Wash. Post hides the holes in Rep. Ryan's proposed budget
In two August 2 articles, The Washington Post highlighted the purported deficit-reducing effects of Rep. Paul Ryan's (R-WI) economic "roadmap," in one piece misleadingly reporting the Congressional Budget Office's (CBO) "estimate" of his "plan." However, at Ryan's instruction, CBO did not analyze significant tax changes found in his proposal that would likely reduce revenues CBO assumed would be collected.
Washington Post misleadingly touted Ryan's plan as a solution to the deficit
Wash. Post misleadingly reported that CBO "has estimated" the plan "would cut the budget deficit in half by 2020." An August 2 PostPolitics piece reported:"The Congressional Budget Office has estimated that Rep. Paul Ryan's plan would cut the budget deficit in half by 2020. Democrats say voters would not back his reductions in Medicare and Social Security."
In a separate article, the Post advanced Ryan's claim his budget would "fix the problem" with the "completely unsustainable" debt. In an August 2 article, the Post reported:
Instead, Ryan is running a campaign of a different sort, one his party has so far refused to adopt: He is determined to persuade colleagues to get serious about eliminating the national debt, even if it means openly broaching overhauls of Medicare and Social Security.
He speaks in apocalyptic terms, saying the debt is "completely unsustainable" and warning that "it will crash our economy." He urges fellow politicians, and voters, to stop pretending that this problem will go away on its own.
He administers his sermons with evangelical zeal. He will go anywhere and talk to anyone who will listen. When he is not writing op-eds and appearing on television, he can often be found speaking to liberal and conservative audiences alike about his "Roadmap for America's Future," a plan he says would fix the problem.
Wash. Post painted Ryan as an "intellectual" who "[u]nlike most politicians" is working to "bring down the debt." The Post's article was filled with praise of Ryan, repeatedly suggesting that unlike "most politicians of either party" Ryan has produced a serious plan to reduce the deficit. The Post also described Ryan as "cerebral" and as an "intellectual":
Unlike most politicians of either party, [Ryan] doesn't speak generically about reducing spending, but he does acknowledge the very real cuts in popular programs that will be required to bring down the debt.
[...]
He is a loyal Republican, but he is also perhaps the GOP's leading intellectual in Congress and occasionally seems to forget that he is a politician himself.
[...]
Ryan, who represents his home town of Janesville, a small city in southern Wisconsin, does not fit the picture of a typical congressman. He is cerebral and slips easily into academic jargon; he grew up with plans to be an economist.[...]
In 2008, he put out the first version of his budget-balancing plan. It has grown into a voluminous document that includes page after page of minutely detailed charts and tables, and includes a 75-year analysis of how the changes he proposes would affect the federal debt.
[...]
Democrats and Republicans alike praise Ryan as one of the few members of either party to offer a fix for costly entitlements.
Ryan instructed CBO not to account for "significant changes to the tax system" in his plan
CBO: Analysis assumes tax revenues up to 19 percent of GDP under a "current fiscal policy" scenario rather than estimating revenues under his plan. From CBO's January 27 analysis of Ryan's "Roadmap for America's Future Act":
Other Tax Provisions. 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.
Tax Policy Center's Gleckman: "[T]here is not the slightest evidence" CBO's assumption reflects Ryan's revenue proposals, which include huge tax cuts. From Howard Gleckman's February 4 post on the Tax Policy Center's TaxVox blog:
CBO assumed this wonderful outcome would occur only if the revenue portion of Ryan's plan generated 19 percent of GDP in taxes. And there is not the slightest evidence that would happen. Even though Ryan's plan has a detailed tax component, his staff asked CBO to ignore it. Rather than estimate the true revenue effects of the Ryan plan, CBO simply assumed, as the lawmaker requested, that it would generate revenues of 19 percent of GDP.
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Ryan would: turn the current exclusion for employer-sponsored health insurance into a refundable credit; allow people to choose to pay either under the current income tax system or a two-rate, broad-based alternative; replace the corporate income tax with a business consumption tax, and exclude from tax dividends, capital gains, interest, and estates.
We don't have any idea what this plan would do to revenues, but in some ways it resembles former GOP presidential candidate Fred Thompson's campaign plan. TPC figured that scheme would reduce tax revenues by between $6 trillion and $8 trillion over 10 years. Unless Ryan can achieve unrealistically large cuts in spending as well, this is not exactly a roadmap to solvency in my book.
MMfA just didn't like the results.
C'mon, guess.
Could it be via the Wall Street Journal? Or maybe the Heritage Foundation?
And what does this have to do, in any case, with Rep Ryan's constraint upon the CBO to IGNORE any potential tax revenue changes from his suggested budget plan?
That's right, it has nothing to do with it.
Please don't feed the troll post. He's not actually interested in having a reasonable and fair debate about the actual topic - that the Washington Post never mentioned that Ryan told the CBO to ignore a very important part of his budget proposal.
This is way too complicated for you, obviously by your ridiculous response above. Above your pay grade so you post your usual cop out when you have no rebuttal.
If you weren't so entertaining, you'd be pathetic.
You are free to ignore me.
So, yet again, we see you using cropped information out of context to try to make a point to distract us from the real topic!
Some day, you might learn that making yourself look like a paid troll whose job it is to derail conversations IS NOT a good thing. Until that time comes, your distracting troll posts should be ignored.
And because I caught you once again doing exactly that, you couldn't resist another in your string of baseless personal attacks!
Still, all you're doing is making troll posts, trying to derail the topic away from the fact that the Washington Post hid the holes in his budget proposal.
And, on top of that, the utility of that graph is, as has been explained to you multiple times, irrelevant to the TOPIC being discussed here - that the Washington Post hid the potential pitfalls in Ryan's proposal!
I would like to see that graph super-imposed over a graph of the recessions during that same time period. Seems to me the tax cuts coincide with recessions. less taxes + less GDP + same % = more taxes + more GDP + same %.
Which leads one to wonder why taxes were cut in 2001.
It's a hollow complaint from MMfA at best, and sneaky at worst.
The fault doesn't lie with the CBO. Their projections become invalid with the very next law passed by congress or the very next session of congress.
Because....?
You think that the CBO doesn't base THEIR projections on years and years of data?
The problem HERE is that one can't assume, USING those years of data, that 19% is a reasonable number! I already documented that with a link to THE YEARS AND YEARS OF DATA, weasel.
The tax revenue as a percentage of GDP RARELY went above 19%. Out of the last 60 years, it only topped 19% on a couple of years that were outside of Clinton's big years of economic growth.
19% is NOT a reasonable number.
But again, THAT doesn't matter, anyway. The issue is that Ryan's plan wasn't fully scored by the CBO, and so the praise that the Post heaped on it for being a viable solution is unwarranted!
2. The Washington Post can't say what his budget proposal will do or won't do due to the failure of Rep Ryan to ask the CBO to score his tax provisions, yet they DID make those baseless assertions.
This is not rocket science. You are continuing to try to distract from the actual topic here.
And actually, it goes much BELOW 18% at times, and only has gone a tiny bit above 20% a couple of times, and MUCH of the time it's in the 17's, you don't have a leg to stand on here!
The person who is trying to CROP selected pieces of info here to try to make something seem much simpler that it actually is would be YOU, you dishonest paid troll.
It does NOT "hover around 18-20%". You're lying.
And whether it does or NOT is irrelevant in any case. As I said elsewhere, Ryan's plan could actually TOP that 19% average after it's scored by the CBO, and that wouldn't change MMFA's objection here ONE BIT! Teh problem is that the Washington Post HID the potential holes in Ryan's budget proposal by ignoring the fact that he told the CBO to NOT score his taxing schemes!
So, the question from MMFA remains. Why would Ryan insist that the CBO should use a specific revenue percentage that is almost a full point higher than historical levels? Why wouldn't he let the CBO use the tax rates that his own plan cited? Why is he afraid to have his own numbers used?
-- Kurt Hauser, who made a remarkable discovery in 1993 that, even more remarkably, has not been well publicized. As Ranson explains in his op-ed, over the last half century, revenues have remained roughly constant at 19.5% of GDP despite wildly varying tax rates. He calls this Hauser's Law, and shows that it has continued to operate in the years since Hauser discovered it.
Forget about generating more revenue through tax hikes; it won't work. Clinton's big tax increase isn't even visible on the revenue graph, and neither are Kennedy's and Reagan's massive tax cuts. If you want more government revenue, the only way to do it is to grow the economy, which is what supply-siders have been saying all along. -- Hauser's Law
Kinda takes away the incentive for raising taxes...unless one thinks that the tax money is better managed by the Feds...LOL.
No, the way to grow GDP is to grow the middle class. Trickel down has not worked for the last 30 years. It has led to the shrinking of the Middle class, the increase of the poor and increased the difference between them and the top 5%. It has made the rich richer, the poor poorer and ignored the middle class completely.
Over the past 25-30 years, the rich have gotten much richer, and the poor and the middle class have seen their wages and wealth stagnate or decrease.
Proof? You don't have to look any further than that liberal, tax and spend senator by the name of John Kerry. Until he was caught...he had siphoned about $500k from the Mass. treasury...proving that he really believes that higher taxes are good for you but not for him...the backbone of the liberal, tax and spend tenet.
And the way to prosperity is through the middle class.
You can't run a society without taxes.
Yeah here's Reagan Tax miracle and how much it added to the debt
09/30/1988 2,602,337,712,041.16
09/30/1987 2,350,276,890,953.00
09/30/1986 2,125,302,616,658.42
09/30/1985 * 1,823,103,000,000.00
09/30/1984 * 1,572,266,000,000.00
09/30/1983 * 1,377,210,000,000.00
09/30/1982 * 1,142,034,000,000.00
09/30/1981 * 997,855,000,000.00
http://www.treasurydirect.gov/govt/reports/pd/histdebt/histdebt_histo4.htm
What do you think you're showing me with this link?
I already PROVIDED the direct link to this data in my post below!
And YOU already REPLIED to that post BEFORE you posted THIS link to the same data!!
What a tool you are, that you REPLY to my post, as though you READ my post, and then you POST this as though it provides some insight to me? Really?
The typical tax revenue as a percentage of GDP over the past many years is well below 19%. In only a few years in the past 60 did it top 19%.
But none of that matters.
It may be that, if the CBO scored Rep Ryan's proposed budget, the tax revenues would be ABOVE 19%. Or they may be well below that, or their projections may end up right around 19%.
WE DON'T KNOW. And so we can't make ANY fair judgments about Ryan's budgetary suggestions - YET the Washington Post did just that!
This is NOT rocket science!
Yet we see how you CONTINUE to desperately avoid the ACTUAL topic - that the Washington Post was pushing media misinformation that helps the conservative cause by failing to note that Ryan's plan was NOT scored by the CBO WRT its tax revenue provisions!
Fail, then flail.
You're the one who clearly couldn't debunk a thing I said...
... like the fact that you provided a link to data that I had already provided, yet you acted like you were INFORMING me by providing that link.
... like the fact that you REPLIED to the post where I provided that link, yet you act like you're providing a resource that I desperately needed.
... like the fact that the data in that link actually DISPROVES the point you were trying to make - that 19% is a fair estimate of future tax revenues based as a percentage of GDP.
I've refuted everything you've written on this thread about 6 times, as well as pointed out that you're the one trying to distract us from the actual topic.
It's be YOU who failed here, doofus, and everyone can see that.
Par for the course.
And how many of those years had tax rates at the levels Ryan proposed? Isn't that a significant factor? If not, why wouldn't Ryan have allowed the CBO to use his tax rates in their calculations? Why did he specifically request that they NOT use his numbers?
Clearly, Ryan was trying to tweak the results and he was called out on it.
The chart that RO provided proved exactly his point. Through times of high taxes and lower taxes the revenue remained constant as a percent of GDP.
The revenue stream is a function of the economy...not a function of tax rates.
There are several problems with rO's chart.
The first is that it tries comparing total revenues of all taxes with only the top marginal tax rate. However, the average overall tax rate (the blue line) has actually been quite steady:
That's why revenues as a percentage of GDP is constant - the overall tax rate is pretty constant.
There are a whole bunch of if's that have to be looked at in forecasting. If the current pattern of shifting personal wealth upward continues and the current discount on the highest marginal tax rate ends, then revenues will increase because a larger portion of personal wealth accumulated will fall within that bracket. However, if the decline in real income for the middle class that has been going on for years can be halted and reversed, shifting wealth accumulation back to the middle, the increase in the highest marginal rate will have less effect. There are many other scenarios that could be examined, all with different results.
Finally, that chart is dishonestly deceptive. By using that scale (and, it appears, some amount of smoothing) the true variation in revenue as a percentage of GDP looks more even than it is. For example, here is the last 40 years in a more reasonable scale:
Looks a lot different, doesn't it? Not nearly as constant as the other chart pretends it is.
I hope those pictures all come out. It's risky this far into a discussion.
09/30/1988 2,602,337,712,041.16
09/30/1987 2,350,276,890,953.00
09/30/1986 2,125,302,616,658.42
09/30/1985 * 1,823,103,000,000.00
09/30/1984 * 1,572,266,000,000.00
09/30/1983 * 1,377,210,000,000.00
09/30/1982 * 1,142,034,000,000.00
09/30/1981 * 997,855,000,000.00
http://www.treasurydirect.gov/govt/reports/pd/histdebt/histdebt_histo4.htm
Debt is a function of revenue and spending. When we are discussing that scenario you can lay up the debt records of Reagan and Obama.
That graph compares the top marginal tax rate to the TOTAL tax revenues as a percentage of GDP.
WHAT the top marginal tax rate is has little to NOTHING to do with how much we're going to pull in in TOTAL tax revenues.
And, it has NOTHING to do with the actual topic of discussion here - that Rep Ryan's budget proposal was NOT scored on his massive taxing restructuring, and therefore it's unfair for the Post to give him credit when we don't KNOW what his plan will actually DO to the deficit and debt!
There is NO evidence that that top marginal tax rate is directly related to ANYTHING - certainly you are aware that the top marginal individual income tax rate is NOT the only source of revenue for the US treasury, right?
LOL!! Then why are you so bent on raising it?
You really are flailing Sue, you have no idea what you're talking about and even your mouth full of insults can't help you out on this.
The TOP MARGINAL TAX RATE is only one SMALL part of what creates the amount of tax revenue the US Treasury receives, doofus.
You're the one who has repeatedly been shown to have an argument bereft of facts, logic or common sense.
Whether or not I want to raise the top marginal rate has NOTHING to do with your attempt to derail the thread away from the actual topic, which is how the Post didn't give their readers sufficient information about the potential problems with Ryan's plan.
The best rejoinder of the year!!!
RightON wrote "Because the tax rates, no matter how high or how low, are not indicative of revenues, that is the point."
There's NO indication that there's a direct correlation between the top marginal tax rate and ANY level of overall federal tax revenue. There are LOTS of things that go into how much money the US Treasury receives, and there's NO evidence of any direct link between that top rate and how much we get overall - in fact, RightON's OWN CHART PROVES what I said.
And so, yeah, you're right, my rejoinder WAS pretty good. I don't think it was the best all year, by any stretch, but it WAS pretty good and highly accurate!
LOL!
Behold the effectiveness of the Conservative Republican Kool-Aid.
Despite the fact that Revenue = Tax Rate x Taxable income (PERIOD) these righties would have us believe that the two are unrelated. I find it keenly approprioate that this nonsense is based on something called the Laffer Curve - becaue it's complete laffable.
And ScienceBuff (above) has it absolutly right. The AVERGAE EFFECTIVE rate remained ~constant. And RightOn's "point" actually prooves this - revenue as a function of income has not really changed! They get so hypnotized by that top tier number, and never stop to conder that on 1-2% of theountry is paying that at all, and then only the that top portion of their income! This top-tier nonsense is just another way for the super-rich to grab a few million more a year, Government Fiscal Health be damned!
Here's the REAL point RightOn: The TOP TIER tax rate is not indicative of revenues, or for that matter on the AVERAGE EFFECTIVE TAX RATE that people actually PAY!
To say it the way you did is just flat out wrong. And considering how I just said it, one is forced to wonder why you lot are so obsessed with that top-tier rate! The way I see it, unless you make more than $250K per year: YOU ARE BUYING THE LIE. And if you make MORE THAN $250? Then your TELLING THE LIE.
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And that's why I always say that Conservatives only come in two flavors: EVIL and STUPID. One's lying and the other's buying.
"He urges fellow politicians, and voters, to stop pretending that this problem will go away on its own."
Exactly which politicians and voters have been telling him that the problem will go away on its own? Dick Cheney, perhaps?
One theory holds that the country's long-term budget shortfall is "just" an entitlements problem, the result of rising costs associated with growing Social Security rolls and increased health-care spending (via Medicare and Medicaid). Republicans like this idea because it plays down tax increases as a potential solution. Democrats like it because it makes the recent health-care package seem like even more of a triumph.
But it just isn't true. The deficits we face over the next decade reflect a fundamental imbalance between spending and revenue, one that goes beyond entitlements. Based on projections by the CBO, Alan Auerbach of the University of California at Berkeley and myself, among others, even if the economy returns to full employment by 2014 and stays there for the rest of the decade, the continuation of current fiscal policies, including the Bush tax cuts, would lead to a national debt in the range of 90 percent of GDP by 2020. That's already the highest rate since just after World War II -- and Medicare, Medicaid and Social Security aren't expected to hit their steepest spending increases until after 2020.
According to these same projections, the yearly deficit would rise to 6 to 7 percent of GDP by 2020. The Bush tax cuts would account for a significant chunk of this, considering that in each year they are in effect, the revenue lost because of them amounts to nearly 2 percent of GDP.
Compounding the problem: By increasing the government's debt, the tax cuts have already led to higher interest payments on that debt. So even if all of the cuts expire on Dec. 31, we will still be paying for them for years to come.
Wanna know what the "ninny politicians" won't touch? Unearned income of the very wealthiest. Top hedge fund managers earning an average of 2.5 Billion (that's billion with a "B") PER ANNUM, paying 15% on those earnings because of how they are allowed to characterize their earnings.
Keep shilling right CON. You're sandwich coupons are in the mail.
As for SS & Medicare? You're right: The taxes supporting them should be leveid against one's entire income. That would solve the problem overnight.
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Too bad the politicians don't have the stones, huh?
Sure Paul Ryan is an intellectual....in Congress....but when you are competing against James Inhoffe and John Kyl.....you can get into genius territory if you can tie your shoes.
Yet Rep Ryan wants us to believe that we can count on 19% growth?
But the Tax Policy Institute says that those are pie in the sky numbers, and the Washington Post doesn't even question those numbers, but instead goes with the assertion that his budget will help the longterm national debt issue.
Really? We've been talking about the tax revenue equalling 19% of GDP all along, and it's what I was talking about in that very post, yet you couldn't figure out what my last sentence meant, and your ONLY reply to the thorough debunking I did of your bogus talking point was to pretend that you couldn't figure it out?
Really?
I would be like the boy running through the forest of snowy maze at the end of "The Shining".
And everyone else reading this KNOWS that - who do you think you're fooling, dummy?
There was no mind reading necessary to understand what the 19% referred to.
And, again, you failed to refute a THING I had written - your SOLE reply was to PRETEND that you couldn't understand what I meant in a bogus personal attack. And yeah, everyone else reading this knows that too.
Who could have predicted, or planned for, today's economy in 1935? This fool is pretending that he can prophesize a budget for 2085? Of course he doesn't take into account the invention of the intefenarion reactor in 2043, which changed everything, much like computers and the internet did in the 1960's through the 90's. And we are supposed to accord this some actual import?
Jeebus.
The father of supply side join Bruce Bartlett in outing GOP tax policy
This way.
How soon until Rush et al tout Mr. McLane's quote to their radio audience?