The man who predicted the 2008 meltdown addresses Paul Ryan’s budget

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Below are a few important excerpts from Peter Schiff’s latest Townhall.com article—but first you should know this about Schiff (from Wikipedia):

In an August 2006 interview Schiff said: “The United States economy is like the Titanic and I am here with the lifeboat trying to get people to leave the ship… I see a real financial crisis coming for the United States.”

On December 31, 2006 in a telecast debate on Fox News, Schiff forecast that “what’s going to happen in 2007 is that real estate prices,” which had peaked in late 2005, “are going to come crashing back down to Earth.”

In his 2007 book Crash Proof, Schiff wrote that United States economic policies were fundamentally unsound.

Some of us who have been warning for many years about the pathetic state of the Republican Party and the incompetence and mal-motivation of those who presume to be its leaders appreciate Schiff’s having been ignored regarding the economy.

In his column this weekend, Schiff addresses the reality of the Paul Ryan budget:

It says a great deal about where we are that the symbolic budget plan proposed last year by Congressman Paul Ryan, the newly minted vice presidential nominee, has created such outrage among democrats and caution among republicans. […] The plan is apparently so radical that even the Romney campaign, while embracing the messenger, is distancing itself from the message (it appears that Romney wants to bathe himself in the aura of fresh thinking without actually offering any fresh thoughts).

[…]

So what was the Ryan Budget’s radical departure from the status quo that has caused such uproar? If enacted today, the Ryan budget would so drastically upend the fiscal picture that the U.S. federal budget would come into balance in just… wait for it…. 27 years! This is because the Ryan budget doesn’t actually cut anything. At no point in Ryan’s decades long budget timeline does he ever suggest that the government spend less than it had the year before.

Schiff addresses Ryan’s wildly optimistic projections for growth and revenue, and then writes:

Like all other government forecasters, Ryan never considers how rising interest costs on the many trillions of dollars of outstanding government debt holdthe potential to completely upend budget projections. For more on this, see my recent commentary “The Real Fiscal Cliff.”

[…]

While I appreciate that Ryan has the courage to take a position at the vanguard of his party in the campaign for fiscal responsibility, the modesty of his plan is just the latest reminder of how utterly divorced from reality Washington politicians remain. Like all of his brethren, Ryan is pinning his budget battling plans on the pain free “grow your way out of it plan.” But as long the government consumes so much of the nation’s productivity, the conditions to create that growth will never occur. Hope is not a strategy.

Read the entire article

 

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