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15 August 2012

Paul Ryan on Europe

Compared to Ryan's budgets, Cameron's coalition looks positively profligate.

By Alex Hern

As a congressman, Paul Ryan hasn’t turned his gaze overseas all that often. He is far too busy focusing on important domestic issues like changing the taxation on arrow shafts from a 12.5 per cent of sales to a 39¢ flat tax to spend time worrying about the Old World.

But he has made two notable, on-the-record, contributions to debates happening on this side of the pond.

The first was in 2009, when he co-authored a Wall Street Journal article about the perils of socialised medicine.

The piece, titled Beware of the Big-Government Tipping Point, was published in January 2009, the day before Barack Obama was sworn in as president, and is a strongly worded attack on the then-nascent idea of Obamacare.

In the piece, Ryan touches on the NHS, arguing that:

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We need only look to Great Britain and elsewhere to see the effects of socialized health care on the broader economy. Once a large number of citizens get their health care from the state, it dramatically alters their attachment to government.

This line has been ramped up in the re-reporting of it, becoming a “savaging” in the Times, where Sam Coates suggested that Ryan had claimed “that free healthcare distorts the democratic process”. The truth is that the pieces more mild, more wonkish, and even partially correct – although deeply cynical.

He is right,because it is obvious to anyone that the American attitude to government is clearly different to the British one. For all that some on the right of the Conservative party love to repeat Ronald Reagan’s famous quote about Government being the problem, that view is only really held by the fringes of European society – as opposed to the US, where it is the mainstream opinion.

It’s only partly right, though, because he’s clearly overstating the effect healthcare has. Attachment to the state comes from more than just getting your medicine from The Man. It is experiencing a caring state full stop which changes how a nation sees the role of government.

And it’s deeply cynical because he seems to be arguing that a government should stay deliberately bad – should stop doing good things, and only do things which will anger its citizens – because otherwise people will realise that big government isn’t such a bad thing.

It’s putting the cart before the horse. If Ryan thinks universal healthcare is bad, he should have the courage to let the voters decide whether they agree with him – not prevent them from getting healthcare because they might realise he’s wrong.

Ryan’s other moment touching on British issues came in 2011. He was given the opportunity to make the Republican response to Obama’s State of the Union address (roughly analogous to the Queen’s speech, in that it lays out the legislative agenda for the year ahead). He argued:

If we continue down our current path, we know what our future will be. Just take a look at what’s happening to Greece, Ireland, the United Kingdom and other nations in Europe. They didn’t act soon enough; and now their governments have been forced to impose painful austerity measures: large benefit cuts to seniors and huge tax increases on everybody.

Lumping together “Greece, Ireland and the United Kingdom” betrays a basic lack of comprehension of the extreme differences between the crises in those three countries.

For one thing, there is no way that America could ever (in the foreseeable future) face crises similar to those of Ireland and Greece. Simplifying matters enormously, Greece’s problems were borne from corrupt governments systematically lying on national accounts to enter the Euro, running spiralling deficits once the cheap credit became available, and having no recourse to the currency markets when the truth came out.

Ireland, meanwhile, suffered a hangover from a privately financed housing boom which turned into a privately financed housing bust, a banking crisis which required a government bailout, and, again, the straightjacket imposed by the Euro combined with German intransigence aggravating the whole matter.

And if Ryan was seriously suggesting that following Obama’s vision for America could take the country in the direction of the UK, he needed to take a look in a mirror.

Even in 2011, it was clear that the UK did not have any particular debt crisis, and that overzealous attempts to deal with the deficit were harming demand and compounding the error. Construction spending had fallen, confidence had been slammed and the VAT rise had just been introduced.

Of course, for all that Ryan looked economically illiterate comparing the three at the time –and he did – in hindsight, he looks even worse. The Conservatives, we now know, inherited recovery and turned it into recession, and they did that through targeted application of austerity. But compared to Paul Ryan’s budgets, the Coalition looks positively profligate.

The VP pick has not got a perfect track record talking about things outside his expertise, then. I’d suggest he stick to areas he knows about, but it’s becoming rapidly questionable whether there actually are any. Maybe he should just keep quiet and be a pretty face on the campaign trail.

 

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