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Who really killed the Bowles-Simpson debt plan?

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Did Paul Ryan derail the Bowles-Simpson debt commission? That seems to be the meme of the day, thanks to this story in Politico.

Yes, Ryan voted against the plan. But before we analyze his actions back then, let’s recall what President Obama didn’t say back in December 2010 after the debt commission — the commission Obama himself created — released its proposals:

I want to thank the members of the National Commission on Fiscal Responsibility and Reform for their important work in highlighting the magnitude of the challenge before us, and outlining an array of options to confront it. Unfortunately, the plan fell just short of getting enough votes from the commission’s other panelists  to automatically send it the U.S. Congress for a vote.

But it does get my vote. I enthusiastically support the commission’s report and I urge members of Congress on both sides of the aisle to do the same.

The Bowles-Simpson plan is now the Obama-Bowles-Simpson plan and will form the basis of the next budget I submit to Congress. Furthermore, I will be traveling across this great country in the coming weeks and months to talk with my fellow Americans about the budget challenges facing this nation and how this plan meets those challenges.

Is it a perfect plan? No. I think it cuts spending too much and raises taxes not enough. But politics isn’t about perfect, it’s about the possible. And it’s the job of leaders to turn the possible into reality.

Now, what Obama actually did say was this:

I want to thank the members of the National Commission on Fiscal Responsibility and Reform for their important work in highlighting the magnitude of the challenge before us, and outlining an array of options to confront it. …The Commission’s majority report includes a number of specific proposals that I – along with my economic team — will study closely in the coming weeks as we develop our budget and our priorities for the coming year.

Obama, shorter: “I pass.”

He passed even though the plan would permanently raise tax revenues to 21% of GDP vs. their historical average of 18%. That’s an historic tax increase. In fact, the federal government has never in a single year raised that much revenue as a share of the economy. The current record is 20.9% in 1944.

Obama also took a pass even though the commission fully accepted the continued existence of Obamacare.

But those two items, historic tax hikes and government-directed healthcare reform, weren’t enough for Obama to support Bowles-Simpson.

Imagine how much political momentum Bowles-Simpson would’ve had with Obama’s energetic support, given that it did manage a supermajority of votes from the panel — not to mention widespread praise in the media. As it is, Bowles-Simpson continues to provide much of the framework for the current tax and spending debate.

As for Ryan, this bit from the Politico story is crucial to understanding his opposition:

There were attempts at bipartisanship during the commission’s 10-month life. Ryan won credit from both parties for his work with Alice Rivlin, a budget expert appointed by Democrats, on a plan to dramatically overhaul health care. The commission ultimately never considered that proposal.

“The two of them presented their ideas really well,” Gregg said. “If the co-chairman hadn’t gotten this fiat from the president not to reopen health care in any real way, then I think we might have voted for it.

And here is Sen. Tom Coburn, a Republican who did vote for the plan, giving his take on Ryan’s role (via Bloomberg):

Oklahoma Senator Tom Coburn, a Republican commission member who voted for the Bowles-Simpson plan, called “nonsense” any claim that Ryan acted out of political expediency.

“Paul Ryan doesn’t do things politically, he goes out and leads with his chin,” Coburn said. The House Republicans’ “price for a grand bargain was ‘do something on health care,’” Coburn said.

In a Dec. 3, 2010 statement explaining his vote, Ryan said he didn’t support the plan’s blend of defense and non-defense spending cuts, that it “relies too heavily on revenue increases,” and “facilitates an explosive growth of health care spending.”

Obama directed the commission to take a pass on healthcare reform, turning the Bowles-Simpson plan into mostly a tax-hike plan. If the Ryan-Rivlin plan to fix Medicare and Medicaid plan had been part of the recommendations, Ryan might well have voted for Bowles-Simpson given that it would then truly address America’s fundamental fiscal problems. But Obama made sure that was an impossibility from the get go.

How could Ryan derail something that Obama never let leave the station?

UPDATE: If you need any more proof that the plan’s failure would more accurately be laid at President Obama’s feet than anyone else’s, check out this video.

One thought on “Who really killed the Bowles-Simpson debt plan?

  1. What the debt commission should have done is reduce the annual deficit to zero, since our national debt is over 100% of GDP. Then we should start to pay it down to much, much safer levels. There is no justification for a rich nation to be stealing from the future.

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