Paul Ryan is heading out of Congress the way he served: with a blizzard of false statements about substantive matters of public policy.
That started with Thursday’s bizarre exit interview with the Washington Post’s Paul Kane, in which Ryan claimed to regret congressional inaction on debt and immigration when he was, in fact, personally responsible for congressional inaction on debt and immigration.
Now comes a tweet in which he offers the view that the policy vision that made him famous — the Roadmap for America’s Future — has been enacted into law under the Trump administration.
When I was chair of @HouseBudgetGOP, we began to change the debate with the Roadmap for America’s Future. Now, all these years later, those early ideas of tax reform have become law and hundreds of millions of Americans are better for it. pic.twitter.com/a099Dl8IL5— Paul Ryan (@SpeakerRyan) November 30, 2018
One can see why Ryan would like to believe that this is true.
The Roadmap was, after all, the intellectual project of his lifetime. And in its pursuit, Ryan did a lot of things (like risking America’s role in the international financial system, harming the economy with ill-timed austerity budgets, and threatening the basic fabric of the American constitutional order by relentlessly covering for Trump) that earned him a lot of criticism. And in the end, basically none of what Ryan advocated for has come to pass.
Trump’s tax bill does not enact Ryan’s tax policy ideas
The original Roadmap for America’s Future, released a bit more than 10 years ago, is conveniently still available on Ryan’s website.
He summarized it as containing four major pillars, of which tax reform was just one. The tax reform component itself he broke down into three bullet points:
-Provides individual taxpayers with a choice: they can continue to pay taxes under the current system, or under a highly simplified code — with just two rates and virtually no special tax deductions, credits, or exclusions.
-Eliminates the AMT, taxes on capital gains and dividends, and gets rid of the death tax.
-Repeals the corporate income tax — currently the second highest in the industrialized world — and replaces it with a border-adjustable business consumption tax of 8.5% — a very competitive international rate.
Now, early in the process of writing what eventually came to be the Tax Cuts and Jobs Act (TCJA), House Republicans did push for the idea of replacing the corporate income tax with a destination-based cash flow tax (DBCFT). But because Republicans refused to try to proceed in a bipartisan manner, this proposal was easily killed by business interests who’d be adversely impacted.
Most of this other stuff just wasn’t attempted. There is no choice between two different tax codes, there is no two-bracket system, plenty of special tax deductions still exist, the AMT was not repealed, and taxes on capital gains and dividends were not repealed. Of Ryan’s stated tax reform agenda, the TCJA fulfills exactly one pledge: heirs to multi-million dollar fortunes are no longer subject to estate taxes, at least temporarily.
And it’s worth noting that while the DBCFT failed because of a toxic brew of interest-group politics and partisanship, the rest of this stuff didn’t happen because, despite the breathless coverage from credulous journalists, the Roadmap was flim-flam from beginning to end. Ryan did not actually write a plan down with numbers that would both fulfill those policy commitments and also raise the amount of revenue necessary to meet the Roadmap’s deficit reduction goals. Instead, Ryan simply stipulated that his tax reform vision would raise revenues equal to 19 percent of the GDP. Since his vision would not, in fact, raise revenues equal to 19 percent of the GDP, it proved totally impossible for legislators to attempt to fulfill his vision.
And this is the part of the Roadmap on which Ryan has had the most policy success!
The rest of the Roadmap is deader than dead
The other planks of the Roadmap shifted somewhat over time in response to political and policy events.
The 2008-vintage plan called for privatization of Social Security, for example, while the 2010 iteration of the Ryan Roadmap simply featured large unspecified cuts. Back in 2008, he wasn’t promising to repeal the Affordable Care Act (since it hadn’t passed yet) and also didn’t seem to be thinking too hard about how his proposed tax changes would wreck the job-based insurance market by eliminating the tax incentives for employers to offer insurance. Later iterations leaned heavily on ACA repeal, block-granting of Medicaid, and a proposal to replace Medicare with vouchers to buy private insurance that would grow steadily less generous over time.
Obviously, ACA repeal did not happen, and in particular the Medicaid cuts that Ryan pushed for in the House versions of ACA repeal fared extremely poorly in the Senate.
Ryan actually could have achieved modest cuts to Social Security and Medicare by embracing Barack Obama’s offer of a budgetary grand bargain, but to get that, he would have had to agree that rich people should pay moderately higher taxes. Ryan refused, and by 2016, even the Republican presidential candidate was promising to avoid any cuts to Social Security and Medicare. With Trump now occupying a position on retirement programs to the left of Obama’s, the Democratic stance has shifted to the left of Trump, and now essentially all Democrats support one form or another of expanding these programs.
Basically none of Ryan’s policy goals were achieved, but rich people did get to pay less in taxes.
Rich people got richer, thanks to Paul Ryan
In arguably the most ridiculous element of his farewell interview with Kane, Ryan whined that “there were a lot of seats in California we should have won and we got massively outspent — if you’ve got a couple of billionaires dropping $100 million on your head, that leaves a mark.”
Democrats did raise prodigious sums of money in the 2018 midterms, largely from grassroots donors alarmed by the GOP’s sudden and expertly fulsome embrace of a man who Ryan himself disavowed by the end of the 2016 campaign. But in terms of billionaires dropping huge checks, it was the Koch network that delivered $400 million while Sheldon Adelson personally spent $55 million.
What’s truly remarkable, however, is that even though $55 million is an awful lot of money, it’s actually considerably less than what Adelson personally reaped from Ryan’s beloved TCJA. His company scored a tax windfall of $670 million in just one quarter, and with a net worth that runs into the many billions of dollars, the estate tax repeal — the one policy goal Ryan actually achieved — will earn his heirs a ton of money.
Sheldon Adelson's company recorded a *$670 million* income tax windfall from the GOP tax law in the first quarter. https://t.co/kuUWPx7YVf— Steven Dennis (@StevenTDennis) May 10, 2018
Most billionaires are not actually especially vocal about public affairs, so public perceptions of what billionaires think are often dominated by an idiosyncratic minority who — like Bill Gates and Warren Buffett — tend to talk a lot about high-minded charitable ventures and espouse vaguely centrist or even center-left political views.
But political scientists Benjamin Page, Jason Seawright, and Matthew Lacombe recently completed the first systematic review of billionaires’ political views, finding “that Buffett, Gates, Bloomberg et. al. are not at all typical.” Instead, most billionaires are “obsessed with cutting taxes, especially estate taxes — which apply only to the wealthiest Americans.” And rather than speaking publicly about issues, “most of the wealthiest US billionaires have made substantial financial contributions — amounting to hundreds of thousands of reported dollars annually, in addition to any undisclosed ‘dark money’ contributions — to conservative Republican candidates and officials.”
These billionaires no doubt wish that Ryan had been successful at advancing a broader range of his ideas. But their No. 1 political priority is paying less in taxes — and especially paying less in estate taxes. That happens to be the one thing that Ryan achieved.