MEMORANDUM

TO: EDITORIAL BOARD MEMBERS

FROM: SPEAKER BOEHNER’S PRESS OFFICE
DATE: APRIL 28, 2011
RE: THE PATH TO PROSPERITY

On April 15, 2011, the Republican-led U.S. House of Representatives adopted a budget – authored by Chairman
Paul Ryan (R-WI) and entitled “The Path to Prosperity” – that will help boost our economy and create new
jobs, lift the crushing burden of debt that threatens our future, and preserve critical health and retirement
programs for America’s seniors.

Despite the onslaught of misleading attacks from the Democratic Party, the most recent USA Today/Gallup
survey says “Republicans hold a 12-percentage-point edge over Democrats as the party better able to handle
the budget, and a five-point edge on the economy in general.” [1] The reason is simple: Republicans have put
forth a credible budget that honestly addresses the economic and fiscal challenges our country faces. In
contrast, President Obama put forth a budget in February that was widely-panned as not serious, and gave a
speech several weeks ago that again failed to fully address our nation’s problems.

Here is a quick comparison between the GOP budget (H. Con. Res. 34) [2] and the plans outlined by President
Obama:

THE GOP BUDGET WILL BOOST OUR ECONOMY & HELP CREATE NEW AMERICAN JOBS: The GOP budget is
focused on helping end the uncertainty facing job creators so they can start hiring again by cutting spending,
eliminating $800 billion in tax increases imposed by President Obama’s health care law, and preventing the
$1.5 trillion tax hike proposed in his budget. It creates a simpler, less burdensome tax code and lowers rates
for families and small businesses by “weeding from the tax code numerous tax breaks and loopholes,”
according to the Associated Press. [3] It also repeals the president’s health care law (and all of its tax hikes,
mandates, and excessive regulations) and removes barriers to energy production that will help lower gas prices
and create new jobs.

 The president’s budget would destroy jobs and create more uncertainty by imposing dramatic tax hikes on
job creators. James Pethokoukis with Reuters says the president’s proposed tax hikes amount to “$2
trillion in new taxes over 12 years.” [4]

 Analysis by the House Budget Committee found the White House “included the new tax increases
associated with the health care bill” in its budget. [6] Economist Diana Furchtgott-Roth says the health care
law’s tax hikes and penalties discourage small businesses from hiring. She says, “Firms with fewer than 50
workers won't want to grow, and firms with around 60 to 70 workers will be trying to shrink to 50 workers
to cut costs. Low-skill workers will be the worst affected.” [7]

[1]
http://www.usatoday.com/news/washington/2011-04-25-Poll-Republicans-budget-deficit-trust.htm
[2]
http://budget.house.gov/UploadedFiles/hconres34.pdf
[3]
http://www.deseretnews.com/mobile/article/700124527/Republicans-unveil-62-trillion-in-cuts-in-Path-to-Prosperity-
budget-plan.html
[4]
http://blogs.reuters.com/james-pethokoukis/2011/04/17/obamas-2-trillion-stealth-tax-hike/
[6]
http://budget.house.gov/UploadedFiles/obamabudgetanalysisfy2012.pdf
[7]
http://washingtonexaminer.com/node/69151
 In testimony before the House Budget Committee, former Director of the nonpartisan Congressional
Budget Office (CBO) Douglas Holtz-Eakin said “cutting spending is a pro-growth policy move,” and that
“controlling federal spending growth” is essential to help create new jobs. [9]

 When it comes to helping the economy, a Democratic polling firm found that independents prefer
“reducing the deficit through spending cuts” to tax hikes by a margin of 50 – 39 percent. [10]

THE GOP BUDGET WILL CUT SPENDING & PUT US ON A PATH TO PAY DOWN OUR DEBT: The Path to
Prosperity cuts government spending by $6.2 trillion over the next decade. The nonpartisan Congressional
Budget Office (CBO) confirms that the GOP plan balances the budget and puts us on a path to pay down our
debt over time. [11] It also eliminates hundreds of duplicative government programs, maintains the Republican
ban on pork-barrel earmarks, and ends the taxpayer bailouts of financial institutions (including Fannie Mae and
Freddie Mac, the government mortgage giants at the heart of our economic crisis).

 Alan Simpson and Erskine Bowles – co-chairmen of President Obama’s deficit commission – said the GOP
budget “incorporates many of the proposals included in the Commission report,” and “is a serious, honest,
straightforward approach to addressing our nation's enormous fiscal challenges.”

 The president’s budget locks in the failed “stimulus” spending binge and adds more than $9 trillion to the
debt over the next 10 years. Stanford economist John B. Taylor says federal spending was 18.2% of GDP in
the year 2000 and 19.6% in 2007. “But in the three years since 2009 it's jumped to an average of 24.4%,”
and the president's budget “proposed to make that spending binge permanent.” [12]

 President Obama has also asked Congress to raise the debt limit without serious spending cuts or budget
reforms. A new survey by Resurgent Republic found that “voters overwhelmingly oppose increasing the
debt limit unless strong conditions” and “substantial spending cuts” are attached. [13]

 A recent CNN survey shows that – when “dealing with the tough choices involved both in cutting programs
to reduce the budget deficit and still maintaining needed federal programs” – independents prefer the
Republican approach by a margin of 49 – 34 percent. [15]

THE GOP BUDGET WILL PROTECT & PRESERVE CRITICAL HEALTH & RETIREMENT PROGRAMS: Under The Path
to Prosperity, there will be no changes and no disruptions to benefits for Americans over the age of 55, and
future beneficiaries will have access to the same kinds of options as Members of Congress. The GOP budget
ensures that lower-income Americans get more support and that the costs of junk lawsuits are not passed on
to consumers in the form of higher prices. It stops Washington from raiding Medicare to pay for other costly
programs and eliminates the Independent Payment Advisory Board (IPAB), a “rationing board” created by
ObamaCare. It also ends the one-size-fits-all approach of Medicaid and gives states more flexibility to meet the
needs of their residents. Bottom line: this plan saves programs like Medicare for current and future
generations of Americans.

 The president’s budget does nothing, guaranteeing benefit cuts for seniors. FactCheck.org reported that “if
nothing is done, when those trust funds are exhausted, benefits would have to be cut by 22 percent in

[9]
http://budget.house.gov/UploadedFiles/holtzeakintestimony3102011.pdf
[10]
http://abcnews.go.com/Politics/wireStory?id=13227539&page=2
[11]
http://cbo.gov/doc.cfm?index=12128
[12]
http://online.wsj.com/article/SB10001424052748704071704576276584062512382.html?mod=ITP_opinion_0
[13]
http://resurgentrepublic.com/research/polling-analysis/voters-want-spending-cuts-and-budget-reforms-tied-to-debt-
limit-increase
[15]
http://politicalticker.blogs.cnn.com/2011/03/28/cnn-poll-neither-democrats-or-gop-have-edge-in-budget-battle/
 2037, and more each year after that, according to the most recent report of the system’s trustees. By
2084, the system will generate only enough revenue to pay for 75 percent of promised benefit levels.” [16]

 Analysis by the nonpartisan CBO shows – if we do nothing – Medicare will be bankrupt within 10 years. [17]
A report by the trustees for Medicare says “[w]ithout corrective legislation… the assets of the [Medicare]
trust fund would be exhausted within the next 7 to 19 years.” [18]

 The president would also rely on the IPAB – an unelected “rationing board” – to force hundreds of billions
of dollars in cuts in addition to the hundreds of billions in Medicare cuts Democrats used to finance
ObamaCare. The Wall Street Journal says this will lead to “the political rationing of care for the elderly, as
now occurs in Britain,” and many doctors and hospitals may “drop out of Medicare” altogether. [19]

 Despite the best efforts of Democrats to demonize the GOP budget, a CBS News/New York Times survey
“reported that a plurality of Americans actually approve of GOP Rep. Paul Ryan's Medicare reforms.” [20]

 A new national survey by Gallup says “[p]luralities of middle-aged Americans as well as those 65 and older
prefer Ryan's plan to Obama's,” with seniors preferring The Path to Prosperity by a 48-42 margin. [21]

For more details on The Path to Prosperity, please visit http://budget.house.gov/fy2012budget/ today.

[16]
http://www.factcheck.org/2011/02/democrats-deny-social-securitys-red-ink/
[17]
http://www.cbo.gov/budget/factsheets/2011b/medicare.pdf
[18]
https://www.cms.gov/ReportsTrustFunds/downloads/tr2010.pdf
[19]
http://online.wsj.com/article/SB10001424052748704613504576269582048771132.html
[20]
http://online.wsj.com/article/SB10001424052748704132204576285041082834676.html
[21]
http://www.gallup.com/poll/147287/Americans-Divided-Ryan-Obama-Deficit-Plans.aspx?version=print