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It’s the government spending, stupid

Tuesday, July 27th, 2010

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Here’s what happens when the interviewer is not paying attention to what the interviewee is saying:
Paul Ryan Schools Chris Matthews on Tax Hikes, Budgets and Economics 101

CHRIS MATTHEWS, HOST: Congressman Ryan, is there any tax role for reducing our $1.4 trillion to $1.7 trillion debt this year — deficit this year? Is there any role in tax increasing to help do that job?

REP. PAUL RYAN (R), WISCONSIN: I don`t think it`s a good idea, especially when we`re trying to come out of a jobless recovery in a slow- growth economy.

Look, we have got unemployment at almost 10 percent. The last thing we should be doing is raising taxes on the economy. Look, the worst thing for deficit reduction is a slow economy. You hit small businesses with these kinds of tax rate increases and you will slow down the economy further.

Look, 75 percent of those who will get hit with these higher tax rates are successful small businesses. Tens of millions of our jobs come from these small businesses. Now, if you try to blame these tax cuts and the wars for all of our fiscal problems, the numbers just don`t add up.

At best, 14 percent of the evaporation of the surplus came from these tax cuts. It all came from other circumstances: spending, economic growth declining, 9/11, all these other things.


RYAN: So, I think what Joe earlier said is right, which is these taxes will go up. And I think that`s a mistake. And I think it`s going to hurt the economy.

MATTHEWS: Well, let me ask you one question as a follow-up.

It seems to me every Republican that goes on “Meet the Press” lately is asked, where will you cut? They say nothing. They will not mention any cuts.


RYAN: Chris…

MATTHEWS: No, I have had Congressman Pence on, who won`t say any cuts.


MATTHEWS: So, you won`t cut — you won`t raise taxes and you won`t cut spending.

RYAN: Chris…

MATTHEWS: So, in other words, all this bitching about the deficit doesn`t mean squat, because you won`t do either, raise taxes or reduce spending.

RYAN: Let me answer it, then.

MATTHEWS: Neither one.

RYAN: This year, Congress isn`t even doing a budget, but, last year, when we did a budget, I brought a budget to the floor that specifically cut $4.8 trillion of spending out of the budget and paid for all of these tax cuts and debt reduction. Two months ago, we put out $1.3 trillion in very specifically listed and enumerated spending cuts. So, I can go on with you on cuts. I can show you all the kinds of cuts.

Good answer, right? Here was Matthews’ astonishingly addle-minded response:

MATTHEWS: But that`s one-three hundredth (ph) of the deficit. That`s 0.3 of 1 percent you`ve talked about.

One-three hundredth of the deficit? $1.3 TRILLION?

The lesson continued:

RYAN: Four-point-eight trillion dollars is not .3 of 1 percent of the deficit.

MATTHEWS: OK, 4.8 trillion. OK.

RYAN: And 1.3 trillion is not peanuts.


RYAN: It`s nothing to sneeze at.

MATTHEWS: OK. Let me go.


RYAN: Two things –

From here it became obvious what Matthews was up to. He’s not interested in balancing the budget. He’s certainly not interested in cutting spending.

What he’s interested in is getting Republicans to say what programs they want cut so that Democrats can use that against them in the upcoming elections.

Ryan saw through the charade:

MATTHEWS: I just don`t see — I just don`t see any program cuts. You`re talking in general terms, but let me tell you this: the major Republicans that come on television will not cut Social Security, Medicare, and Medicaid. They won`t cut the military. They can`t cut debt servicing. They won`t — they won`t get rid of a major cost of government.

They`ll talk about, you know, let`s freeze discretionary spending or discretionary and domestic in some sort of generalized way. But they won`t get rid of government. They seem to like government. In fact, they love to talk against it.

RYAN: Go to and you will see a very comprehensive piece of legislation that the CBO has scored that`s actually paying off the debt –

Indeed, this Roadmap was released last week, but I digress:


RYAN: — with specific reforms to the entitlements you mentioned.

MATTHEWS: Name a major piece of the 1.4 trillion to 1.7 trillion. No, just take –


MATTHEWS: — just take a chunk out that 1.4 trillion by getting rid of a big program or good expenditure that people now watching can understand.

Straightforward question. Now watch Ryan give a straightforward answer that Matthews will summarily brush aside like a fly in front of the camera:

RYAN: I would rescind the unspent stimulus funds. I would rescind all the TARP funds that aren`t spent. I would do a federal hiring freeze and pay freeze for the rest of the year. And I would go back and cut discretionary spending back to `08 levels and freeze that spending going forward.

Now, you and I can get into a debate about Keynesian economics, whether it worked or didn`t. I don`t think it did. We increased domestic discretionary last year by 84 percent. I don`t think we should continue to build that kind of a base. Let`s go back and cut discretionary spending back to `08 levels.


RYAN: Rescind stimulus, rescind TARP and do a federal hiring and pay freeze. Those are just a few ideas that add up to $1.3 trillion right there.

Now, let’s understand that at the beginning of this segment, Matthews asked Ryan how he plans on reducing our $1.4 to $1.7 trillion deficit. The Congressman just gave cuts to eliminate $1.3 trillion, and Matthews dismissed it totally:

MATTHEWS: OK. Congressman Crowley, I still don`t see any cuts in entitlements there. But go ahead.

Matthews is just not paying attention. Must be that tingle up his leg acting up again.

Here’s the link to American

If you’re wondering what your tax bill will look like next year, go do the worksheet at the 2011 Income Tax Calculator.