Representative Paul D. Ryan predicted on Wednesday that the two parties would produce “a big down payment†on reducing federal debt this year, yet outlined Republican conditions - chiefly no new tax revenues - that would seem to rule out any budget agreement with President Obama and the Democratic-controlled Senate.
Mr. Ryan, the Wisconsin Republican who is back as chairman of the House Budget Committee after his unsuccessful turn as Mitt Romney’s running mate, gave no clues as to how he can produce a fiscal plan in coming weeks that puts the government on a path to a balanced budget in 10 years as House Republicans, in a big shift, now promise.
His last two budgets took three decades to erase annual deficits, largely because big spending cuts were offset by big tax cuts for high -earners and businesses, and reductions in Medicare spending would not take effect until after 10 years, shielding current beneficiaries and those nearing eligibility.
“We do have our work cut out for us†Mr. Ryan told reporters and policy analysts at a breakfast sponsored by The Wall Street Journal.
The new goal suggests that Mr. Ryan and other Republicans will have to forfeit a big political talking point from his budgets of the past two years - that is, that people over 55 years old would not see any immediate changes in Medicare benefits. That age group includes more voters than any other - voters who are zealously protective of the so-called entitlement programs for older Americans: Medicare, Medicaid and Social Security.
While Mr. Obama and Democratic leaders in Congress have indicated that they could support hundreds of billions of dollars in reduced entitlement spending over 10 years, they have said they would refuse to do so without additional increases in revenues from taxes on high incomes. Having raised top rates as part of a year-end fiscal accord that let the Bush-era tax cuts expire on high incomes, Democrats have said additional revenues c! ould be collected through limiting deductions and other tax breaks for the affluent.
But Mr. Ryan said that he and the House’s top tax writer, the Ways and Means Committee chairman Dave Camp, Republican of Michigan, were drafting legislation to overhaul the tax code that would reduce tax breaks but use the revenue to lower tax rates - not to reduce budget deficits.
Although Republicans resisted the recent fiscal measure that raised the top tax rates, and most House Republicans - though not Mr. Ryan - voted against it, Mr. Ryan said they would embrace the additional revenues - roughly $600 billion over 10 years - as they look ahead to writing budget and tax-overhaul plans. The additional money makes their jobs that much easier, he said.
Mr. Ryan also said he did not expect the Republican-controlled House and the Democratic-led Senate to be able to resolve differences over whatever budget plans they pass this year. “I expect two competing plans,†he said, though ultimately he sid the debt “down payment†would come from negotiations between the White House and Congress.
