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Ryan Calls Democrat Budget a "Swing and a Miss"

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Date:
Location: Washington, DC


Ryan Calls Democrat Budget a "Swing and a Miss"

Proposal is Rooted in Higher Taxes, Higher Spending, Without Reforms

Wisconsin's First District Congressman Paul Ryan, the Ranking Member on the House Budget Committee, declared his disappointment with the House Democrats' federal budget proposal during committee debate today. The Democrats' plan for the budget would raise taxes by a record amount, and dramatically increase spending with absolutely no strategy to deal with the ongoing entitlement crisis with Social Security and Medicare.

"Republicans and Democrats agree on the need for a balanced budget, the need for sustainable economic growth and job creation, and the magnitude of the entitlement crisis. But the Democrats' philosophy of big government, with more taxes and spending, makes it absolutely clear that we have significant disagreements about the best way to go about achieving those goals. Unfortunately, the Democrats' plan is a swing and a miss on each one," Ryan said.

"Perhaps worst of all, the Democrats' budget passes the buck on entitlement reform," Ryan continued. "All of us have been told by countless experts that Social Security, Medicare, and Medicaid are not sustainable without reforms. And we can not stand idly by while we know that this problem, once dismissed as somewhere off in the future, is already upon us. The first baby boomer has received her first Social Security check, and eighty million more are right behind her. It is fiscally negligent to ignore the glaring entitlement crisis, yet the Democrats' budget does exactly that."

"In recent months, we've seen a host of legitimate concerns in the economy. Growth and job creation are slowing, and many homeowners are dealing with declines in their home's value, combined with rising prices for food, energy and health care. We need to quickly enact commonsense solutions to deal with these problems. The worst thing we could do to a struggling economy - and struggling families -- is to raise taxes. But if we pass this budget, that's exactly what we'll be doing - imposing on the economy, and on every taxpayer - the largest tax increase in American history. And spending will be increasing in lockstep with the higher taxes, resulting in the highest annual increase in debt in our history. At the end of the day, the Democrats' budget would make history in all the wrong ways."

"For these reasons, I will be offering an alternative balanced budget next week, one that won't raise taxes, reigns in spending, and offers sensible reforms to our entitlement crisis. We have an opportunity to change the course of our fiscal future for the better, and my budget will do that."

Congressman Ryan and fellow Budget Committee Member Congresswoman Gwen Moore have offered a bipartisan amendment to express the sense of the House of Representatives that additional legislative action is needed to ensure that states pass 100 percent of child support on to families. By not penalizing families for administrative costs, child support fraud is reduced and participation increases.

Based on the information released at today's House Budget Committee debate and markup of the fiscal year 2008 budget resolution, the following are some of the key points of concern with the Democrat budget plan:

Tax Increases

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Largest Tax Increase in History. Raises taxes by $683 billion over 5 years by claiming automatic, scheduled increases in marginal rates (including elimination of 10-percent bracket), higher taxes on marriage and children, higher taxes on investments, small businesses, and estates, and other tax hikes (current record tax increase is held by the 1993 Clinton tax increase of $240.6 billion over 5 years).

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Holds AMT Fix Hostage to $70-Billion Tax Hike. Contains no permanent AMT fix; and while claiming to protect 26 million additional taxpayers from the AMT for 1 year, the budget merely shifts the scheduled $70-billion tax increase to the subsequent 4 years.

Higher Spending

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Adds $276 billion to the President's budget over 5 years. With $3 trillion plus in annual spending, the Democratic budget solution is to increase discretionary spending above the President's budget by $22 billion in FY 2009 and by $276 billion over the five year period.

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No Earmark Reform. Last year's appropriations bills included 11,737 earmarks with a $16.9 billion price tag. The Democratic budget responds to this problem by funding all existing earmarks, adding $22 billion in FY 2009 spending and proposing no earmark reforms.

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16 Tax and Spending "Reserve Funds". Includes 16 reserve funds, which are mechanisms to increase taxes and spending above the levels proposed in the budget resolution. Last year, House Democrats used reserve funds to pass legislation that would increase spending by $200 billion over 10 years above the budget resolution's levels.

Fails to Do Anything to Rescue Social Security, Medicare & Medicaid

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Does nothing to address Social Security and Medicare's unfunded liabilities of about $38.7 trillion and fails to address the Medicare trustees' recent warning. By 2013, under the Democrats' budget, unfunded liabilities grow to roughly $52.5 trillion.

No Reform, Deficit Spending & Record Debt

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Abuses Fast-Track Reconciliation as follows: 1) jams a $70-billion tax increase to "pay for" a one-year AMT "patch" - though the patch only prevents exposing 26 million additional taxpayers from this tax for 1 year; 2) provides a nominal $750 million in 5-year savings to leverage unspecified Medicare changes with no real reform.

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Deficit Spending. Based on the analysis that the Democrats applied to the President's budget, it does not balance the budget and leaves a deficit of $70 billion in 2012.

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Record Debt. The Democrats' proposal raises the debt this year by $646 billion, the largest annual increase in the debt subject to limit in history.


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