Rep. Ryan: We Have a Spending Problem, Not a Tax Problem

This is a rush transcript from "On the Record," April 28, 2010. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Unless you live in a cave you know we are drowning in debt. What are we going to do? Do you have any ideas? Republican Congressman Paul Ryan says he knows what to do. Congressman Ryan is the ranking member of the House Budget Committee and he sits on President Obama's new debt commission.

Earlier Congressman Ryan went "On the Record."


VAN SUSTEREN: Congressman, nice to see you, sir.

REP. PAUL RYAN, R - WIS.: How are you doing, Greta?

VAN SUSTEREN: I'm very well. All right, this national commission of fiscal responsibility of which you are a member, I want to jump ahead to December 1st, If 14 out of 18 members agree on whatever your final report is, what is going to happen to that report? What is the point of it?

RYAN: Well, the idea of the report is to put our fiscal house back in order and on a better trajectory. If you heard my comments at the opening session, spending is the problem, not taxing. We don't have a tax problem, we have a spending. We need to focus on spending.

And my hope is we come up with real spending controls to get our entitlements under control and spending in order. The president's budget is unsustainable.

VAN SUSTEREN: It is a recommendation. If just sort of says, here's a good idea. Let's try this one, essentially, right?

RYAN: Yes, here's a good idea, let's try this one. And there's an agreement by Majority Leader Harry Reid to bring it up in the Senate. And then if that passes there's an agreement by Nancy Pelosi, the speaker here, to bring it up for a vote in the House. So there's an agreement they will vote on these recommendations if the commission kicks out some recommendations.

And like you say, it needs 14 out of 18 to make a recommendation go forward to then be considered.

VAN SUSTEREN: Our current debt is $12.8, $13 trillion, give or take a few billion, whatever. You say you are in favor of cutting spending.

It seems to me there are three ways to arrive at resolving this. You cut spending, you raise taxes, or you really rev up the economy so we have a lot of money pouring into the government, or some combination of those three. Is that a fair sort of --

RYAN: That's fair arithmetic, right.

VAN SUSTEREN: How are you going to convince everybody in this panel to your viewpoint that it should be cutting spending and not raising taxes? Some of the members might have a vastly different idea now do this.

RYAN: I don't know I'm going to at the end of the day, Greta. It's commission that is not purely bipartisan in that it's stacked with far more Democrats than Republicans. Those of us who are the elected Republicans on it want to emphasize spending.

If you go to my website, you'll see that I put all sorts of spending cut plans out there that pay off our debt. I'm going to be advocating those kinds of ideas.

The way I look at it is the people who sent me here from Wisconsin sent me here to get spending under control so that they don't have their taxes raised. That's how I see my job.

I'm not going to get into table talk as to what is on the table or off the table. The problem in Washington is spending not revenue. Those are the ideas we'll bring to this table, and I hope we can get something out of it. But I'm not sure.

VAN SUSTEREN: In terms of 14 out of the 18, let's say you only get 12 in agreement, then what happens? That's it?

RYAN: Nothing.

VAN SUSTEREN: And so you have at least tried but haven't achieved your goals?

RYAN: I'm hoping we get public education out of this. I'm hoping the course of this year we will bring more education to the public as to the magnitude of this problem, just how out of control our fiscal trajectory is.

And that I think will help educate the public as to what reforms are needed, what tradeoffs are involved, and to help educate congress. I don't think you should try tax out of this problem. Mathematically you literally can't tax your way out of this problem. If you try you will kill the economy. That's why I emphasize going after spending.

VAN SUSTEREN: I have a statement from you dated April 23rd from your office. You say the CBO has realized an analysis as of April 22nd that estimates large tax increases will hit millions of Americans making well below $200,000.

And you go on to say according to analysis by the House Ways and Means committee the president has already signed into law 14 separate violations of his tax pledge. So it doesn't sound like you are being particularly successful in not raising taxes and cutting spending. So it looks like an uphill battle from what you have published.

RYAN: We don't control Congress. I'm in the minority, as you well know. I'm the ranking member of the budget committee, not chairman. That means Congress has passed $670 billion in new tax increase in this session and $1.8 trillion in new spending increases this session. So they've already done a lot of this already.

And I just think we should go in a different direction, and I'm going to be advocating that.

VAN SUSTEREN: One of the other prongs, a way we can get out of our mess is if money comes in if our economy really starts roaring. Is there any indication from the February '09 stimulus bill that the economy is going to get revved up so that maybe we can forestall some of the tax increases or the budget cuts?

RYAN: Not the kind of revved up that you need. Yes the economy is growing. I think the second half of 2010 you will see pretty good economic get, three, four percent. We should have six or eight percent considering the recession we just had.

But most economists think we will slow back down in 2011 because of all these tax increases that are hitting, because of the Federal Reserve slamming on the breaks, stopping up the money supply, increasing interest rates.

So a lot of economists think 2010 is going to be OK but 2011 is going to soften back up. And so we don't see the growth we will need get out of this.

Again, that's why I say spending. The problem is lots of tax increases are coming, more are being proposed. That will hurt the economy's chance of growing and creating jobs. All the more reason to get spending down, because that's in my opinion the only sustainable way to get our budget balanced and pay off debt.

VAN SUSTEREN: I don't mean to be disrespectful to the member who serve on the commission, but is it giving political cover to Washington, because in theory the budget committee in the House has Republicans on it, Democrats on it, and you can discuss these very issues this commission is going to discuss and you can make recommendations.

But instead you have created this sort of -- maybe the word "fiction" is a little crude. But why do you have to have this special commission? Why don't you use your existing structure? You can call witnesses, business people, congress, people who work for the president. Why this outside commission?

RYAN: That's what I've been asking. I actually have a bill that pays off our national debt and balances the budget. I brought a budget to the floor last year that obviously didn't pass that does that, that reduces taxes and cuts spending.

So I think we should do this. That is not where this Congress is going.

What happened with the creation of this commission is the president sent Congress a budget that is unsustainable and not credible. Those aren't my words, those are the words of the budget director and treasury secretary.

And with that budget they said we'll have all these tough decisions to be made by this commission to report after the election. And so what I think it effectively does is it gives politicians up here the ability to defer tough choices to not talk about spending control, and in order to deflect the kinds of criticisms about fiscal mismanagement, just say we've got this commission out there.

Having said that, since I'm on the commission, I want to see it succeed. If there's anything that can help us get a grip on spending I want to see it succeed, and that's what I'm hoping it will do.

VAN SUSTEREN: There's currently no budget, correct? Right now we are operating on no budget. How in the world can you possibly figure out how much spending needs to be cut or taxes raised or even sort of the demands of our federal government if we simply have no budget?

Most families -- when you look at your household you figure out what your budget is. You are now trying to cure the deficit, but you have no idea what our budget even is because we have none.

RYAN: Like I said, Congress just did $670 billion in tax increases, $1.8 trillion in new spending. After all that the new health care law, there is no budget, it doesn't look like they are going to do a budget.

So you need to budget for these things, and that is not taking place right now. I think it is governing 101. Unfortunately, Congress has failed to do this in the past. If the Democrats can't pass a budget is they will deem a number for the appropriations committee to fund government agencies and call it a year.

VAN SUSTEREN: And that's like pulling a number out of a hat, I think, not to be disrespectful. And aside from my flip remarks about it, I do hope the commission is successful in reducing our deficit.

Congressman, thank you sir.

RYAN: You bet.


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