Hey, Paul Ryan's new poverty plan isn't completely terrible!
Too bad Republicans aren't interested in actually passing anything
Rep. Paul Ryan (R-Wis.) unveiled his hot new policy freshness today at the American Enterprise Institute. Given his history of issuing vague, deceptive, and eye-wateringly regressive budget plans, I have to confess that I'm mildly encouraged by this latest one. But while Ryan's proposal is a marked improvement from his previous efforts, I suspect it's going nowhere, not least because his party probably isn't interested.
Let's dig into the details first.
First, the good. On poverty, Ryan amazingly proposed something that might actually work: a large increase in the Earned Income Tax Credit for people without children. As he points out, the EITC is extremely stingy for such people, and pulls almost none of them out of poverty. Ryan also identifies one of the biggest problems with the EITC: that it operates through the tax system, which means that you typically get your subsidies in a lump sum annually, and that these subsidies are hellishly complicated to obtain. His suggestion to include the credit in each paycheck would be an improvement, though he doesn't outline how this might be done.
On the prison system, Ryan also has some decent stuff. He wants to cut mandatory minimum sentences on federal non-violent offenders by half. He calls for allowing judges to more easily hand down sentences below the minimum. And he wants to let people convicted under the old crack sentencing rules to apply for retroactive sentence reductions. He also proposes boosting rehabilitation programs for prisoners (therapy, education, etc.), and opening up opportunities for early releases to halfway houses. It's not half of what I would propose, but it's a start.
Now, the bad. Like every politician these days, Ryan insists that everything be deficit-neutral. And like all conservatives, he insists that we can't pay for these programs by raising taxes. This isn't necessarily a flaw — there are big pots of money in tax credits and deductions, especially rich people welfare like the home mortgage interest deduction. But Ryan proposes to pay for his EITC expansion by cutting other social insurance programs. He would also axe what appears to be the ARPA-E, which invests in renewable energy research, while refusing to touch fossil fuel subsidies.
And as with previous Ryan proposals, there is little quantitative budgetary analysis. It's not clear whether these cuts will be enough to pay for the EITC proposal.
The work requirements that are built into nearly all of these proposals are another major weakness. In a weak labor market, like the one we have today, there simply aren't enough jobs to go around. Demanding that people have one before they get benefits is a recipe for more, not less, poverty.
He also proposes having people on government assistance sign legally binding contracts to make sure they achieve a "life plan." The potentially alarming implications of this bit of condescension — what happens to the people who don't meet their contract? — are largely skipped over.
Ryan's proposal also includes a pilot program to block-grant a slew of anti-poverty programs, essentially allowing the states to decide how such money will be spent. This proposal would probably accomplish little of substance, but more importantly, it would abolish the critical counter-cyclical nature of these programs, as Jared Bernstein explains. Block-granting everything is one of the more inexplicable conservative pet rocks — state governments are often just as incompetent, if not more so, than the federal one.
Finally, Ryan's proposal includes a stipulation that would practically cripple the government's ability to issue environmental regulations. The proposal is downright devious: it would require the government to make a distributional analysis of any new regulation, and submit anything that disproportionately affects the poor to Congress for approval. Pro-poor policy, right? The problem, as Matt Yglesias explains, is that almost every imaginable regulation disproportionately affects the poor, because regulations affect the price of consumer goods. And because Congress can't pass laws anymore, this would basically eviscerate the government's ability to regulate anything — climate change, tainted meat, whatever.
In my view, such a stipulation is a deal-breaker on its own. It's not worth trading our only climate policy for a modest anti-poverty effort with a lot of downsides.
As usual, though, it's hard to know what to make of Ryan and his proposal. It's a vast improvement from his earlier efforts to burn all poverty programs to the ground, but pretty weak considered fully. In a functioning political system, it would offer several opportunities to make some easy bargains with the Democrats to get half a loaf, especially on sentencing and prison reform, which is fast becoming a top liberal priority. But we don't have one of those. Any compromise bill would last about five minutes before it got larded up with angry conservative amendments about Benghazi and light bulbs.
As before, I suspect this will engender a largely pointless conversation between the handful of policy-oriented conservatives and the dozens of eager liberal wonks desperate to have a genuine policy conversation. But the bedrock reality is that most of today's Republicans are almost comically uninterested in substantive policy and tend to despise the poor. That means this proposal is probably going nowhere.