U.S. Representative Paul Ryan, the Wisconsin Republican who is chairman of the House Budget Committee, said President Barack Obama’s plan to reduce the federal deficit is “hopelessly inadequate” and may make it harder to reach bipartisan compromises on fiscal issues.
“What we heard was a partisan broadside from our campaigner in chief,” Ryan said at a news conference after Obama’s speech on the deficit today in Washington.
Ryan earlier this month proposed a budget that would reduce the deficit through spending cuts of $6 trillion over 10 years and phase out the traditional Medicare program for seniors. He said he was “naively optimistic” that Obama’s speech on reining in the deficit would give Republicans “a sincere olive branch to get things done.”
Ryan expressed disappointment at the president’s position on Social Security, saying he thought that was an area where the two parties could find some common ground.
“All we got is what he won’t do, not what he wants to do,” Ryan said.
In an interview just before Obama’s speech, Ryan held out hope that lawmakers may be able to find agreement on revamping Social Security’s long-term funding while casting doubt on the chances of a “grand bargain” on the federal deficit.
“Everybody keeps asking if we can get some grand bargain, like it’s a grand slam -- let’s just try to get some singles and doubles,” he said before Obama’s speech.
A bipartisan group of senators known as the Gang Of Six has been working on a broad plan to reduce the deficit.
“We just have such difference of opinions on health care,” Ryan said in the interview. “But on Social Security, from just listening to the various Democrats and Republicans around here, we’re not worlds apart.”
Obama mentioned Social Security in his speech, though he didn’t focus on restricting it. “While Social Security is not the cause of our deficit, it faces real long-term challenges in a country that is growing older,” he said.
“As I said in the State of the Union, both parties should work together now to strengthen Social Security for future generations,” the president said. “But we must do it without putting at risk current retirees, the most vulnerable, or people with disabilities; without slashing benefits for future generations.”
Although the Social Security program is spending more on benefits than it receives in revenue, its trust fund will not be exhausted until 2039, according to the Congressional Budget Office.
‘Poison the Well’
Ryan’s budget doesn’t propose cutting Social Security, though he said that was only to leave room for compromise. “We felt that if we put an actual plan in there, it would just be too tempting” for Democratic leaders “to go after us on, poison the well, make it harder to come together,” he said in the interview.
Ryan said Social Security is “not the big driver of our debt, but it would be symbolically huge to build confidence in the markets to fix one of the entitlements that are going bankrupt as a down payment on pointing us in the right direction.”
Asked if he believed Obama’s speech was in reaction to his budget plan, Ryan said: “Everybody says it is -- I don’t know, the president can answer that question.”
He also said, “I do find the timing of him feeling the need to do a budget speech after we put our budget out probably more than a coincidence.”
Ryan’s proposal for the Medicare program for seniors would replace it by providing those under the age of 55 with subsidies to buy private health insurance.
Obama and other Democrats have rejected that plan. In his speech, Obama said that under Ryan’s proposal, “instead of guaranteed health care, you will get a voucher. And if that voucher isn’t worth enough to buy the insurance that’s available in the open marketplace, well, tough luck -- you’re on your own. Put simply, it ends Medicare as we know it.”
Obama today called for cutting the deficit by $4 trillion over the next dozen years through a combination of spending cuts and tax increases.
Ryan and other Republican leaders have rejected the tax increase proposal. “If we are going to resolve our differences and do something meaningful, raising taxes will not be part of that,” House Speaker John Boehner, an Ohio Republican, said today.
In the interview, Ryan said that a looming debt limit vote may be the only vehicle lawmakers have this year to make significant changes in the government’s long-term spending, which means that they wouldn’t have much time to hammer out an agreement. The Treasury Department predicts that the government will reach the legal cap on borrowing by May 16. After that, the government will have some accounting moves and other steps to avoid default into early July, Treasury Secretary Timothy Geithner has said.
© Copyright 2017 Bloomberg News. All rights reserved.