House and Senate Present Budget Plans
House Republicans presented our annual budget blueprint last week, followed the next day by Senate Democrats. The contrast between the two plans could not be more stark.
The Republican plan balances the budget in 10 years, turning our $1 trillion deficit into a $7 billion surplus by 2023. The Democratic plan achieves balance…never. At the end of the 10-year window, the Senate plan would leave the country $566 billion in the red. We cut spending by $4.6 trillion over 10 years; they add $4 trillion to the national debt. The House budget keeps tax rates low, while Senate Democrats call for $1 trillion in new taxes over 10 years. Our plan modernizes the almost 50-year-old Medicare program in order to save it from certain bankruptcy in 2024. Their proposal makes no structural reforms to Medicare, consigning it to inevitable collapse.
This is the first time in four years the Senate has even bothered to produce a budget, so the document’s mere existence represents progress and a starting point to begin negotiations with House Republicans. Beyond that, the plan has little value as a serious policy proposal. Even the liberal Washington Post editorial board criticizes the plan for failing to address the national debt, stating, “Partisan in tone and complacent in substance, it scores points against the Republicans and reassures the party’s liberal base — but deepens these senators’ commitment to an unsustainable policy agenda.”
Not only does the Senate budget fail to get serious about reducing the debt, it actually calls for $100 billion in new “stimulus” spending. By contrast, the House Republican plan recognizes the best way to create jobs and stimulate the economy is by reducing the debt burden and reforming the outdated tax code that makes the U.S. corporate tax rate the highest in the industrialized world.
For those who claim the Republican budget cuts too much, Budget Committee Chairman Paul Ryan has some perspective. Writing in the Wall Street Journal, Ryan states: “On the current path, we'll spend $46 trillion over the next 10 years. Under our proposal, we'll spend $41 trillion. On the current path, spending will increase by 5 percent each year. Under our proposal, it will increase by 3.4 percent. Because the U.S. economy will grow faster than spending, the budget will balance by 2023, and debt held by the public will drop to just over half the size of the economy.”
This emphasis on responsible debt reduction is what sets the Republican plan apart from that submitted by Senate Democrats and from the proposal President Obama will eventually offer – two months past the statutory deadline. Our plan is named the “Path to Prosperity” because America’s future economic strength depends on reducing our $16 trillion national debt. Failing to do so will unfairly saddle our children and grandchildren with an economic burden that will make the current high unemployment and depressed wages a permanent reality.
The Path to Prosperity plan demonstrates that it is possible to balance the budget without raising taxes. It is now the duty of President Obama and Senate Democrats to join the effort to fulfill this vital responsibility.