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GOP's Ryan: Budget 'Exploits The Economic Crisis'

While President Obama's proposed budget rolls through the House and Senate, Wisconsin Republican Rep. Paul Ryan is one of the key lawmakers putting together an alternative plan.

As the top Republican on the House Budget Committee, he will be the one to deliver that plan to the House floor next week. On Thursday, House Republicans released an 18-page pamphlet, "The Republican Road to Recovery," which outlines their break with the president's budget goals.

"We don't think it's right to impose a $1.9 trillion tax increase on our economy during a recession, so we're not going to raise taxes," Ryan tells NPR's Renee Montagne. "No. 2, we don't think it's right to have a huge slew of borrowing — they're doubling our national debt in five and half years, tripling it in just over 10 years. So we think we need to focus on controlling spending and reforming government.


"We don't think the answer is to borrow and spend our way to prosperity, so we're not going to propose all this new spending they're proposing and that's going to help us save money and reduce our borrowing costs."

Some experts do advise spending as a way to lift the country out of a recession, but Ryan says the Republicans disagree.

And, further, he says, "If you believe that spending is the key to creating jobs and prosperity, then it ought to happen right now in the recession. More than half of all of this $1.2 trillion in new spending they're proposing doesn't even occur until 2011 and beyond."

Ryan has referred to the budget plan as "the third and great final wave of government expansion, building on the Great Society and the New Deal." He says there's "probably truth" to the idea that some Americans might think comparisons to the New Deal are good thing — "because that's what President Obama is saying about his budget — that's what the administration is saying is that this is the most sweeping and transformative budget since the New Deal. They probably believe that that's what people want."

But Ryan says unemployment during the New Deal ranged from 12 to 25 percent. "Henry Morgenthau, FDR's Treasury secretary, came to the Ways and Means Committee at the end of that period and said, 'This was a disaster.' It didn't work. We borrowed so much money; we ran up the debt. We didn't get out of the Depression until World War II came along."


Ryan says he thinks those who want a "transformative government" see the economic crisis as an opportunity.

"I think what's really occurring is rather than solving the economic crisis, I think this budget exploits the economic crisis — and grows the size and involvement of our government in levels that are just really historic," he says.

While Republicans are in the minority, Ryan says they can make a difference: "No. 1, we can go to the American people with the truth and tell them what's happening; and No. 2 — and our obligation if we're going to criticize — is to give the American people a choice. And I think we need to reach our hand out to Democrats, especially the 'Blue Dog' Democrats, who consider themselves conservative Democrats, and say, 'Don't sign up to this borrowing spree. Defeat this budget, work with us and let's get something better.'"

One change that has already been made to the budget plan is to get rid of Obama's proposal to set aside $250 billion for any additional bailouts of financial institutions.

"What we think they're up to is they took it out of the proposal so they didn't reflect the cost, but they intend on bringing it to the floor under emergency spending rules, like the original proposal, where it wouldn't be considered inside the budget and, therefore, it wouldn't have to be paid for," Ryan says. "We tried to pass an amendment on Wednesday saying you can't bring this in emergency, the president is already telling us he's going to come to Congress with this request; therefore, it must be inside the budget. We tried to do that and they prevented that from happening."

If the administration did see a need to provide additional bailout money to financial institutions, Ryan says Republicans would have to see what the plan was before he could say whether they would support it.

"You know, we have a new proposal by the Treasury secretary. I have a lot of reservations about that proposal," he says. "I'm pleased in one sense that they're at least attacking the problem, which are these toxic assets. I'm unsure about whether this is the proper method to do it. But in that sense, we will be offering an alternative if we don't think this is the right way to go."

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