After an electoral shellacking and exit polls that show the vast majority of Americans are on Barack Obama's side when it comes to the major issues of the day, Paul Ryan is headed back to Congress convinced that he espouses "very popular ideas" and calling the 2012 results "a very close election."
With this mind-set Ryan is prepping to turn the "fiscal cliff" austerity debate to the advantage of the Social Security bashers and Medicare slashers.
A reality check is in order.
Ryan Loses His State, County, City, and Precinct -- Twice
While Ryan won his Congressional seat in a deeply Republican corner of Wisconsin, he failed in his main job -- to deliver Wisconsin for Romney. He not only lost the state of Wisconsin, he lost his home county, lost his home city, and even lost his precinct in both the presidential and Congressional races (no word yet on how his next door neighbors voted.) Ryan, who has never had a race of any significance, finally had his ideas and his record exposed and voters did not like what they learned. His support in the Congressional race took a 14 point slide over his 2010 -- one of the worst performances in the nation.
As for a close election -- not so much. The Romney/Ryan ticket is running about 3.4 million votes behind Obama, in the 47 percent zone. Turns out Romney is the president of the 47 percent, not Obama. To put the numbers in perspective, Barack Obama has won more popular votes than any Democratic candidate for president in history -- except Barack Obama in 2008. With far fewer votes in 2004, George W. Bush declared a "mandate" and crassly boasted of his "political capital."
Ryan Lost the War of Ideas
Ryan not only took a shellacking, his ideas did too. Raising taxes on the rich and taking a "balanced" approach to deficit reduction was a key message of the Obama stump speech. Senator Dick Durbin (D-Il.) has it right when he says the election was a "straight up" referendum on raising taxes on the rich, and Ryan lost that vote. 60 percent of voters said in exit polls that taxes should increase, either for everyone or those making over $250,000. More people liked that idea than voted for Obama. Even William Kristol, editor of the conservative Weekly Standard, has positive things to say about the idea. But Ryan is pretty sure it is not time to raise taxes on the richest Americans -- that would "hurt the economy."
Ryan also told a Wisconsin reporter that the GOP had a winning message on Medicare. "I don't think we lost it on those budget issues, especially on Medicare -- we clearly didn't lose it on those issues." More alt-reality from the House Budget Committee chair. Medicare was the topic of more campaign commercial than any other. While voters may be divided about Obamacare, they were pretty clear on Medicare. In exit polling released by the AFL-CIO, "reduce spending on Medicare and Social Security to bring down the budget deficit" drew support from just 18 percent of voters nationwide.
Ryan will be relying on his reputation as a deficit hawk as he joins John Boehner and Eric Canter on the fiscal cliff negotiating team. But this reputation has been shredded by a steady stream of contradictory positions. Economist Paul Krugman notes: "Mr. Ryan's alleged plans to reduce the deficit were obvious flimflam, since he was proposing huge tax cuts for the wealthy and corporations while refusing to specify how these cuts would be offset. But in the eyes of the deficit scolds, his plan to dismantle Medicare and his savage cuts to Medicaid apparently qualified him as a fiscal icon."
Hyping the Cliff Myth
Already the GOP and the media are hyping what Ben Bernanke has dubbed a "fiscal cliff" -- a January 1, 2013 self-imposed deadline for working out a deal on how to tackle the deficit. If Congress fails to act, $1.2 trillion in spending cuts and tax hikes will start to phase in (prompting many to call it a "slope" not a cliff). The Bush tax cuts will expire for all Americans, not just for the top wage earners, which includes a hefty hike for the middle class. While the Defense Department will be subject to cuts, Social Security and Medicare are exempt from this deal.
In many ways this is a less frightening scenario than the threat that looms in the background -- Simpson-Bowles. The austerity package prepared by the White House deficit commission and embraced by President Obama is now looking pretty good to the GOP. It has the aura of bi-partisanship, but it actually bites hard on the life-saving programs Medicare, Medicaid and Social Security. Among other things, the plan calls for cutting Social Security by 3 percent and phasing in an increase in the normal retirement age to 69.
Which is why progressive University of Texas economist Jamie Galbraith is saying of the cliff: "Don't panic. This is not a moment for high drama. This is a moment for no drama." Krugman says, "let's not make a deal" and an increasing number of people are becoming "cliff divers." Going over the cliff is not perfect, "but it may be necessary," explains former White House budget director Peter Orszag, who thinks cliff diving will produce better policy options in the end.
If the United States is facing a crisis, it is a jobs crisis and a revenue crisis. Continued unemployment and two rounds of Bush tax cuts are depressing the economy and costing the nation hundreds of billions in lost revenues each year adding to the deficit. Investments to rapidly decrease unemployment would be one of the best fixes possible.
"Magic Moment" or "Austerity Bomb?"
Ideologues like Ryan and wealthy Wall Street financiers like Erskine Bowles are salivating at the "magic moment" posed by the faux crisis (Bowles actually said that). But Bowles-Ryan magic means painful austerity for the rest of us.
So far, Obama is saying the right things. On Tuesday, the president talked to labor leaders and other liberal groups about keeping their staff and campaign structure running, indicating an interest to take the austerity fight outside the beltway. Labor, which was essential to winning Ohio, Wisconsin and other battleground states, assured the White House "we have your back." On Wednesday, the president claimed a mandate in the most positive terms: "I have got one mandate. A mandate to help middle class families and families working hard to get into the middle class. That's my mandate... The American people just work really hard to see if help us get ahead because we are working hard out here and we are still struggling."
Obama said repeatedly yesterday that he is open to "new ideas" for raising revenue. (What about a Robin Hood Tax on Wall Street, Mr. President? There is a new idea that would generate billions each year for jobs and health care.)
But while Obama said he would stand firm on making sure the Bush tax cuts expire for the wealthiest (making a huge dent in the deficit), he did not make the same pledge to defend Medicare and Social Security. Previously, Obama had endorsed an unacceptable 5-to-2 ratio of cuts to revenues in a deficit deal. Senator Bernie Sanders (I-Vt) is worried. He is one of 29 Senators who signed a letter to the president in September asking him to "oppose including Social Security cuts for future or current beneficiaries in any deficit reduction package."
Stay tuned and in the meantime strap on the parachute.