weeks to come.
If this is what Miller thinks, it seems like a suspect strategy — a variation on the rarely seen Let's capitulate to our opponent because the public currently doesn't like what he's doing plan. How many congressional Republicans rooted for Obamacare because they thought it would show the public once and for all how unpopular government health care could be? What if Green Bay Packer quarterback Aaron Rodgers said in an interview before the Super Bowl, "Maybe it won't be so bad if the Steelers win — imagine how sick of Ben Roethlisberger the public will be"? It sounds like Mark Miller, in today's parlance, has convinced himself that he's "winning."
Perhaps Miller's quote was a trial balloon, meant to gauge the opposition he'll get from his base, which has spent three weeks screaming itself hoarse on the steps of the state capitol. It would be reasonable to expect some displeasure: If Democrats do return and vote on the bill without any changes — as they had indicated they would never do — cops, firefighters, and teachers are likely to ask, "Why did I just spend three weeks in the capitol pressed up against a hippie?" Indeed, within hours of the story being published, Miller was rebuffed by some members of his own caucus.
On the other hand, it is possible that Scott Walker really has waited them out. (On his last physical, does it say "Blood Type: Tiger"?) In the past three weeks, Democrats and public-sector unions (but I repeat myself) have thrown everything they have at Walker, and he hasn't budged. (And I do mean everything: They even tried to embarrass him by exposing the fact that in high school he had a mullet and was nicknamed "the Desperado" — unaware that in Wisconsin, this is likely to increase his approval rating.)
It seems a little short-sighted for senate Democrats to believe Walker has damaged himself irreparably. Several polls show Walker's approval rating to be in the low 40's, but Walker almost certainly expected to take some kind of public-relations hit when he entered this standoff.
Moe Lane at Redstate:
You see, we tend to forget that politicians are not identical, like potatoes: these fourteen men and women are just that – men and women – and it's easy to believe that they're getting tired, sore, and fuming about how they've somehow become the surrogate whipping boys for a national debate on public sector unions. Some of them might even be thinking that they didn't actually sign up for this, that this wasn't in the job description, and that the people urging them to exile in Illinois might not really give a tinker's dam about them or their problems. And that this situation that they're in is getting old. Oh, sure, no doubt a few of the AWOL senators are having a ball… but some of them are not, and the loss of message discipline in the last few days shows that.
And it only takes one AWOL senators to end this nonsense.
Scott Johnson at Powerline
Jason Stein at The Milwaukee Journal Sentinel:
The leader of Senate Democrats hiding out in Illinois is seeking a face-to-face meeting with Gov. Scott Walker and the Senate GOP leader.
Senate Minority Leader Mark Miller (D-Monona) said in a letter sent out Monday that he wants to meet with Republicans "near the Wisconsin-Illinois border to formally resume serious discussions" on Walker's budget repair bill. Two other Democratic senators met with Senate Majority Leader Scott Fitzgerald (R-Juneau) last week in Kenosha.
Democrats have been holed up south of the state line since last month to block action on Walker's budget repair bill, which would end most collective bargaining for public employee unions in the state.
"I assure you that Democratic state senators, despite our differences and the vigorous debate we have had, remain ready and willing to find a reasonable compromise," Miller said in the letter.
Neither Miller nor Walker spokesman Cullen Werwie could be reached immediately for further comment. Fitzgerald spokesman Andrew Welhouse had no immediate comment.
The Wall Street Journal spurred hopes of compromise Sunday with a story citing Miller and saying the Democrats would be back "soon." But that same night Democrats knocked that down, saying that they hoped to return soon but that there was still no development to make that happen.
Miller spokesman Mike Browne said Monday morning that he knew of no plans for Democrats to return later in the day. The senators were scheduled to meet later in the morning or early afternoon, he said.
One of the Democratic senators, Tim Cullen of Janesville, said in a phone interview Sunday that there were no developments toward a possible compromise with Republicans and no talks scheduled for this week.
Two other Democratic senators — Jon Erpenbach of Middleton and Chris Larson of Milwaukee — said Sunday their group had no plans to come back to the Capitol until Republicans addressed more of their concerns with the budget-repair bill.
"I can tell you for a fact that nothing has changed down here," Erpenbach said.
On Monday morning, a small, dedicated group began to chant in protest of Walker's budget-repair bill in the Capitol rotunda.
Outside the Capitol, there is little or no sign of the mass protests that have engulfed the Capitol square in recent weeks.
On the streets surrounding the Capitol, the number of satellite trucks has dwindled to two. And the only sign of an organized-labor presence is the sight of two Teamsters semi-trailers.
Filed under Economics, Legislation Pending
Tagged as Amy Merrick, Christian Schneider, Economics, Eric Kleefeld, Jason Stein, Kris Maher, Legislation, Milwaukee Journal Sentinel, Moe Lane, National Review, Powerline, Redstate, Scott Johnson, Talking Points Memo, Wall Street Journal
Talkin' Flim-Flam Lotsa Krugman Posts Blues
Paul Krugman in the NYT:
One depressing aspect of American politics is the susceptibility of the political and media establishment to charlatans. You might have thought, given past experience, that D.C. insiders would be on their guard against conservatives with grandiose plans. But no: as long as someone on the right claims to have bold new proposals, he's hailed as an innovative thinker. And nobody checks his arithmetic.
Which brings me to the innovative thinker du jour: Representative Paul Ryan of Wisconsin.
Mr. Ryan has become the Republican Party's poster child for new ideas thanks to his "Roadmap for America's Future," a plan for a major overhaul of federal spending and taxes. News media coverage has been overwhelmingly favorable; on Monday, The Washington Post put a glowing profile of Mr. Ryan on its front page, portraying him as the G.O.P.'s fiscal conscience. He's often described with phrases like "intellectually audacious."
But it's the audacity of dopes. Mr. Ryan isn't offering fresh food for thought; he's serving up leftovers from the 1990s, drenched in flimflam sauce.
Mr. Ryan's plan calls for steep cuts in both spending and taxes. He'd have you believe that the combined effect would be much lower budget deficits, and, according to that Washington Post report, he speaks about deficits "in apocalyptic terms." And The Post also tells us that his plan would, indeed, sharply reduce the flow of red ink: "The Congressional Budget Office has estimated that Rep. Paul Ryan's plan would cut the budget deficit in half by 2020."
But the budget office has done no such thing. At Mr. Ryan's request, it produced an estimate of the budget effects of his proposed spending cuts — period. It didn't address the revenue losses from his tax cuts.
The nonpartisan Tax Policy Center has, however, stepped into the breach. Its numbers indicate that the Ryan plan would reduce revenue by almost $4 trillion over the next decade. If you add these revenue losses to the numbers The Post cites, you get a much larger deficit in 2020, roughly $1.3 trillion.
And that's about the same as the budget office's estimate of the 2020 deficit under the Obama administration's plans. That is, Mr. Ryan may speak about the deficit in apocalyptic terms, but even if you believe that his proposed spending cuts are feasible — which you shouldn't — the Roadmap wouldn't reduce the deficit. All it would do is cut benefits for the middle class while slashing taxes on the rich.
Paul Krugman on his blog:
Aha — I just realized that I should probably post my predictions about Rep. Paul Ryan's response to today's column before I see the inevitable letter to the Times.
So, I predict a double-talk response similar to his response to the Tax Policy Center analysis. In that response, he declared that
The tax reforms proposed and the rates specified were designed to maintain approximately our historic levels of revenue as a share of GDP, based on consultation with the Treasury Department and tax experts. If needed, adjustments can be easily made to the specified rates to hit the revenue targets and maximize economic growth.
In other words, we think the tax part of the plan would leave revenue unchanged. But in that case, why not ask CBO to score the revenue, to see if it agrees? The answer given is that CBO refused to do an analysis beyond 10 years; OK, but why not at least have the 10-year analysis?
Oh, and about "adjustments can be easily made" — when, exactly? Based on a careful look at the numbers? In that case, why tell the CBO not to do that careful look? After the tax cuts are enacted? On my planet, Republicans never consider it advisable to undo tax cuts once they're law. And notice the weasel phrase "to hit the revenue targets and maximize economic growth." In practice, this would surely mean no increase in rates, ever.
Peter Suderman at Reason:
So what's Krugman's big complaint? When TPC looked at Ryan's plan, its analysis concluded that the Roadmap wouldn't raise nearly the amount of revenue that Ryan estimated and, as a result, would actually raise the deficit.
ut this was all hashed out months ago between Ryan and the TPC. As Ryan has noted, his plan's revenue estimates were made in consultation with the Treasury Department in 2009. And they were based on CBO's alternative fiscal scenario, which, at the time the revenue projections were made, expected somewhat higher growth than when TPC performed its estimates. That probably explains some of the difference. But, says Ryan, if TPC's projections looked to be accurate, he'd be happy to adjust his plan in order to meet his revenue targets.
Does this sound like the work of a flimflam artist to you? Forecasting the vagaries of the economy five or 10 years in advance is incredibly difficult; most projections are bound to be off, and quality analysts doing quality work will inevitably disagree about what our economic future holds. But it seems to me that the people who are worth listening to are those who engage in thoughtful dialogue with the opposition, who accept that the future—as well as any projection that claims to predict it—is uncertain, and who agree to change plans accordingly. This is exactly what Ryan has done.
Krugman, meanwhile, is grumbling that Ryan's plan "makes no useful contribution to the debate over America's fiscal future" while moaning that the $787 billion deficit-funded stimulus was too small and asking for another round of deficit spending. Gotcha. Please pass the flimflam sauce?
Reihan Salam:
Krugman is relying on the power of aggregation, and one can't help but admire his polemical skill. (Note that at least some of the rhetorical power of Krugman's statement rests on the false impression that the poor would face a heavier tax burden.) It is also true, however, that almost any shift towards consumption taxes would have the same impact. Households at the top tend to save and invest more than households in the middle. A VAT or progressive consumed-income tax would both place a heavier burden on less-affluent households than on more-affluent households for that reason. Yet consumption taxes have other virtues.
So it seems that Krugman's basic problem is with consumption taxes. And that's perfectly respectable. This, however, places him at odds with many tax policy experts, who believe that we need to shift to consumption taxes that are less damaging to U.S. growth prospects than income taxes at the same level.
So is Rep. Ryan's plan a "fraud," as Paul Krugman describes? It is only a "fraud" insofar as, like any broad reform plan, it rests on contested assumptions about the future. If anything, Rep. Ryan's openness to revision is a refreshing departure from the norm. At the heart of the plan is a serious effort to restrain growth in entitlement spending, an effort that will prove difficult and, almost by definition, surprising as the economy continues to evolve. What is clear, however, is that either spending burden has to be tackled or the tax burden — for all households — will have to increase.
I'm personally skeptical about Rep. Ryan's particular vision for tax reform. The structure strikes me as unwieldy. I do, however, like its emphasis on simplifying deductions and shifting the burden from income to consumption. But there is room for disagreement.
Pejman Yousefzadeh at The New Ledger:
It's good to see that Krugman is being taken to the woodshed for petulant and irresponsible commentary. At best, Krugman is a hack writer who can't argue his way out of a paper bag. At worst–and more likely–he is just plain disingenuous. But again, Krugman's ongoing effort to lie to his readers deserves the attention and opprobrium of the New York Times Ombudsperson. How many more times must Krugman flout common sense before the New York Times acts to save its reputation and integrity?
Ezra Klein:
A number of you have written to ask what I think of Paul Krugman's column attacking Paul Ryan's budget. As far as Krugman's policy critique goes, I agree. I'd refer people back to my post "Paul Ryan's budget proposal does not balance the budget," which uses the same Tax Policy Center data that Krugman does. The question comes down to whether Ryan is serious about increasing the revenues in his plan from 16 percent of GDP to 19 percent of GDP. He says he is, but as far as I know, he has not modified his proposal to reflect that.
Then there's the question of spending cuts. I'm mainly interested in Ryan's decision to convert Medicare and Medicaid to vouchers and then hold down costs by making the vouchers grow more slowly than the price of health care. As I've written before, I think this is a bad idea. It rations by making people less able to access health care rather than by making care itself cheaper, and it converts Medicare to private insurance when Medicare has repeatedly proven itself cheaper than private insurance. But where Ryan's colleagues refuse to offer any solutions and instead just attack Democrats for "rationing," Ryan is showing how conservatives would ration. I think that's productive.
And now let's get to the paragraph a lot of you will flay me for: I don't think Ryan is a charlatan or a flim-flam artist. More to the point, I think he's playing an important role, and one I'm happy to try and help him play: The worlds of liberals and conservatives are increasingly closed loops. Very few politicians from one side are willing to seriously engage with the other side, particularly on substance. Substance is scary. Substance is where you can be made to look bad. And substance has occasionally made Ryan look bad. But the willingness to engage has made him look good. It's given some people the information they need to decide him a charlatan, and others the information they need to decide him a bright spot. It's also given Ryan a much deeper understanding of liberal ideas than most conservative politicians have.
Krugman responds:
Ezra Klein says he agrees with me on my policy critique of Paul Ryan, but denies that he's a flimflammer.
He's wrong.
Long ago — basically when I started writing for the Times — I decided that I would judge the character of politicians by what they say about policy, not how they come across in person. This led me to conclude that George W. Bush was dishonest and dangerous back when everyone was talking about how charming and reasonable he was. It led me to conclude that Colin Powell couldn't be trusted, back when everyone said his UN speech clinched the case for war. It led me to conclude that John McCain was unprincipled and self-centered, back when everyone said he was a deeply principled maverick. And yes, it led me to conclude that Barack Obama was a good man, but far less progressive than his enthusiastic supporters imagined.
And so I don't care how Paul Ryan comes across. I look at how he has gone about selling his ideas, and I see an unscrupulous flimflammer.
Ted Gayer at Brookings:
Given that columnist Paul Krugman relied on Tax Policy Center estimates to level claims that Congressman Paul Ryan is a "flimflam man" and that Ryan's plan to address our fiscal problems is a "fraud," I think a defense of the Congressman is in order.
First, it is worth citing budget estimates from the Congressional Budget Office (CBO). According to CBO, Congressman Ryan's Roadmap for America's Future Act would dramatically reduce the build up of America's debt. CBO estimates that his plan would result in a debt to gross domestic product ratio (GDP) of 69 percent in 2020, rising to 99 percent in 2040, and then decreasing to 77 percent in 2060. This is in contrast to CBO's estimates for its alternative fiscal scenario (which assumes a continuation of current policy) where the debt-to-GDP ratio is 87 percent in 2020, and then rises sharply to 223 percent in 2040 and 433 (!) percent in 2060.
On the spending side, Congressman Ryan's plan achieves these substantial reductions in our long-term debt through such things as progressive reductions in Social Security benefits, increases in the eligibility age for Medicare, and the replacement of Medicare benefits with a voucher starting in 2021 (with an average initial voucher value for 65-year-olds of $5,900 in 2010 dollars).
On the revenue side, Ryan has proposed creating an alternative income tax system that has two marginal tax rates, eliminates most deductions and credits, and exempts all interest, dividends, and capital gains from the individual income tax. Filers would get to choose between the existing income tax and the new system. Ryan would also replace the corporate income tax with a business consumption tax (essentially a value-added tax).
Krugman alleges fraud because CBO did not score the revenue side of the Congressman's plan. (This is correct as the Joint Committee on Taxation is responsible for providing the official revenue score of tax legislation.) Instead, CBO assumed that total federal tax revenues will be equal to "those under CBO's alternative fiscal scenario … until they reach 19 percent of gross domestic product in 2030, and to remain at that share of GDP thereafter." Contrary to Krugman's claims, this assumption is not unjustified. Ryan has explicitly stated that he is willing to work with the Treasury department to adjust the rates on his tax reform plan to "maintain approximately our historic levels of revenue as a share of GDP." Since 1980 the federal tax revenue has been about 18 percent of GDP.
Nate Silver:
I weighed in a little bit on Twitter today on Paul Krugman's critique of Paul Ryan's "Roadmap to America's Future" plan. It was probably a mistake do that 140 characters at a time, and so here is a (much) longer exposition.
Krugman comes to the conclusion that "The Ryan plan is a fraud that makes no useful contribution to the debate over America's fiscal future." Some writers, including Ted Gayer at the Tax Policy Center, a thinktank whose work Krugman cited, take issue with the use of the term "fraud". Fraud can mean different things, but usually implies some intentionality: deception on purpose, rather than on accident. I don't know if Ryan's budget plan is deliberately intended to be deceitful: people in Ryan's circle seem to vouch for his seriousness, and there's much to be said for that. With that said, it has had the effect of deceiving some people, and I don't see how it has improved the quality of the budget discussion.
Ryan's budget consists of a series of proposals that would cut spending on entitlement programs in a very serious way, coupled with an equally serious restructuring of the tax code that would have the effect of lowering taxes on most individuals and businesses. On the spending side, one can debate whether or not the cuts that Ryan proposes would be (a) wise and (b) politically tenable, but they would certainly reduce the debt in a very substantial way; nobody really doubts that.
The problem is on the government revenues side, which Ryan's tax cuts would reduce, thereby counteracting the effect of his ambitious spending cuts. I'm not going to spend 200 words qualifying this: yes, tax increases have deleterious effects on productivity, which means that you're giving back some number of pennies on the dollar — and tax cuts have beneficial ones, thereby making the opposite true. But, given that current levels of taxation are low-ish by modern standards, and that Ryan's budget would make them lower, we are nowhere near the point on the Laffer Curve where tax cuts would have a net positive effect on government revenues. (In the long run, at least: tax cuts are more beneficial during a recession when a multiplier may be in play.)
Where the deceptiveness comes in is in the CBO's scoring of Ryan's proposal, which makes it appear as though Ryan's plan would substantially reduce the debt over current projections. The problem, as a separate Krugman blog post points out, is that the CBO actually only scored half the bill: they gave Ryan credit for the spending cuts, but did not deduct any points for the revenue reductions resulting from his changes to the tax code.
This is for a somewhat peculiar reason. The CBO does not like to model the impacts of tax policy, which is usually in the purview of another agency, the Joint Committee on Taxation (JCT). Ryan's office has said that they asked the CBO to score the revenue side of the bill and were rebuffed; I have no reason to doubt this. The problem is in what happened next.
Ryan's office had several options. They could have said: "Screw you, CBO, you work for us." (This is literally true; the CBO is the Congressional Budget Office.) "Score the damned tax cuts." I know nowhere near enough about intra-agency politics to know whether any amount of cajoling, threatening, or persuasion would have made the difference here, nor how much of it Ryan's office attempted.
The second and most obvious alternative would have been ask the JCT for an estimate instead. Ryan's office says that "JCT, however, does not have the capability at this time to provide longer-term revenue estimates". I don't know whether that means that JCT was too busy right at that moment, in which case Ryan was irresponsible not to wait for its workload to lighten up, or whether it means that very-long-term (beyond 10 years) budgetary estimates are not a current operational capability of the JCT.
If the latter, the third option would have been to utilize an estimate provided by nongovernmental agency, ideally one with a reputation for being de facto non-partisan (not just de jure non-partisan, like the Heritage Foundation). Something like the Tax Policy Center probably qualifies, as would a few other Beltway thinktanks.
But Ryan bypassed this option as well; instead, he decided to wing it. And he winged it by assuming that, in fact, his tax cuts would result in no net decrease in revenues: they'd magically be offset by improved economic growth. Ryan then instructed the CBO to score the bill with this dubious assumption, which it did.
The Tax Policy Center found that Ryan's assumption had in fact been rather favorable to the cause: it had overestimated revenues by a mere 4 trillion dollars in revenues over 10 years — the equivalent of several health care bills.
This is all there in the CBO's report if you read the fine print. But a lot of people, including Perry Bacon, a very fine reporter for the Washington Post, didn't read the fine print, and instead wrote largely favorable pieces that took the CBO's projections too much at face value and did not adequately notate that they'd really only scored half the bill.
One thing that has been overwhelmingly obvious in the discussion of Paul Ryan's roadmap is that lots of people who should know better — including, alas, reporters at the Washington Post — don't know how to read a CBO report. They think you can just skim it and get the gist; and people like Mr. Ryan have taken advantage of that misconception.
What you need to realize is that the CBO is the servant of members of Congress, which means that if a Congressman asks it to analyze a plan under certain assumptions, it will do just that — no matter how unrealistic the assumptions may be. CBO will tell you what's going on, but it will do so deadpan, doing nothing in terms of emphasis or placement to highlight the funny business.
So how do you spot that funny business? One way is to go through the whole thing with a fine-toothed comb. Another is to look at the estimate, and see if anything odd jumps out — then search for the sources of that oddity.
So, the key table in the CBO report on the Ryan plan (pdf) looks like this:
CBO
Look at the column for 2020, which allegedly shows a big reduction in the deficit for that year. What do we see?
Well, the Ryan plan as described is a combination of tax cuts and cuts in entitlement spending. So where does this show in the CBO estimate?
On the tax side, we immediately see that the CBO finds no effect — revenue with the Ryan plan is the same as without it. Huh? Search the report, and you find:
The proposal would make significant changes to the tax system. However, as specified by your staff, for this analysis total federal tax revenues are assumed to equal those under CBO's alternative fiscal scenario (which is one interpretation of what it would mean to continue current fiscal policy) until they reach 19 percent of gross domestic product (GDP) in 2030, and to remain at that share of GDP thereafter.
In short, the CBO was told to disregard any possible effects of the tax cuts; that's a pretty good way to make the plan seem affordable.
As a matter of fact, Paul Ryan is willing to work on the revenue side. And he has explained this–on his web site, in February, when these complaints were first aired. The short version:
1. He asked the CBO to do a revenue analysis, and they declined on the grounds that it was the jurisdiction of the JCT.
2. The JCT couldn't do analysis longer than ten years; period, so they asked for help from Treasury and some outside tax experts.
My recollection is also that Paul Ryan couldn't get the JCT committee staff time anyway because they were a wee bit busy doing all the forecasts for health care reform, and the Roadmap is not going to pass barring some miracle. But I was a wee bit busy with health care reform as well, so I could be wrong about that.
At any rate, the answer to Paul Krugman's question "Why didn't he ask" is that "He did, and they said no."
While I remain skeptical that anything like the Roadmap is politically possible, Paul Ryan is doing exactly what any sensible congressional sponsor with limited access to CBO time does; he's saying "Well, when this is getting close to being an actual bill, we'll work with the CBO and the JCT to tweak the tax rates in order to provide the amount of revenue we need." This is entirely normal, and was, incidentally, how the health care bill that Krugman so loves got its excellent CBO score; as I recall, the nascent plans were deficit busters and cost a lot more money. That's why the Tax Policy Center blog is defending Ryan.
Though I've only met him once, everything I've heard about Ryan indicates that he genuinely loves this stuff–if he could have more time with the CBO and JCT staff, he'd be in heaven. I think it's absolutely fair to point out that his Roadmap would be a heroic political sell, and would probably be watered down in ways that would seriously weaken it. I also think it is absolutely fair to point out that the tax rates needed to raise the necessary revenue would probably–not definitely; the TPC is not omniscient–be considerably less popular than what is outlined in the Roadmap.
But it is not correct to accuse Ryan of deliberate dishonesty; he asked the CBO to score it, and they turned him down. Nor is it correct to imply that this is somehow out of the ordinary. If you supported the health care plan, you supported the exact same process that Ryan is now proposing to use to tweak his proposal. Were they all brazen liars because the tweakery turned out to be a lot harder than they'd hoped?
Kevin Drum responds to McArdle:
But look: Ryan surely has some responsibility to make the tax side of his plan as realistic as possible, especially given his chosen role as toughminded truthteller. And the Tax Policy Center made it pretty clear months ago that he wasn't even close to his revenue goal. It's easy to wave this off as requiring mere "tweaks" to the tax rates, but those tweaks are exactly the place where anyone would quite reasonably be most suspicious of Ryan's willingness to play fair. After all, two or three points of GDP is a lot of money, and a tax skeptic like Ryan is going to have a very hard time making the changes necessary to come up with that kind of dough.
Ryan's Roadmap is 70 pages long and obviously the result of a lot of work. So why not put in a little more work and bring the tax side of the plan into the realm of reason? Is it really that cynical to think it's because he's trying to get credit for being a deficit fighter without having to give up the dramatic tax cuts for the rich he so obviously has his heart set on?
Paul Ryan at The Milwaukee Journal Sentinel:
Despite watching European welfare states collapse under the weight of their own debt, those running Washington are leading us down precisely the same path. With the debt surpassing $13 trillion, we can no longer avoid having a serious discussion about how to address the unsustainable growth of government.
Unfortunately, rather than make meaningful contributions to this conversation and bring solutions to the table, Democrats have attempted to win this debate by default. Relying on demagoguery and distortion, the left would prefer that entitlements – often labeled the "third rail" of American politics – remain untouchable, and the column by Paul Krugman of The New York Times is indicative of the partisan attacks leveled against the plan I've offered, a "Roadmap for America's Future."
When I introduced the "Roadmap," my hope was that it would spur an open and honest discussion about how our nation can address its fiscal challenges. If we are truly committed to developing real solutions, this discussion must be free of the inflammatory rhetoric that has derailed past reform efforts. In keeping with this spirit, it is necessary to clarify some of the inaccurate claims and distortions made recently regarding the "Roadmap."
The assertion by Krugman and others that the revenue assumptions in the "Roadmap" are overly optimistic and that my staff directed the Congressional Budget Office not to analyze the tax elements of the "Roadmap" is a deliberate attempt to misinform and mislead.
I asked the CBO to analyze the long-term revenue impact of the "Roadmap," but officials declined to do so because revenue estimates are the jurisdiction of the Joint Tax Committee. The Joint Tax Committee does not produce revenue estimates beyond the 10-year window, and so I worked with Treasury Department tax officials in setting the tax reform rates to keep revenues consistent with their historical average.
What critics such as Krugman fail to understand is that our looming debt crisis is driven by the explosive growth of government spending – not from a lack of tax revenue.
Krugman also recycles the disingenuous claim that the "Roadmap" – the only proposal certified to make our entitlement programs solvent – would "end Medicare as we know it."
Ironically, doing nothing, as Democrats would prefer, is certain to end entitlement programs as we know them, and in the process, beneficiaries would face painful cuts to these programs. Conversely, the "Roadmap" would pre-empt these cuts in a way that prevents unnecessary disruptions for current beneficiaries.
It reforms Medicare and Social Security so those in and near retirement (55 and older) will see no change in their benefits while preserving these programs for future generations of Americans. We do not have a choice on whether Medicare and Social Security will change from their current structure – the true debate is if and how these programs will be made solvent.
Far from the "radical" label that critics have tried to pin on it, the Medicare reforms in the "Roadmap" are based on suggestions made by the National Bipartisan Commission on the Future of Medicare, chaired by Sen. John Breaux (D-La.). That commission recommended in 1999 "modeling a system on the one members of Congress use to obtain health care coverage for themselves and their families." With respect to Medicare and Social Security, the "Roadmap" puts in place systems similar to those members of Congress have. There has been support across the political spectrum for these types of reforms.
OK, here's Ryan's reply. As I predicted, a snow storm of words, dodging the math questions.
Notice that Ryan does not address the issue of the zero nominal growth assumption, and how that assumption — not entitlement reforms — is the key to his alleged spending cuts by 2020.
I also see that Ryan is perpetuating the runaround on revenue estimates. If you read either this article or his original response to the Tax Policy Center, you could easily get the impression that nobody would do a revenue estimate, that CBO said it was JCT's job, and JCT balked. Even Nate Silver has fallen for this. But read the original response carefully:
The Tax Policy Center analysis covers a 10-year period, but the Roadmap is a long-term plan with spending and revenue projections covering 75 years. As such, the analysis is not consistent with the long-term horizon of the plan. Staff originally asked CBO to do a long-term analysis of both the tax and spending provisions in the Roadmap. However, CBO declined to do a revenue analysis of the tax plan, citing that it did not want to infringe on the traditional jurisdiction of the JCT. JCT, however, does not have the capability at this time to provide longer-term revenue estimates (i.e. beyond 10 years) [my emphasis]. Given these functional constraints for an official analysis, staff relied on its original work with the Treasury Department and other tax experts to formulate a reasonable expected path for long-term revenues given the tax policies in the Roadmap combined with the economic growth projections available at the time.
In other words, Ryan could have gotten JCT to do a 10-year estimate; it just wouldn't go beyond that. And he chose not to get that 10-year estimate. So it was Ryan's choice not to have any independent estimate of the 10-year revenue effects.
And bear in mind that the Tax Policy Center critique was five months ago. If Ryan disagreed with the center's estimates, he could have gone back to the JCT to get a different set of estimates. He never did.
By the way, if you look at the artful way his excuses are constructed — giving the false impression that he couldn't get a revenue score for love nor money — how is that not flimflam?
John McCormack at The Weekly Standard:
Talking late this afternoon with THE WEEKLY STANDARD, Republican congressman Paul Ryan of Wisconsin blasted New York Times columnist Paul Krugman for his "intellectualy lazy" attack on Ryan's fiscal "Roadmap." In his Friday column, Krugman called Ryan a "charlatan" and his plan to reform the welfare state and eliminate the debt a "fraud" that is "drenched in flimflam sauce." Ryan responded to Krugman in the Milwaukee Journal Sentinel over the weekend, and elaborated on his criticisms of Krugman this afternooon.
"I realize he's a columnist and not a journalist, yet he could have easily tried to have verified his claims with a phone call or an email," Ryan said of Krugman. "Instead he went with his confusion and chose to impugn motives," said Ryan, "which strikes me as a very intellectually lazy exercise or style."
While Ryan focused on the nitty-gritty policy aspects of his Roadmap this afternoon, he suggested that the underlying argument is about principles, not facts. "At the core of this is a big ideological fight between those who believe in the Founding principles and the sense of limited government—the American idea—and those who believe in the progressivist welfare state," Ryan said.
"The Roadmap is designed to maintain a limited government in the 21st century, and it is the antithesis of the progressivist vision which [Krugman] subscribes to. That's fine. I understand it violates his vision for a progressivist society," Ryan continued. "What I think is rather bizarre is his strange personal attack and ad hominem attacks based upon his confusion surrounding the scoring process, which could have been easily clarified with a simple phone call or email."
"I'm not going to descend into the mudpit with Krugman on this stuff," Ryan said. "I want to stay on policy and ideas."
John Hinderaker at Powerline:
Arguing with Krugman calls to mind the old adage about mud-wrestling with a pig: not only do you wind up muddy, but the pig actually likes it. The Roadmap deserves to be debated, but don't expect any liberals to join the debate in good faith.
Filed under Economics, Mainstream, Political Figures
Tagged as Brookings Institute, Economics, Ezra Klein, John Hinderaker, John McCormack, Kevin Drum, Mainstream Media, Megan McArdle, Milwaukee Journal Sentinel, Nate Silver, New York Times, Paul Krugman, Paul Ryan, Pejman Yousefzadeh, Peter Suderman, Political Figures, Powerline, Reason, Reihan Salam, Ted Gayer, The New Ledger, The Weekly Standard