The Magazine

A Tale of Two Budgets

Paul Ryan draws the contrast Republicans will need this fall.

Apr 2, 2012, Vol. 17, No. 28 • By YUVAL LEVIN
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Last spring, when House Republicans passed Budget Committee chairman Paul Ryan’s ambitious fiscal agenda, it would have been easy to make two basic guesses about the proposal’s lasting impact: On the one hand, it seemed that the budget’s focus on the immense scope of the fiscal calamity heading our way would put the deficit and debt at the center of our politics for the rest of Barack Obama’s term. But on the other hand, it looked like the Medicare proposal in the budget would be highly controversial and politically risky.

Ryan

Paul Ryan (R-Wisc.)

Jacquelyn Martin, AP Photo

For a time, both predictions seemed to be confirmed by events. The Ryan budget forced President Obama essentially to retract the budget he had proposed two months earlier and replace it with a vague series of promises to address the deficit and debt. There followed several months of budget showdowns, with Republicans setting the agenda, even if they got only a small portion of the spending cuts they sought. Meanwhile, the Democrats were in full attack mode on Medicare, accusing Republicans of pushing old ladies off cliffs and asserting that the defense of “Medicare as we know it” would be the centerpiece of their own election platform.

As the year went on, however, both predictions turned out to be wrong. The case for saving Medicare (and with it the federal budget) from bankruptcy through consumer choice and competition quickly gained the status of Republican orthodoxy​—​with most of the party’s presidential candidates backing it, just about every congressional Republican voting for it, and almost no conservative commentators and pundits opposing it. And voters did not seem to hold it against Republicans, especially when contrasted with President Obama’s proposal to reduce Medicare spending by empowering the Independent Payment Advisory Board​—​a panel of 15 experts​—​to ration care. By November, the New York Times was reporting that the merits of a Ryan-style reform were getting a serious look beyond Republican ranks and “some Democrats say that​—​if carefully designed, with enough protections for beneficiaries​—​it might work.” In December, Democratic senator Ron Wyden of Oregon joined with Ryan to propose a bipartisan version of the idea.

But even as the notion of a market-oriented Medicare reform has taken hold, the intense focus on the country’s fiscal problems has dissipated. The Democrats seem to have realized that their political prospects depended on distracting the public from those problems, rather than on drawing attention to Republican attempts to solve them. So while budget politics dominated much of 2011, recent months have seen a shift of attention toward other subjects​—​especially the question of income inequality. President Obama has been flying around the country raging against millionaires with corporate jets, bands of upper-middle-class college graduates have been occupying public parks to complain about having to repay school loans, and Warren Buffett keeps pleading for a higher tax rate.

It has made for good theater, but it has been completely disconnected from the fiscal realities facing the federal government, and that is exactly how the administration wants it. All the drama has masked a stunning dereliction of the president’s basic duty to keep the government solvent and avert economic catastrophe.

Obama’s 2013 budget, released in February, fails even to propose any means of preventing the coming explosion of debt, and the president’s economic advisers have been remarkably frank about their lack of answers. In a February 16 hearing of the House Budget Committee, Treasury Secretary Tim Geithner was asked by Ryan to describe the administration’s plans for addressing the mounting risk of a debt crisis. “We’re not coming before you today to say we have a definitive solution to that long-term problem,” Geithner replied. “What we do know is we don’t like yours.”

A few months earlier, when Washington’s attention was focused squarely on the coming fiscal calamity, such a stunningly irresponsible statement would have made news. But this winter, it barely registered. It seems clear, therefore, that the challenge for Republicans the remainder of this year is to bring the nation’s foremost economic and fiscal challenges back into focus for the public, to highlight Obama’s failure of leadership, and to offer an alternative​—​a governing vision of their own.

And once again it is of all things a House budget resolution that offers them an opportunity to make their case. If the goal of last year’s Ryan budget was to unite Republicans around a few key reform proposals, the goal of this year’s Ryan budget​—​released on March 20​—​seems to be to highlight the utter failure of President Obama’s vision of government and to propose a plausible alternative.

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