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Monday, March 02, 2009

Congressman Paul Ryan and the Republican road map

The ranking Republican on the House Budget Committee, Paul Ryan, wrote an opinion piece in the Wall Street Journal. In it he blasts Obama for increasing the size of government and proposes four policies to help the economy.

- A pro-growth tax policy. Rather than raise the top marginal income tax rate to 39.6%, it should be dropped to 25%. The lower tax brackets should be collapsed to one 10% rate on the first $100,000 for couples. And the top corporate tax rate should be lowered to 25%. This modest reform would put American companies' tax liability more in line with the prevailing rates of our competitors.

- Guarantee sound money. For the last decade, the Federal Reserve's easy-money policy has helped fuel the housing bubble that precipitated our current crisis. We need to return to a sound money policy. That would end uncertainty, help keep interest rates down, and increase the confidence entrepreneurs and investors need to take the risks required for future growth.

- Fix the financial sector. A durable economic recovery requires a solution to the banking crisis. There are no easy or painless solutions, but the most damaging solution over the long term would be to nationalize our financial system. Once we put politicians in charge of allocating credit and resources in our economy, it is hard to imagine them letting go.

- Get a grip on entitlements. With $56 trillion in unfunded liabilities and our social insurance programs set to implode, we must tackle the entitlement crisis. President Barack Obama deserves credit for his recent efforts to build a bipartisan consensus on entitlement reform. But we can't solve the entitlement problem unless we acknowledge why the costs are exploding, and then take action.

I am glad to see that more and more Republicans are coming out and denying that they are Keynesians. I have great hope that the Republican Party will become a born again free market party.

You can read the rest of the article here.

Posted by Hugh MacIntyre on March 2, 2009 in U.S. politics | Permalink


- Fix the financial sector. A durable economic recovery requires a solution to the banking crisis.
Posted by Hugh MacIntyre on March 2, 2009

No kidding. You've said what you don't want to happen, now tell us what your solution is.

Posted by: The Stig | 2009-03-02 12:41:15 PM

The banks lent too much. Consumers borrowed too much. The only way to fix the financial sector is to cleanse it of its bad debts. The only way to do that is to let them fail. People have forgotten that recessions and bankruptcies are necessary to cleanse the system of bad assets.

Posted by: Charles | 2009-03-02 2:54:32 PM

Ryan is great! I wish the government would implement such a tax plan. The answer to the financial sector problem is no more bailouts. If banks are in debt, then let them fail. Also, dissolve Freddie Mac and all other government run mortgages. In addition, entitlements need to be drastically cut. Unfortunately, the stock market debacle has made privatization of social security less politically feasible. Immediately, increase the social security retirement age to 70 from 65. Also, look at where other costs can be cut. Implementing real tort reform might reduce some health costs by more than 40%(ex: professional insurance for doctors). Also, we might have to look at restricting those eligible for medicare. Finally, I just heard that California spends more than $5 billion in health, welfare, and other government funds on illegal immigrants. I recommend a federal crackdown on illegals and their abuse of our government programs. I would pass a law that would make politicians that declare their locales as sanctuary cities subject to large fines. Finally, I would reverse Obama's efforts to kill welfare reform.

Posted by: Dave | 2009-03-02 10:23:56 PM

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