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Dems Step up to the Plate—Finally

After a week of Rep. Paul Ryan’s deficit-reducing budget plan dominating the political conversation, the Democrats have finally responded with a plan of their own. Whereas Ryan’s plan relies on changes to entitlement programs for the bulk of the reduction, the Democratic plan aims to lower the deficit through cuts to mandatory government programs and military spending, while increasing revenue through higher taxes on the very rich. According to the Washington Post, this would reduce the deficit from 8 percent of GDP to 2.2 percent over the next ten years—a sizable reduction, but less than the Ryan plan, which would reduce the deficit to 1.2 percent by 2022 and balance the budget by mid-century.

There are other differences between the plans, to be sure, but in many ways their similarities are the most striking thing about them. Both proposals are in broad agreement that cuts need to be made; they mostly disagree over where exactly the cuts should come from. Gone are the days when Republicans argued for cuts and Democrats argued for expanding the social safety net. Today’s budget arguments are about where and how fast to cut, not whether cuts should be made at all.

Both plans have their good points and their bad points, of course. There’s much room for improvement. But at least both parties have finally put something in writing. Now all debates going forward will have a clear foundation. Let the public debate and the political haggling begin.

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  • NY1

    Professor Mead,

    A few objections to your point that, with the Van Hollen budget, the Democrats have “finally” stepped up to the plate:

    1) Has the budget been, or will it be, scored by CBO, so that we can make an apples-to-apples comparison between this budget and Ryan’s? Here I’m assuming that the minority is allowed to have CBO do this work for it, which for all I know could be wrong. But if the assumption is right, you have to wonder why the Democrats wouldn’t ask for this.

    2) Is there any indication the Van Hollen budget brings the budget into long-term balance? As the Post notes, “documents accompanying the budget resolution do not indicate the proposal would lead to a balanced budget over any time frame.” The Obama budget seems to have taught us that you can bring the debt down to acceptable levels over the next 10 years, and yet still leave the nation on a course for fiscal ruin once the boomers retire at the end of the decade. The Ryan budget (as well as Simpson-Bowles, and some other proposals) at least meets this test. Surely any proposal deserving the “stepped up to the plate” award should pass it?

    3) Let’s wait to see if the Van Hollen proposal gets a majority of House Democrats to vote for it. Then let’s see if the Senate decides to propose and pass any budget (I’m fairly sure we all know the answer to that is no). If the first doesn’t happen, you definitely can’t call this a “Democratic” plan, despite Van Hollen’s endorsement. But even if it does, is it a real proposal of the Democratic party if the Senate doesn’t endorse it, or something similar?

    I say all this as someone who really WANTS to see the Democrats unite behind a proposal that brings the budget into long-term balance. (Though it also hasn’t been scored by CBO, the Congressional Progressive Caucus’s budget, as scored by the Economic Policy Institute, seems to achieve long-term balance. Why won’t the Dems get behind it? My suspicion: it involves tax increases on the middle class). Then we could really have the “public debate” you say should begin. I just don’t think the Democrats have done this yet.

  • Jim.

    I’m not convinced anyone has stepped up to the plate.

    Between now and 2022 the business cycle will hand us another recession. Between now and 2050, we’ll probably have three. If anyone’s economic predictions take that into account, I’d be very surprised.

    Also, interest rates are likely to rise to historic levels; for the Democrats’ plan, this would he especially devastating, and they figure you never actually have to pay off your credit cards, minimum payment forever is OK.

    The best thing that could happen to this country is for us to have two budgets to compromise between– the Ryan plan on the Left, and a budget that actually starts paying off the debt over the next business cycle, on the Right.

  • ljfxg
  • Richard Treitel

    Anybody who thinks he can raise a trillion dollars in the future by imposing taxes on millionaires (and without repealing the law of gravity) is obviously expecting inflation at a rate that will make the value of a trillion dollars in the future equal to that of a few tens of billions of dollars this year. It would also make nearly every taxpayer a millionaire. Aha, maybe that’s the secret.

    More to the point, do a quick search for “Mary Meeker USA Inc” and find out just how little can be done without cutting entitlements.

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