Saturday, April 16, 2011

Then and now -- Paul Ryan edition

Jonathan Chait digs up an interesting Robert Novak column from 2001:
The most enthusiastic congressional supporters of President Bush's proposed tax cut consider it much too small, but that's not all. They have reason to believe that government estimators, in both the administration and Congress, are up to their old tricks and badly underestimating tax revenue.

Lawrence Hunter, chief economist of the Empower America think tank, has made calculations that lead him to believe that the Congressional Budget Office has lowballed its estimated 10-year surplus of $ 5.6 trillion. He figures the realistic number is at least $ 1 trillion higher and probably another $ 1 trillion above that. Those numbers not only would permit a considerably larger tax cut than Bush's, estimated to lose $ 1.6 trillion in revenue, but in fact would mandate it.

There are senior Bush policymakers who privately admit that Hunter and his allies in Congress have a point. But these officials claim they cannot change the rules in the middle of the game. Nor can they adjust unrealistic methods that bloat the revenue loss from Bush's cuts. Thus, Washington's high-tax establishment is able to use underestimated surplus projections and overestimated tax losses to claim the country cannot afford the president's program.

"It's too small," Rep. Paul Ryan of Wisconsin, the most junior member of the Ways and Means Committee but a leading House supply-sider, told me. "It's not big enough to fit all the policy we want."
It's possible, of course, to put too much weight on the historical record. Just because we went from deficit to surplus under Clinton and back to deficit under Bush does not mean that Ryan is wrong. It's possible that things are different now, that we should be taking the Bush tax cuts further rather than letting them expire.

But you can't just ignore history either. Ten years ago, Ryan was making basically the same recommendations he's making today based on the same economic and philosophical assumptions. The experience of the past dozen years seems to argue for doing the opposite. That puts the burden of proof squarely on his shoulders.

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