Ryan Gets It Right on Medical Marijuana

From the AP:

Republican vice presidential nominee Paul Ryan says the federal government shouldn't interfere with states that have legalized medical marijuana.

The Wisconsin congressman tells KRDO-TV in Colorado Springs that he personally doesn't approve of medical marijuana laws. But he says that states should have the right to choose whether to legalize the drug for medical purposes.

In response to a reporter's question, Ryan said: "It's up to Coloradans to decide."

I love his answer. Ryan is consistent on principle here. He recognizes that this isn't a federal issue and the same logic that leads to federal jurisdiction and harassment of medical marijuana use leads to arguments for the constitutionality of the ACA. I hope the younger generation that voted so enthusiastically for Obama, partly on the basis of this issue, now notes the aggressive stance the President's attorneys have taken against local pot dispensaries. Why don't I ever the occupiers complain against the Prez over this?

Paul Ryan's Speech

Was spending some time with family tonight, so not much time for blogging. I made it a point to catch Paul Ryan's speech. It was the speech I wish I was able to give myself. It made the points that needed to be made about crony capitalism and the poverty of thinking that is the ACA. However, I know I'm not a typical voter, so I wondered if it really connected.

The best line in his speech was about the so called Affordable Care Act:

Obamacare comes to more than two thousand pages of rules, mandates, taxes, fees, and fines that have no place in a free country.

The way he emphasized the words free country got my attention. It is that freedom which is under assault, and the left refuses to apologize for its assault on our freedom. Ostensibly, they claim that it is Republicans who want to put "y'all back in chains." But their policies are the true threat to freedom.

To see the quote above, skip to 9:05.

Joe Biden Not Making Sense - Even in Email

Joe Biden sent me this email. I cannot fathom how the message relates to any of the events of the last two days nor to "Romney's Choice," the subject of the email:

From: Joe Biden (info@barackobama.com)

Subj: Romney's Choice

B --

Starting now, we can expect even more wealthy, right-wing ideologues lining up to support the Romney-Ryan ticket.

The people on the other side who are trying to buy this election are putting nasty, deceptive TV ads on the air right this very minute. They're not going away. They're getting worse.

If we don't do what we can to keep this close, right now at this crucial moment, we risk letting the other side run away with it.

If you're thinking about making a donation to the campaign, please don't wait -- donate $3 or more today, and let's win this together.

Every single day from now until Election Day matters. At the end of it, we'll all ask ourselves if we did everything we could to make sure that we are able to keep fighting for change.

I know how I want to answer that question. I hope you're with me -- because we're up against the kind of outside spending never seen before in modern politics.

And without people like you, this could get to be a pretty lopsided fight.

November 6th will be here sooner than we think. Donate $3 or more today:

https://[redacted]

Thanks,

Joe

No thanks, actually. Since you guys are the one's fighting like hell to protect the status quo of big government, which is going broke. Romney and Ryan are actually the ticket of change. Also, what's with the constant request for $3? It seems that every request I get from Team 0 is for three bucks. It must be to gin up some tale about grass roots support, but I have to believe it doesn't actually pay back to process a $3 donation. Hope Doo Doo Econ, my favorite financial guy, can explain.

Air Of Confidence - The Ryan Pick

Romney's pick of Paul Ryan as his VP, ending months of speculation, has me both nervous and delighted. Nervous, because I am by nature conservative about risk and would have gone with Portman or McDonnell from a pure electoral math perspective. It's probably a good thing I am not a candidate for office. I am delighted because this has the potential to be a game changer in a different way that Palin was a game changer (which I still believe was a great pick at the time.) First, this shows Romney's self confidence, which we need. The polls have made me nervous of late. Second, this will bait the Democrats into an all out class warfare and mediscare attack. But the people, even the elderly, are too smart for that too work. They know that the debt bomb is ticking. A debt ceiling limit might hit before the election, creating a crisis. Romney has positioned himself to be the man with foresight when that hits. I have discussed at length how McCain lost the 2008 election because he came across as erratic on the capital market crisis and ended up agreeing with Obama and Bush on the issue. There will be another crisis between now and November; Romney is positioning himself for the win when it happens.

Ryan is also the voice of the next generation. Brother blogger Dean has voiced his belief that a new battle has been joined in which his generation will have to fight for the future of America. Paul Ryan is a member of that generation and young enough to know that without true reform, the federal deficit will wreck his generation's ability to have any semblance of a retirement. Picking Ryan signals that Romney is ready to take on the serious issues of governing that will face this nation in the next four years.

John Fund has an excellent article on his "The Corner" blog at NRO, that discusses some of Ryan's excellent qualities. Leadership is key. One paragraph from Fund:

Third, Ryan’s ideas aren’t that novel or scary. The idea of “premium support” for Medicare, which would change the program’s one-size-fits-all policy to a private-insurance model with public options, was endorsed by a bipartisan commission appointed by Bill Clinton back in the 1990s. Late last year, Ryan announced a new version of his proposal with a new partner signing on: Democratic senator Ron Wyden of Oregon, who first achieved political prominence as an advocate for seniors.

In the video of Ryan's speech after Romney's announcement, Rya hits it out of the park. At the 8:48 mark, he talks to the generational issue that Dean references when he says this:

President Obama and too many like him in Washington have refused to make difficult decisions because they are more worried about their next election than they are about the next generation.

And there is this gem at 14:16. America is more than just a place, though.

America is an idea. It's the only country founded on an idea. Our rights come from Nature and God, not from government. . . . We promise equal opportunity, not equal outcomes.

He states that this idea is under assault, by implication, from Obama. He later states:

We won't duck the tough issues, we will lead.

We won't blame others, we will take responsbility.

We won't replace our founding principles, we will reapply them.

If you ladies would like to show your support you can purchase some apparel like this:

The Challenge of Tax Reform

Paul Ryan's budget proposals are being excoriated by the left. His push for reform is of course laudable, but we should acknowledge that there are some difficulties with the approach he has taken. First the good stuff.

Mr. Ryan wants to avoid a tax increase and reform the tax code because he realizes that the budget will never balance over the long term without economic growth faster than today's 2% a year.
. . .
He has also issued a second budget estimate based on evidence from the 1960s, 1980s and 2000s that tax reform and spending restraint will increase GDP by about 0.5 to one percentage point a year. This means the Ryan budget reduces the debt to GDP ratio to 50% in 10 years from 74.2% this year (and heading higher) and thus steers the U.S. away from the Greek fiscal rocks.
. . .
But what really matters on spending over the long term is entitlement reform, and on that score Mr. Ryan goes further than any Republican Congress or President since 1995. He understands that without converting Medicare into a market-based program with more choices for seniors, and without devolving Medicaid to the states and repealing ObamaCare, tax increases will soon become the political default option.

I agree that reforming entitlements, including social security, not just medicare and medicaid are necessary elements of reform. The Rebublican party needs more Congressman like Ryan.

Ryan proposes a simplified two tier tax system with rates of 10% and 25% and a corporate rate of 25%. He proposes to pay for this with unspecified cuts to tax loopholes. The following chart from the CBO illustrates the relative size of the loopholes, aka tax expenditures, on the budget in GDP percent.

The problem is that every one of these deduction/credits are very popular. What do Republicans propose to remove to make up for the lowered rates? According to Ruth Marcus at the Washington Post, there are about $12 trillion over ten years in such "tax expenditures" and Ryan needs $4.6 trillion over the same period to keep revenue static. However, I'm not sure revenue needs to be static, since Ryan's goal is to reduce the federal government's size to under 20% as it has historically been. Even so, which deduction is the tea party supporter willing to forego?

• Taxing health care benefits makes sense to me, but can you imagine the uproar after Obamacare is repealed or struck down and now we want make health insurance even more expensive?
  
• Do we really want to discourage saving for retirement by taking 401(k) and IRA savings?
• Mortgage interest is very powerful in propping up the prices of homes.
• What about long term capital gains? Don't we want to encourage investing?
• How about state taxes? Doesn't seem fair to pay taxes on money that was taken away by taxes.
• Charitable giving? How are we going to show that we need less government if charities don't step up.
  

These are tough calls. My belief is that we are going to have to go for a package deal that persuades people that they are better off without the deductions in return for lower rates and growth.

Paul Ryan Smackdown of Geithner

Paul Ryan asks Timmy the Tax Cheat about the long term trajectory of the Obama budget. Timmy's response, "We don't have a definitive solution... We just don't like yours." Now there's some leadership.



A graphic from Geithner's own budget report:


A full discussion is available at the American Enterprise Institute blog.

Math not Politics - Fixing Pensions in Rhode Island

Rhode Island has achieved a measure of pension reform, despite being a fairly blue state. From the WSJ:

The plan enacted in November cuts $3 billion of the state's $7 billion unfunded liability by raising the retirement age, suspending cost-of-living increases until the pension system is 80% funded, and even moving workers into a hybrid plan that has a smaller guaranteed annuity along with a 401(k)-style defined-contribution plan.

How did this succes come about? State Treasurer, Gina Raimondo, was able to present the facts to the voters of the state.

"No finger pointing" was her mantra, along with a corollary: "Math, not politics."

I like that last little bit. The state treasurer is a Democrat, but that didn't stop her from recognizing that the state's financial situation was untenable. Perhaps Republicans should de-emphasize blaming the unions, even if we believe they are to blame. The actuarial certainties of our entitlement programs, government pensions, medicare, medicaid and social security, are inexorable. Without change, they will eventually bankrupt us. Democrats can be left to demagogue these issues; but by proposing serious reform, it is actually Republicans, like Paul Ryan, who are doing the work necessary to save the social safety nets in this country.

Just Waiting

Family time tonight, so light blogging. Frankly, I am just waiting for Mitch Daniels to tell us if he is running. I am unhappy about his ethanol stand, but think that a Daniels-Christy ticket crushes Obama-Biden on all fronts. He has a great record other than ethanol and he has the experience necessary, that Obama still lacks even after two years on the job.

But let their be no doubt, Obama is so execrable as President, that I would work to elect Romney, if he were the Republican nominee. I care deeply and passionately about repealing Obamacare. That's going to take a Republican President and a Senate majority. A filibuster proof Senate would be nice, but repeal, by defunding would make me happy.

Saw that Democrats called Congressman Paul Ryan a "coward" for not running for the Wisconsin Senate seat being vacated by Herb Kohl (D). Clear indication that he is being super effective as chair of the House Budget committee. But what babies, as if calling Ryan a name will dare him to do something stupid.

Let The Demagoguery on the Left Begin

When I saw the WSJ Headline this morning, GOP Aim: Cut $4 Trillion, I thought, look out, this will bring out the vitriol from the left. When I read on, that the key to the plan was to remove Medicare as a single payer for the elderly, I knew this would hit a nerve.

First, the facts. Paul Ryan is going to release a plan that would move those currently under 55 into a "premium support" system rather than to Medicare as it is currently structured. This will shield the federal government from the skyrocketing costs of the program, but will end Medicare as we know it. Cue the howls, the Republicans are ending Medicare. True enough, but if a better and more affordable way to insure seniors can be found, what difference does it make. Frankly we can not afford the current system, given the trends.
Will seniors have to do a better job saving for and managing their own health care? Yes. Why is that a bad thing? Market competition, while not a panacea is certainly preferable to the current system that is rife with fraud and is slowing falling apart as doctors opt out and the queue gets longer for the ones that remain.

Over at DailyKos, the focus is on the fact that this ends Medicare, as if calling it a sacred cow will save it from the inexorable economics that are already killing it. Josh Marshall of TPM is quoted:

The Ryan plan is to get rid of Medicare and in place of it give seniors a voucher to buy health care insurance from private insurers. Now, what if you can't buy as much as insurance or as much care as you need? Well, start saving now or just too bad.

The Republican rebuttal to this tripe is that if the current system isn't dramatically changed, then seniors will have zero health care help from the government. It is a strong man argument, comparing a still functioning system of today against Ryan's proposal, when the actual comparison is against a bankrupt system that helps no one once it goes bust in the future.

E.J. Dionne, another reliably lefty writer, is also quoted in Kos from his WaPo article.

Will President Obama welcome the responsibility of engaging the country in this big argument, or will he shrink from it? Will his political advisers remain robotically obsessed with poll results about the 2012 election, or will they embrace Obama’s historic obligation — and opportunity — to win the most important struggle over the role of government since the New Deal?

He is asking the President to act irresponsibly, as if the party will never end, and risk his re-election on the hope that the public will buy into the shrill messaging of years past. But I think we are beyond that. The Tea Party has educated the public, they are ready to deal with this.

Exit questions. Is this a political winner for Republicans? Will Obama lead a spirited counter-offensive in defense of all things governmental?

Addendum on Paul Ryan and the Deficit Commission

I didn't fully understand why Paul Ryan objected to the Deficit Commission recommendations, but I published his video yesterday anyway, because he has a good reputation as an "anti-progressive." (In this day and age, could there be a more reverential honorific?) Today's WSJ gives more detail on why Paul Ryan made the right move:

Longer-term, the problems are the liberal entitlements of Medicare, Medicaid, Social Security, and, starting in 2014, ObamaCare, which will add about 20 million to the Medicaid rolls. Democrats want to keep these programs as they are and pay for them with much higher taxes—first by balancing the budget at 25% of GDP, and later by necessity at 30%, 40% or more. The alternative—which we support—is to reform the programs and reduce their scope.

Yet, incredibly, the Simpson-Bowles report has almost nothing to say about the runaway health-care entitlements. This is a bow to the left and the White House, which cut Medicare by $500 billion to finance a corner of ObamaCare and wants its signature achievement untouched. But this is like doing a Pentagon budget review and excluding Iraq and Afghanistan. Republicans ought to reject the report on those grounds alone

This is the key failure of the commission, and why its work, however worthwhile, doesn't go far enough in addressing the key problems at hand.

Look at the graph from my previous post on this subject and you see that without addressing social security, and medical entitlements there is no long term hope for deficit reduction. My biggest fear is that a short term recovery, which seems to be in the offing, will remove the sense of urgency over the issues at hand. I am a firm believer in the long term prospects for America, but the debt issues are going to take a decade to work out, IMHO. If a recovery gives some breathing space, we better use it to repair the balance sheets of the federal government.

A not small consolation in this whole exercise was that using the commission as a stealth means to get a VAT into the political discussion never happened. No wonder the Democrats have little good to say about the commission.