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Paul Ryan Talks 2012, Town Hall Protesters, Medicare, Tax Reform, and More!

8:00 AM, Apr 28, 2011 • By JOHN MCCORMACK
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"I’m not even going there," Ryan replies. "I’m not even going there with my mind or my discussions. I’ve been pretty clear about this stuff with folks. I think the field’s going to keep emerging. I have no doubt somebody who’s running for president sees the true nature of our fiscal condition, they’ll come to the similar conclusions about how best to fix it, if they’re a conservative."

But at the very least, is Ryan willing to consider being the vice presidential nominee--for Donald Trump? "No comment," he says with a laugh. (He was similarly tight-lipped when asked when he'll release his long-form birth certificate: "I have no comment... You know, my mom has it, I think.")

Ryan also discussed some criticism his Medicare reform has faced from Democrats. For example, Alice Rivlin, Clinton's OMB director with whom Ryan has collaborated in the past, has said that the growth rate of the proposed Medicare subsidy is too low. 

"I think that’s a very debatable, reasonable and negotiable point," Ryan says. "She likes the structure of premium support. She still believes that premium support is the way to reform Medicare."

And what does Ryan make of the comparisons between his call for a subsidized Medicare health care exchange and Obamacare's exchanges? 

He offers a thorough response:

Medicare already has exchanges. Medicare prescription drug benefit is an exchange. Medicare supplemental is an exchange. Medicare Advantage is an exchange. So Medicare already operates like this. So we’re not talking radical change about how Medicare operates.

Doing that for the under-65 population—a federal government-run exchange—is radical and is dramatically different from where we are today for the under-65 population—point number one.

Point number two: Medicare is a much more unique population with high health care costs… health problems. The under-65 population is not. … What we want is to have a more vibrant, innovative market for health care for the under-65 population, and that will help produce a better system for the over-65 population.

If you turn the entire health care system into a government-run system, you won’t have the choice, you won’t have competition, you won’t have innovation, and productivity improvements. So the Medicare reforms are very similar to the way Medicare works in many aspects, but doing that to the rest of population would deeply damage the entire health care system and take a lot of freedom away from people who have it right now.

On tax reform, Ryan says he wants to lower all tax rates but keep revenues the same by eliminating or reducing deductions. While the Ways and Means Committee will hammer out the details this summer, I ask Ryan if he can say whether he can offer just a few examples of what's likely to happen. Will the mortgage interest deduction be reduced or eliminated?

"I’m not trying to beat around the bush," Ryan says. "I just don’t know. Yes, we go down the same path that the [Simpson-Bowles] fiscal commission does, broadening the base lowering the rate. But we’re targeting the historic revenue line of 18.3 percent. They’re targeting 21 percent, and then another trillion on top for deficit reduction. They had to target a far higher revenue line than we do, so there’s more room within the tax code along deductions for us to look at and achieve these rates. So we want to figure out through hearings and research what’s the best way to do that. We have more room to play with among the broader based deductions."

Simpson-Bowles also proposed taxing capital gains as ordinary income. Is that something Ryan would consider as part of a tax reform package?

"It depends on what the tax rate is," he says. "The key is that you don’t have a high tax on capital gains.... Raising capital gains rates to the income tax rates we have today would be a disaster."

Looking ahead to the next big congressional battle over raising the debt ceiling, Ryan says: "We want to use our leverage to get real spending controls to address the reason why the debt ceiling is being hit in the first place." 

Are Republicans raising expectations too high and setting up conservatives for disappointment on what may be achieved in terms of spending cuts or caps tied to the debt ceiling vote? "I don’t think most people believe that we’re going to get the Senate to address it, sign it into law, everything we’ve always wanted as part of the debt limit," Ryan says. "But I do think they expect us to get a good downpayment on fiscal controls and spending reforms. I think that’s reasonable."

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