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Bloomberg View: Ryan remembers his anti-poverty roots

Bloomberg View

First Published Jul 26 2014 01:01 am • Last Updated Jul 26 2014 01:01 am

It’s rare for a prominent politician to publicly rethink his position on one of his signature issues. Paul Ryan has just done so — and deserves credit for it.

The Republican chairman of the House Budget Committee Thursday released a thoughtful blueprint for overhauling $800 billion worth of U.S. anti-poverty programs. He doesn’t get every detail right, but Ryan has put forth a politically brave and economically sound proposal.

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In contrast to the exercises in Dickensian austerity that are his annual spending plans, it’s revenue-neutral, meaning it would neither increase nor decrease the deficit. That it’s Ryan’s should challenge Republicans to reconsider their zeal for cutting spending on the poor while doing little to raise taxes or cut benefits for the wealthy.

It may even provide the wedge with which the reformicons — a so-called group of conservative reformers that includes Sens. Marco Rubio of Florida and Mike Lee of Utah — can bring some reason and common sense to party discussions about spending.

It is certainly a foundation on which conservatives can build. One of the plan’s proposals would combine 11 current programs — including food stamps, child care, housing subsidies and what remains of traditional welfare — into something called Opportunity Grants. It sounds like a block-grant program, the anathema of liberals because they distrust the states’ ability (or will) to distribute grants fairly, and it comes with a big exception: States can opt in only if their plans pass federal-government muster.

If conditions warrant it, why shouldn’t states direct less money to housing and more toward, say, transporting low-income workers to jobs? Such flexibility isn’t possible now. For recipients, one-stop shopping could replace standing in line at various locations for various benefits, almost a full-time job in itself.

Another proposal would require beneficiaries to write a "life plan." Yes, it sounds like some kind of group-therapy exercise, but it also makes sense. These plans would include deadlines for completing high school, job training or counseling. They would have incentives for finishing as well as consequences for failure.

The working poor would also get new help through an enhanced earned income tax credit. Here, Ryan agrees with President Barack Obama that childless adults should be eligible for the credit. He wisely recommends including the credit in recipients’ paychecks, rather than when they file a tax return, if they do.

So what’s not to like? The track record of Republican governors who have refused to expand their Medicaid programs under the Affordable Care Act, at no cost to their states, is worrisome. Would the same governors take advantage of Ryan’s Opportunity Grants to slash benefits and shrink the size of government?

Ryan doesn’t address this, and his plan explicitly protects only the low-income elderly and disabled from benefit cuts. A "do no harm" requirement, in which participating states must show they can achieve equal or better outcomes than existing federal programs, could help address this concern. An annual inflation adjustment to the Opportunity Grants program would also help to make sure it keeps serving its purpose.

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