Welcome!

News Feed Item

Concord Coalition Welcomes Ryan Budget Proposal But Expresses Doubts On The Details

WASHINGTON, April 1, 2014 /PRNewswire-USNewswire/ -- The Concord Coalition today welcomed the budget proposal from House Budget Committee Chairman Paul Ryan but expressed concern that it does not represent a realistic blueprint for making progress on a fiscal sustainability plan.

"It is the statutory duty of the House and Senate Budget Committees to produce a budget," said Robert L. Bixby, Concord's executive director. "Chairman Ryan thus deserves credit for following 'regular order' by proposing a budget in an election year when some may argue that it would be more convenient to remain silent."

Bixby added: "Ryan has laid out an ambitious but positive goal to achieve budget balance within 10 years. However, like the President's budget, Ryan's proposal is best viewed as a statement of party principle with little chance of moving the fiscal debate forward, much less of being enacted."

Given the size and nature of the structural problems in the budget, the goal of eliminating deficits within a decade sets up some very difficult policy choices. A renewed focus on open-minded budget negotiations -- using policy levers that affect both revenues and spending -- would offer a better chance to enact reforms with a positive fiscal outcome.

The Ryan budget achieves its deficit reduction by cutting over $5 trillion from spending programs. It proposes no revenue increases. The savings would come from repealing the insurance expansion in the Affordable Care Act (40 percent of savings); Medicaid and other health savings (14 percent); reductions in "other mandatory" programs such as food assistance (19 percent); discretionary spending reductions below the current caps (9 percent); Medicare reductions and shifting to premium support (3 percent), and interest savings (15 percent).

The discretionary spending assumption allows defense to exceed the current caps but achieves overall discretionary savings by cutting non-defense spending below the caps. Non-defense discretionary spending would fall to 2.2 percent of GDP by 2024 -- nearly half the amount spent in 2011, when spending caps were first agreed to, and 20 percent less than in 2014. Over the past 40 years, such spending has averaged 3.8 percent of GDP.

One caution in depending on such low spending is that the recent bipartisan budget agreement actually added back some non-defense spending because the 2014 levels were too low to pass appropriations bills through Congress.

"Sticking with the defense caps will be hard enough, even with the increase proposed by Chairman Ryan," Bixby said. "But taking non-defense spending down to the level assumed in this budget is not at all realistic and would greatly reduce the government's ability to make legitimate domestic investments in transportation, education, homeland security and basic research."

Concord also questioned some of the budget's mandatory spending assumptions.

For example, in a glaring inconsistency, Ryan specifically criticizes the President for abandoning a proposal to switch the government's inflation measure to the more accurate "Chained CPI" -- yet the chairman's plan itself fails to adopt that proposal.

One encouraging point, however, is Ryan's opposition to using Social Security's Old Age and Survivors Insurance funds for the Disability Insurance program, which expects to run out of money in 2016. Instead, Ryan calls for a comprehensive fix for Social Security, which should be a top priority for the next Congress.

Achieving the health care savings in the budget is likely to be hamstrung by political rhetoric.

"The Medicare savings included in Ryan's budget -- such as those from the current-law reductions in Medicare Advantage plans and the shift to a Medicare premium support system -- are valid and achievable," said Joshua Gordon, Concord's policy director. "However, fully realizing them will require a break from the current rhetorical stance of many in both parties against the Medicare Advantage financing trajectory and the narrow provider networks and private insurance regulations in the ACA insurance exchanges, without which budgetary savings from premium support would be unlikely."

"Furthermore, the Ryan budget draws large savings from reductions in Medicaid, but it is difficult to see how such cuts won't exacerbate the Medicaid problems of access and low provider reimbursement referenced in the budget's review of the program," said Gordon.

The proposed budget supports base-broadening tax reform bit does not embrace any particular proposal, including the comprehensive plan that House Ways and Means Committee Chairman David Camp recently released. Ryan points to the Camp plan's scored economic growth but does not embrace its policy choices.

As the Camp plan revealed, however, difficult choices are required to broaden the tax base, lower rates, and remain revenue neutral. Camp was not able to do all this and stick with just the two tax rates of 25 and 10 percent that are recommended in the Ryan budget.

A small but growing portion of the assumed savings in Ryan's budget comes from an estimate of its macroeconomic feedback, often referred to as "dynamic scoring." In a departure from the usual practice, Ryan includes a specific macroeconomic score for each year that is then factored into the estimated deficit.

According to this score, the macroeconomic impact in the first three years of the budget would be to add $76 billion to the deficit. From 2018 through 2024, however, the impact would be to reduce the deficit by $251 billion, for a net deficit reduction over 10 years of $175 billion.

The Concord Coalition does not favor this approach in scoring budget resolutions because it introduces even more uncertainty into the projections. It is one thing to give an illustrative estimate of the effects that a particular path of deficit reduction may have on the economy, as the Congressional Budget Office (CBO) has done at Ryan's request. But it is quite another to count that as a year-by-year score.

This is particularly true when specific policy details are absent, as they are in a congressional budget resolution. One set of policy details could have a much different feedback effect than another.

As the budget office cautioned in releasing its economic assessment of the deficit-reduction path in Ryan's budget: "The projections do not represent a cost estimate for legislation or an analysis of the effects of any specific policies….CBO has not considered whether the specified paths are consistent with the policy proposals or budget numbers that Chairman Ryan released on April 1, 2014 as part of his proposed budget resolution."

A copy of this release can be found on our website at: http://concordcoalition.org/press-releases/2014/0401/concord-coalition-welcomes-ryan-budget-proposal-expresses-doubts-details

The Concord Coalition is a nonpartisan, grassroots organization dedicated to fiscal responsibility. Since 1992, Concord has worked to educate the public about the causes and consequences of the federal deficit and debt, and to develop realistic solutions for sustainable budgets. For more fiscal news and analysis, visit concordcoalition.org and follow us on Twitter: @ConcordC

SOURCE The Concord Coalition

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
To Really Work for Enterprises, MultiCloud Adoption Requires Far Better and Inclusive Cloud Monitoring and Cost Management … But How? Overwhelmingly, even as enterprises have adopted cloud computing and are expanding to multi-cloud computing, IT leaders remain concerned about how to monitor, manage and control costs across hybrid and multi-cloud deployments. It’s clear that traditional IT monitoring and management approaches, designed after all for on-premises data centers, are falling short in ...
Without lifecycle traceability and visibility across the tool chain, stakeholders from Planning-to-Ops have limited insight and answers to who, what, when, why and how across the DevOps lifecycle. This impacts the ability to deliver high quality software at the needed velocity to drive positive business outcomes. In his general session at @DevOpsSummit at 19th Cloud Expo, Eric Robertson, General Manager at CollabNet, will discuss how customers are able to achieve a level of transparency that e...
It is ironic, but perhaps not unexpected, that many organizations who want the benefits of using an Agile approach to deliver software use a waterfall approach to adopting Agile practices: they form plans, they set milestones, and they measure progress by how many teams they have engaged. Old habits die hard, but like most waterfall software projects, most waterfall-style Agile adoption efforts fail to produce the results desired. The problem is that to get the results they want, they have to ch...
"Venafi has a platform that allows you to manage, centralize and automate the complete life cycle of keys and certificates within the organization," explained Gina Osmond, Sr. Field Marketing Manager at Venafi, in this SYS-CON.tv interview at DevOps at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
"We're focused on how to get some of the attributes that you would expect from an Amazon, Azure, Google, and doing that on-prem. We believe today that you can actually get those types of things done with certain architectures available in the market today," explained Steve Conner, VP of Sales at Cloudistics, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
For far too long technology teams have lived in siloes. Not only physical siloes, but cultural siloes pushed by competing objectives. This includes informational siloes where business users require one set of data and tech teams require different data. DevOps intends to bridge these gaps to make tech driven operations more aligned and efficient.
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service.
DXWorldEXPO LLC announced today that the upcoming DXWorldEXPO | CloudEXPO New York event will feature 10 companies from Poland to participate at the "Poland Digital Transformation Pavilion" on November 12-13, 2018.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors!
In an era of historic innovation fueled by unprecedented access to data and technology, the low cost and risk of entering new markets has leveled the playing field for business. Today, any ambitious innovator can easily introduce a new application or product that can reinvent business models and transform the client experience. In their Day 2 Keynote at 19th Cloud Expo, Mercer Rowe, IBM Vice President of Strategic Alliances, and Raejeanne Skillern, Intel Vice President of Data Center Group and ...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smart...