EDITOR OF REDSTATE
I have reservations with Paul Ryan’s “Roadmap”
I like Paul Ryan. He is an above-average conservative who can often articulate good policy, even though his actual voting record sometimes does not reflect his conservatism. These days his “Roadmap” is all the rage in conservative policy circles, and people continue to ask me what I think about it.
To be sure, the Roadmap has some very good ideas in it. Personal accounts within Social Security, an optional two-rate flatter income tax, and the sort of entitlement reform that turns Medicare and Medicaid into defined contribution programs. Outstanding.
But unfortunately, the plan makes some extremely questionable strategic decisions, which given the fact that it is meant to be “comprehensive” in nature, make it difficult for me to support as a whole.
For instance, the plan includes a “business consumption tax”, which is basically a value added tax (VAT), though Roadmap fans like to quibble with that fact. A VAT makes it extremely easy for governments to raise taxes without the citizenry knowing it. What employer withholding did to make it easier to raise income taxes, the VAT will do to make it easier to raise sales taxes.
A lot of economists love the idea of a VAT, but we should be extremely leery of such a tax as its very efficiency makes it so difficult to ever control. A government that has spent 200+ years growing outside the bounds of the constitution will only take days to grow outside the parameters of a VAT. It will evolve, grow, and poison us. Only a fool should dare think a VAT can be kept small once given to the federal government.
Now Ryan would be quick to argue that his VAT is a replacement for the entire corporate income tax currently on the books and would not be hidden in the way that many “European-style” VATs are structured. In a perfect world, maybe that might make sense, but by conceding that a VAT is acceptable, Ryan makes it much more difficult to oppose the Obama Administration’s VAT plan that is being considered as part of the deficit commission that he himself is representing Republicans on. The Roadmap has essentially compromised his effectiveness to block a European-style VAT.
Also, until the 16th Amendment is repealed, an income tax once repealed can always rise again to join the field with the taxes that had replaced it. That doesn’t mean we conservatives ought to shy away from repealing the income tax, but we must ensure that no new types of taxes spring up until the income tax is finally put to rest.
Another major problem with the Roadmap is that it is not aggressive enough on spending. For all the talk that it encapsulates all the hard choices needed to get our fiscal situation under control, the budget would not be balanced until 2063. Spending does not return to its post-WWII historical average of around 20% of GDP until 2058.
One other glaring problem now is that the Roadmap was written before Obamacare was passed. That throws off a lot of the assumptions and calculations. Paul Ryan is in the “repeal and replace” camp instead of the “repeal and start over” camp, so he is not going to want to totally scrap it without something to immediately replace it with. Therefore, I would think parts of the Roadmap are going to need to be rewritten to be relevant in the present policy and political climate.
Now does that mean that we shouldn’t pursue a lot of these reforms? Of course not. But if this is our “comprehensive” plan for America, no thanks. It is not good enough. For example, as I’ve written before, the Republican Study Committee put forward a plan that would balance the federal budget within ten years, while making no reductions to Social Security and still allowing Medicare and Medicaid to grow each year (although significantly slower). It also pairs back much of the non-entitlement discretionary spending that is easier to cut, whereas the Roadmap just assumes a freeze. It’s tough medicine, but its what we need in this environment.
Why didn’t Ryan go further? I don’t know. My guess is that he didn’t think he could sell going further without losing some credibility with the Beltway propeller heads or whether he understandably lacked the expertise in certain subjects. Maybe he just didn’t want to.
But here is an overarching concern.
As National Review’s Ramesh Ponnuru noted, “I do not think that Rep. Ryan’s plan should become the Republican plan for addressing health care, entitlements, and tax reform, because I don’t think that the appropriate response to overreaching liberal comprehensivism is overreaching conservative comprehensivism.”
I share that concern, to some extent. I still hope that Republicans propose big and bold ideas that will actually fix the country’s problems (so far they have not), but I worry that this Roadmap, because it attempts to be so “comprehensive,” will lock conservatives into strategic decisions for the next 75 years that are not in our best interest in our battle with the left.
What if conservatives think it best to avoid touching the benefit structure of Social Security in order to get personal accounts enacted? The Roadmap boxes us in. What if conservatives reach a consensus in opposition to a VAT? The Roadmap supports one, though Roadmap supporters will quibble that it is not really a VAT even though at its essence it is one. What if we dare to call for balanced budgets? Well, the Roadmap just doesn’t think its necessary, and yet that is the road we’ll be on.
Paul Ryan is a wonk, and he is a good one, albeit one who has been in Washington for a long time. But I don’t think that conservatives have to assume that the Roadmap with its inherent tradeoffs is The Conservative Plan From On High for the next several decades.
The Roadmap is not infallible. It is a great start. It does very many good things. But I cannot embrace it as the be-all end-all for the Republican way forward and I would urge others to use caution too.