Debt Up $6.35T Since Ryan Predicted--in 2008-U.S. Was Headed Toward Bankruptcy

August 11, 2012 - 9:56 AM
Paul Ryan, Mitt Romney

Rep. Paul Ryan of Wisconsin and former Gov. Mitt Romney of Massachusetts in Norfolk, Va., on Aug. 11, 2012, where Romney announced Ryan as his running mate. (AP Photo/Mary Altaffer)

(CNSNews.com) - Rep. Paul Ryan, whom Republican presidential candidate Mitt Romney has picked as his running mate, told CNSNews.com four years ago, in August 2008, that the U.S. was heading toward bankruptcy on the fiscal path it was then following and that it would be “mindboggling” to make the problem worse by adding the sort of health-care plan that then-Sen. Barack Obama was advocating in his presidential campaign.

CNSNews.com asked Ryan: “If our country, if the federal government of the United States, stays on the fiscal path it is currently following, is the government going to go bankrupt down the road?"

“Yes. We know that for a fact,” said Ryan. “All the actuaries, all the objective score-keepers of the federal government are predicting this. So, this much we know. What we know is our government is growing at an unsustainable pace and it will overwhelm our economy’s ability to pay the bills.”

Since CNSNews.com first published Ryan making this prediction on Aug. 4, 2008, the debt of the federal government has grown by $6.35 trillion--rising 66 percent, from $9,565,042,361,845.53 then to $15,915,814,457,919.46 now.

 

Ryan then pointed out that estimates by the Government Accountability Office at that time indicated that the U.S. government already faced $53 trillion in unfunded liability to pay the promises it had made through entitlement programs, including Social Security, Medicare and Medicaid. Each year the government put off dealing with these problems, Ryan said, the unfunded liabilities would increase by $3 trillion. To pay for these government promises without reforming the entitlement programs themselves, Ryan explained, would require imposing massive tax increases on future generations of Americans.

Ryan said he had asked the Congressional Budget Office to calcuate what the tax rates would need to be on Americans of his childrens’ generation to pay for the entitlement promises the government had already made.

“Well, what they told me was really startling,” said Ryan. “They said that the current low rate, the 10 percent bracket for low-income Americans, would have to go up to 25 percent. The middle-income tax rates for middle-income Americans would have to go up to 66 percent. And the top rate, which is what small businesses pay, would have to go up to 88 percent. Those would be the tax rates you would have to if you wanted to tax your way out of this problem. And if you did that, all experts conclude you would literally crash the American economy.”

If we continued down the fiscal road we were on, Ryan said, America would be bankrupted and the children and grandchildren of his generation would be forced into a lower standard of living than Americans have enjoyed in the past.

“What is happening is that these three entitlement programs--Medicare, Medicaid and Social Security—are going to basically to crowd out the rest of the federal budget,” said Ryan. “In about 30 years, they consume 100 percent of the budget. Right now, entitlements are about 60 percent of the federal budget. In about 20 to 30 years, the estimates are that they crowd out 100 percent of the federal budget.

“And we all know that we are going to have an army, we are going to have a navy, we are going to do these other things that the federal government does,” said Ryan. “So, that piles on top of it.

“The point is this: The legacy of this country has always been, each generation confronts the challenges before it so that the next generation is better off,” said Ryan. “With making us safer, by confronting—in the past, we brought down the Iron Curtain and won the Cold War. We got through World War I. We got through World War II. We won the war and Great Depression. The problem we have right now—putting foreign policy aside and our fight with Islamic radicalism—we have an economic crisis, we have a fiscal crisis. And that is, we will bankrupt this country and the best century in America will be the last century.

“Unless we turn our fiscal situation around, and pay off this debt, and change the way these programs work to a more sustainable path, the next generation will have inferior living standards,” said Ryan. “We will not have higher living standards for our children and our grandchildren if we continue down the current path we are on.”

CNSNews.com asked Ryan about the potential fiscal impact of the sort of proposal then-Sen. Barack Obama was talking about to enact a national health care program that guaranteed to pay for health care for people who needed it.

CNSNews.com asked: “If we create a national health care program where the government guarantees to pay for everybody’s health-care if they need it, what is going to happen to this problem?”

“The current government-guaranteed program, Medicare right now, for people over the age of 65 itself is in the hole by $34 trillion,” said Ryan. “So, the current deficit or unfunded liability for Medicare right now is $34 trillion. So, these proposals to basically have Medicare and expand it to cover the rest of the population is mind-boggling given the current program we have right now is so unfunded.”

The Patient Protection and Affordable Care Act that President Obama ended up signing in March 2010—and which Rep. Ryan strongly opposed in Congress—will pay federal subsidies for the health insurance premiums of people earning up to 400 percent of the federal poverty level.

Currently, the federal poverty level for a family of four—two parents and two children—is $23,050. That means Obamacare would subsidize the health insurance premiums of a family of that size earning up to $92,220 per year.