This is not a post about House Budget Committee Chairman Paul Ryan’s (R-WI) exercise and diet program. It is, however, a post about how he’s planning to produce a budget that gets to balance in 10 years without actually balancing anything.
What Ryan is proposing is the fiscal equivalent of him saying that he wants to lose 20 pounds but isn’t going to counting the fat around his midsection to achieve it.
For weeks the budget and political worlds have been buzzing about how Ryan was going to be able to keep his pledge to bring a plan to the House floor that would balance the budget in 10 years without raising taxes. That’s a substantial task even after the already enacted revenue increases in the fiscal cliff deal and the $85 billion in sequester spending cuts, both of which Ryan has said he will include in his plan. It requires significant and politically very sensitive reductions in Medicare, Medicaid and probably Social Security.
We now know how Ryan’s planning to do it: by balancing the budget without counting interest on the national debt. In economic terms, that’s called bringing the budget into “primary balance.”
In other words, he’s not going to balance the budget at all.
How ridiculous is the Ryan balance-the-primary-deficit-only plan?
Try to imagine a Democrat proposing a balanced budget in 10 years by not counting military spending. That’s the equivalent of what Ryan is proposing to do.
This is not hyperbole. By fiscal 2017, total spending on the National Defense function of the federal budget currently is estimated to be close to what’s projected to be spent on “Net Interest” on the national debt — $590 billion vs $566 billion. As a percent of the budget in 2017 there is virtually no difference between the two.
Bringing the budget into balance without including interest means that the budget won’t be balanced at all. In fact, according to current projections it means that there will still be a $566 billion overall deficit.
My recommendation to Ryan: Don’t have your clothes altered anytime soon.