Paul Ryan Unveils the GOP's Plan to Balance the Budget

House Budget Committee Chairman Paul Ryan (R., Wis.) Tuesday proposed eliminating the government's budget deficit in 10 years through major changes to Medicare, Medicaid, food stamps and other programs—and took the controversial step of counting in assumptions on how the plan would spur economic growth. 

The fiscal year 2015 budget blueprint is a largely political document that establishes House Republicans' commitment to eliminating the deficit as a top priority. Mr. Ryan says it would cut $5.1 trillion in projected spending over a decade, with 40% of that coming from simply repealing the Affordable Care Act.

To replicate a point of pride in his budget blueprint last year—namely balancing the federal budget in 10 years—Mr. Ryan this year has opted to incorporate an estimated economic boost that he says would result from reducing the deficit, in turn lowering interest rates and spurring growth. He didn't include similar projections in past budget blueprints. 

"The greater economic output that stems from a large deficit-reduction package would have a sizable impact on the federal budget," Mr. Ryan writes in his plan. For example, Mr. Ryan estimates that in 2024, the government under his plan would spend $4.995 trillion and bring in $4.926 trillion in revenue. That would result in a deficit of $69 billion.

CLICK HERE to read the CBO's Review of Ryan's Plan

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Likely bolstering Mr. Ryan's position, the nonpartisan Congressional Budget Office Tuesday released a 16-page review of the plan and said that deficit-reduction of the magnitude described by the Wisconsin Republican would, in fact, boost the economy. The CBO stopped short, however, of weighing in on the specifics of Mr. Ryan's budget cuts. 

Mr. Ryan's budget also broadly calls for reining in the federal government and expanding the role of states and private companies in an effort to boost growth and lower costs for an array of programs, including food stamps and Medicaid. It would include deep cuts to domestic programs, far beyond the sequester-level reductions that some members of both parties have recently worked to reverse.

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