Paul Ryan Breaks Down Under Wonkterrogation

By Jonathan Chait, New York Magazine

28 January 13

aul Ryan's great genius has not merely been that he has united conservative Republicans around a single vision - several Republicans have done this before - but that he has simultaneously persuaded moderates that he shares their beliefs as well. That is how Ryan has pitched himself to America, not as a right-wing ideologue but as a thoughtful numbers guy. Literally every piece of evidence in Ryan's career - from his formative infatuation with Ayn Rand to his indoctrination in the works of supply-siders to his mentorships under Jack Kemp and Sam Brownback to his entire voting record in public life - says that Ryan is a hard-core supply-sider whose overarching goal is to reduce tax rates on the rich, far more than it is to bring budget deficits to heel. Nevertheless, Ryan has managed to persuade legions of moderates and moderate conservatives - see James Stewart, Ruth Marcus, and Ross Douthat, to take a few examples - that he is secretly willing to raise tax revenue as part of some bipartisan agreement.

Ryan usually manages to elide the contradiction between the irreconcilable hopes placed in him by evading questioning, using weasel words, or just filibustering long enough to exhaust the topic. That's what makes his talk Wednesday with Ezra Klein and other reporters so interesting. Ryan tried to evade the question, but Klein wouldn't let him until Ryan had made it perfectly clear he would not accept higher revenue at all, under any conditions.

The conversation is worth close examination, because Ryan simply hurls up nonsensical rationales one after another, and finally offers his actual reason when he has run out of gibberish. Ryan begins by pledging his abiding fear of a "debt crisis," but insists he won't accept higher revenue, even in return for spending cuts. Ryan replies:

"They already got their revenues," Ryan said. "So what, we'll roll over and they get more revenues? That's not how it works. In the spirit of bipartisan compromise, they've gotten revenue increases already. We've yet to get anything as a result of it. It used to be 3 to 1. Isn't that what Erskine says? $3 of spending cuts to every dollar of tax increase. The president in his own budget last year claimed 2.5 to 1. We'd argue with whether they actually achieved that, but where's the 3? Where's the 2.5? Where's the $1.8 trillion in cuts?"

It is true - there was a $620 billion tax increase at the beginning of the year. On the other hand, there were $2.2 trillion in spending cuts in 2011. So you could just as easily say Republicans already got their spending cuts and there should be no more, right? Ryan replies:

"That was last session," Ryan said. "We're going forward now."

In fact, the $620 billion was also last session. In any case, notice how fast Ryan has flipped his logic. First he asserts that there can't be more revenue because we already increased some revenue. When reminded that we cut spending even more, he says it's "last session" and irrelevant. I did not attend this meeting, so I don't know how many seconds passed between Ryan insisting that a budget agreement in the last Congress inherently rules out a similar action and Ryan insisting that agreements in the last Congress are totally irrelevant to what happens going forward. It couldn't have been many.

There's more! Klein then asks what evidence he has that taking "another $600 billion or $700 billion out of tax expenditures" would harm the economy. Tax expenditures mean eliminating tax deductions for specific things, rather than raising rates. Here's Ryan's reply:

"I think rates matter," Ryan replied. "I think the statutory rate matters at the end of the day."

Note that this is not the premise of the question at all. He was asked about reducing tax deductions, leaving rates in place, and stated he wouldn't do it because he likes low rates.

Klein then transcribes the resulting exchange:

"But you could have the same or lower rate there," I said. After all, if you're closing loopholes, the top marginal tax rate doesn't change.

"I don't know about that," said Ryan. "Remember, we have to write these things statically. We don't use macroeconomic feedback on the Joint Tax Committee."

"But if you capped deductions at $15,000," I pressed, "that wouldn't change rates."

Ryan didn't budge. "You have to decide where you want to cap deduction or which deductions stay or go, what will pass, and what the resulting rates will be.

Here Ryan is descending into word salad, which impresses observers because he is using terms that pertain to tax policy - "statically," "Joint Tax Committee" - but he is not using them in a way that makes any sense. The fact is that you could increase tax revenue by capping deductions, without increasing rates, or even with lowering rates. Ryan would know - he ran for vice-president promising to do exactly that! Here's Paul Ryan explaining how the thing he now derides as impossible would work:

Rather than raise tax rates on individuals and businesses that are the source of job creation and economic growth in America, here's what I would propose as an alternative: Take away their tax breaks. Take away the deductions, take away the loopholes. By taking away tax loopholes, which primarily benefit the well off, which are Washington picking winners and losers in the economy, what we're doing is subjecting more of their income to taxation, albeit at a lower tax rate.

The difference, of course, is that Ryan and Romney wanted to take all the revenue they raised and use it to reduce tax rates. Democrats are suggesting instead to use some of the revenue to reduce the deficit, in return for spending cuts. Ryan now says it can't work - that you can't reduce tax expenditures without raising rates.

Ryan proceeds to insist he won't trade revenue for spending cuts because such a deal is inherently a trick:

The other problem I've noticed - and this is just experience from my fifteen years in Congress - every time you give a little revenue, it just goes to spending. The spending cuts are always later and the revenue gets pocketed. It's one of those fool me once, shame on you, fool me twice, shame on me.

In fact, as Klein notes, Ryan's belief that revenue just gets "pocketed" is false. But you don't even need evidence to see that. It's silly as a matter of logic. Ryan is arguing for getting Obama to agree to spending cuts. He obviously thinks those cuts are real. Would it somehow make the cuts not real if they're attached to revenue increases?

[Update: I have a transcript now, and Ryan was asked this very thing. ("If you have a bill that has real spending cuts in it and you add $700 billion of revenues, does that mean that the spending cuts aren't real anymore?") Ryan's reply: "Well, look, I'm not going to get into that." Yes, why get into the inherent logical fallacy that undergirds your entire argument?]

Ryan then circled back to his "we already increased revenue" point, and then got to his real position: "And by the way, I think that revenue level is way too high, I don't see how you get there." After that, he changed the subject to corporate tax reform, where both sides want a revenue-neutral overhaul, which is therefore irrelevant. But the final confession is the tell. Ryan opposes more revenue because he thinks revenue is too high. He would like to cut spending, but keeping taxes low is the maximal priority.

Ryan understands that he can get much further by pitching himself as an opponent of debt rather than an opponent of taxes. So he will go pretty far to avoid explicating his actual legislative stance. But that is Paul Ryan's position. If you like Republican anti-tax orthodoxy, you'll like Paul Ryan. (Ryan mentor and current Kansas governor Brownback is currently implementing a plan, also set out in the first and most explicit version of Ryan's budget, to raise taxes on the poor while cutting them on the rich.) If you think Ryan's the guy to change that orthodoxy, you're kidding yourself.