The seventh-floor auditorium at the Heritage Foundation was sardine-box-stuffed with interns, staffers, and reporters who had been promised a speech equal to our political moment: “Rejecting Fear, Envy, and the Politics of Division.” Instead, the speaker, Rep. Paul Ryan, used the occasion to reframe a point he’d been making over and over for months.
“Instead of working together where we agree,” said Ryan Wednesday, “the president has opted for divisive rhetoric and the broken politics of the past. He is going from town to town, impugning the motives of Republicans, setting up straw men and scapegoats, and engaging in intellectually lazy arguments, as he tries to build support for punitive tax hikes on job creators.”
A few blocks away, there was a group trying to do exactly what Ryan was calling for. The joint congressional “supercommittee” was meeting to discuss the options for long-term budget cuts. Democrats wanted to match the cuts with long-term tax hikes. Republicans were planning to kill any compromise that did that. Slightly farther away, Occupy Oakland protesters were gathering near City Hall after being tear-gassed the night before and subjected to mass arrests.
So Ryan had two goals on Wednesday. He had to portray Occupiers and Democrats as un-American extremists. He also had to mark time, as Republicans wait for the supercommittee drama to end without what Democrats call “going large”—big reforms that would demand some kinds of tax increases in exchange for entitlement cuts.
The first part should have been easy. All Ryan really needed to do was generate a headline. Something like: “Ryan, Obama Team Clash Over ‘Class Warfare.’ ” The actual class warfare clashes happening in major cities made most of the argument for him. Handy, that, because the data wasn’t doing the trick.
“We are an upwardly mobile society with a lot of movement between income groups,” Ryan said. “The Treasury Department’s latest study on income mobility in America found that during the 10-year period starting in 1996, roughly half of the taxpayers who started in the bottom 20 percent had moved up to a higher income group by 2005.”
That’s pretty much what the study says. It’s from 2007. As of four years ago, it provided a rosy picture of economic mobility. But why stop four years ago? What Ryan didn’t say was that more recently, Americans have been moving up and down between economic brackets at a punier rate than the French, or Germans, or Swedes, or some of the other peoples of Europe, the GOP’s continental cautionary tale.
One reporter tried to get at this, reminding Ryan of a brand-new CBO study of economic inequality. It had found that the “wealthiest 1 percent”—the gorgons that the Occupiers want to stop slanting the economy for—had tripled their wealth from 1979 to 2007. Ryan said he hadn’t heard the report. But would you like some bromides?
“If we try to go down the path where we put the government in the place where we try to equalize people’s lives,” he said, “where we try to equalize outcomes, we’ll all be equally miserable. Rather, let’s focus on equality of opportunity. Let’s focus on getting prosperity and economic mobility into those parts of America where they haven’t seen them yet.”
That’s what the Occupiers are saying, too. They’re just saying that the political system can’t or won’t fix it. The rest of Ryan’s speech was essentially an acknowledgement of this. The threat facing America was the long-term deficit. The way to cut the deficit was flatter taxes (“tax reform must broaden the base and lower rates”) and entitlement cuts. “Deficits are set to rise by a whopping $9.5 trillion over the next 10 years,” he said. Allowing the Bush tax cuts to expire for the wealthy would reduce the deficit’s increase by only about 8 percent.
Of course, that’s just what Democrats want the supercommittee to do. That’s what they have in common with the Occupiers. As Ryan finished, the committee’s meeting was about halfway done, with CBO Director Doug Elmendorf taking all varieties of leading questions. When I got there, Rep. Jim Clyburn, D-S.C., was prodding him about the inequality report, and about the GOP’s line that 47 percent of people don’t pay income taxes.
“They don’t owe anything because they haven’t made anything, right?” asked Clyburn.
Elmendorf managed to maintain complete and total mathematic disinterest. Sen. John Kerry tried to get him to endorse a “$3 trillion to $4 trillion” package of tax increases and spending cuts—conveniently enough, that was what Democrats were offering behind the scenes. What if the top tax rate rose from 35 percent to 39.6 percent? Sure, Ryan had just said it would save on only 8 percent of the projected deficit. Wouldn’t that be worth it?
“In our estimate,” said Elmendorf, “the negative effect of a larger debt would be larger than the positive effects of the tax rates.”
This was about as much as Democrats could hope for: Paul Ryan and Doug Elemendorf admitted that taxing the wealthy a little more would reduce the deficit. Of course, Democrats have been stacking up quotes and admissions like this for years, and proving totally unable to force a discussion about higher taxes or inequality. The only positive sounds they were hearing from committee Republicans—especially freshman Sens. Rob Portman and Pat Toomey—were about some closing of loopholes and lowering of rates. This was stuff that House Republicans had never been open to.
But there was an Occupier in the crowd. After Rep. Dave Camp finished speaking, she got up and walked right behind Elmendorf to give a short, awkward lecture.
“It’s very clear, the American people want you to tax the rich and end the war. That’s how we fix the deficit. All this obfuscation with percentages of GDP—that’s just trying to confuse the issue.”
She kept talking, repeating those basic points, for about 30 seconds. It took that long for Capitol police to pull her out of the room. She went easily, but not quietly.
“I represent the 99 percent,” she said. The door swung shut.