There are some congressional Republicans who believe the party’s commitment to supply-side, trickle-down tax policy is in need of an overhaul. Sen. Mike Lee (R-Utah), for example, still wants expansive tax breaks, but believes the cuts should be directed primarily at the middle class, most notably through expansion of the child tax credit.
House Budget Committee Chairman Paul Ryan (R-Wis.), soon to be the new House Ways and Means Committee chairman, wants to make one thing clear: those within his party who question the value of tax breaks for the rich are wrong. The far-right congressman sat down this week with John McCormack.
Some conservatives have argued that reducing the top rate is less urgent now than it was during the Reagan administration, when the top rate was cut from 70 percent to 50 percent and then cut again from 50 percent to 28 percent. But Ryan says that cutting the top rate is “even more pressing now” than it was back then “because the American economy was so dominant in the global economy and capital was not nearly as mobile as it is today.”
Ryan added in the Weekly Standard interview that he’s a “classic growth conservative,” who believes, “Growth occurs on the margin, which is a wonky way of saying, if you want faster economic growth, more upward mobility, and faster job creation, lower tax rates across the board is the key – it’s the secret sauce.”
Even putting aside the fact that Ryan seems to have an odd definition of “wonky,” this is a bizarre perspective. Note, for example, that the failed vice presidential candidate is apparently convinced there’s never been a better time to cut the top marginal tax rate, which only the very wealthy currently pay. The United States is in the midst of another Gilded Age, with massive amounts of wealth concentrated at the very top, but Ryan still demands tax cuts because capital is “mobile.”
As Matt Yglesias noted, “The idea that globalization, which tends to increase the overall size of the economy while also increasing inequality, makes tax cuts for the rich even more urgent strikes me as a little bit hard to defend intellectually.”
At the same time, we’re also learning more about just how much – or in this case, how little – Ryan’s ideology has changed.
In recent months, the Wisconsin Republican has suggested he’s undergone a significant shift. Now, the argument goes, Paul Ryan is committed to addressing poverty.
And it appears, as part of this new approach, Ryan believes the key to improving economic conditions is cutting taxes on the wealthy and waiting for the prosperity to trickle down.
It’s the “secret sauce.”
Note, of course, that Ryan’s previous panic about a “debt crisis” is nowhere to be found. Rather, now that the deficit is shrinking quickly (thanks in part to tax increases on the wealthy), the congressman is focusing once more on tax breaks for those at the top.
This should only be surprising to those who thought Ryan had somehow changed. The conservative Wisconsinite has always assailed the “Green-eyeshade Republicans” – the traditional wing of the party that was focused almost exclusively on the debt and deficit, so much so that it opposed JFK’s proposed tax breaks in the early 1960s – and Ryan is now making clear how little his worldview has changed.