The idea for this post came from Lori Williams. I asked for the deficit and debt comparison tables at the bottom. Numbers are rounded to the nearest $100 billion.
Data is from the CBO Analysis of the President’s 2013 Budget and Paul Ryan's Path to Prosperity.
In Path to Prosperity I found this interesting chart and commentary.
First, Figure 2 makes it very clear that, absent action, Social Security, Medicare and Medicaid will soon grow to consume every dollar of revenue that the government raises in taxes. At that point, policymakers would be left with no good options.
I happen to agree with that analysis, so what does Ryan propose to do about it? The answer is nothing.
Obama vs. Ryan Medicare Proposal
Note that Medicare expenses soar under both Obama's plan and Ryan's plan. Is this the best Ryan can do?
Obama vs. Ryan Deficit and Debt
Notice how both Ryan and president Obama make progress for three years, then nothing for the next seven. Ryan does a better job, but after 10 years of Ryan's proposal, public debt will rise from 11.5 Trillion to $16.1 trillion and that is if Ryan's revenue assumptions come in.
Here's a hint: They won't. Revenue assumptions for both Obama and Ryan will prove to be way too optimistic.
A point of note: Ryan and Obama use a different starting point for public debt, which coupled with arithmetic rounding, explains the slight discrepancy in the first column of numbers.
Path to Prosperity or Path to Ruin?
It's easy to make a comparison to Obama's budget and do better. Indeed it would be hard to do worse, but that does not make Ryan's budget any good.
Ryan does nothing about Medicare and makes the horrendously over-bloated defense budget even worse.
I happen to like some of Ryan's ideas, and hate others, but the overall budget proposal is not fiscally sound.
I would like to do similar analysis of Romney's plan. Unfortunately Romney does not have a plan, only vague promises of miracles, more far-fetched than what Ryan has proposed.
Addendum:
References to "National Debt" above were corrected to read "Public Debt".
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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