By now you might have heard that the Republican budget plan proposed by Rep. Paul Ryan (R-WI) wants to eliminate Medicare as we know it and to give hundreds of billions of dollars in tax cuts to U.S. billionaires —paid for by raising taxes on the middle class and slashing services to families that our economy has left behind. You might also have heard that, in spite of all the pain Rep. Ryan’s plan would inflict on regular families, it makes almost no progress in reducing the federal budget deficit by 2021.
But did you also know that Ryan’s plan will strip bare investments in innovation and competitiveness that are critical to long-run growth and prosperity in the U.S. economy?
Aside from being fundamentally unfair, the Ryan budget plan is bad economics, too. Investment—both public and private—is the most fundamental determinant of economic growth and job creation. Investment boosts productivity and raises living standards for the long-run competitiveness of our economy. Economists across the political spectrum are warning of the threat that cuts to government services pose for job creation and growth in the near term. Most recently, economist Mark Zandi forecast that the Ryan-Republican plan will eliminate 1.7 million jobs in its first two years . But deep cuts to investments proposed in the Ryan-Republican budget plan will also set back the long-run growth and competitiveness of the U.S. economy.
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