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Ron Paul Releases His Economic Plan

Rep. Ron Paul released his economic plan yesterday and it proposes to slash $1 trillion from the federal budget in his first term.

Not a bad start.

Titled the “Plan to Restore America,” Paul proposes to slash federal spending immediately and intends to return the nation to budget surpluses by 2015.

“I am absolutely convinced this is the only way to prosperity,” Paul said in a recent ABC News article. “If we want jobs we have to get the government out of our way.”

Several prominent conservative economists would agree emphatically.

On the budget side, the plan calls to cut funding from nearly every government agency, while eliminating at least five departments altogether including the departments of Energy, Education, Housing and Urban Development, Commerce and Interior (which would cut about $179 billion from the federal budget).

Ron Paul Releases His Economic Plan

These departments have been targeted by the Texas politician because he has deemed many of the jobs involved to be  “nonproductive.”

“They’re not productive jobs, because governments aren’t smart enough” to spend tax dollars “diligently,” Paul said yesterday on CNN’s “The Situation Room.”

However, Paul said his plan would not simply fire thousands of federal workers, although that is the oft-repeated claim, but that it would “instead transfer them to other departments until they retire,” according to ABC News.

When it comes to Social Security, Medicare and other entitlement programs, Paul wants a system that “honors our promise to our seniors and veterans, while allowing young workers to opt out,” writes the Wall Street Journal.

He also wants to run Medicaid, the state-federal health care program, and “other welfare programs” through block grants to states, the Journal reports.

Ron Paul Releases His Economic Plan

On the revenue side, Paul would lower the corporate tax rate and eliminate the capital gains and estate taxes, reports Business Insider. The corporate tax rate would fall under Paul’s plan, to 15 percent from the current 35 percent, and corporations would be allowed to repatriate capital without paying additional U.S. taxes, writes FOX News.

The congressman also pledged to limit his presidential salary to $39,336, which his campaign says is “approximately equal to the median personal income of the American worker,” according to FOX.

Currently, the president of the United States makes an estimated $400,000 a year. That means that Ron Paul has willingly pledged to accept $360,664 less than what he could earn should he become president. Wow.

Watch the CNN Interview:

Here are some of the cuts, as compiled neatly into bullet points by Business Insider, and how much they would save in Fiscal Year 2013 compared to the Congressional Budget Office baseline:

  • Cut over $600 billion from mandatory spending programs including cuts to unemployment insurance
  • Department of Defense: End the wars, freeze other spending. $196,695,000,000
  • Department of Transportation: Privatize the FAA, $39,936,000,000
  • Department of Health and Human Services: Cut funding for FDA and CDC, eliminate Low Income Home Energy Assistance Program. $16,972,000,000
  • Department of Homeland Security: Privatize the TSA. $13,788,000,000
  • Department of State: Eliminate foreign aid and dues for international organizations. $19,412,000,000
  • Environmental Protection Agency: 30 percent cut from 2006 levels. $4,281,000,000
  • Eliminate the Departments of Energy, Housing and Urban Development, Commerce, Interior and Education. $173,677,000,000
  • Cut Medicaid spending by $95,000,000,000 (34 percent cut)
  • Cut Food Stamps program by $50,000,000,000 (62 percent cut)
  • Cut Child Nutrition programs by $7,000,000,000 (33 percent cut)
  • The plan does not reduce Social Security, Medicare, or retirement program spending

Ron Paul Releases His Economic Plan

What is most notable about Ron Paul’s plan is that, unlike some of the other economic plans put forward by GOP candidates, Paul’s plan focuses almost entirely on reducing the size of government and the federal budget. There is not as much focus on “job creation.” But that would go hand in hand with Paul’s claim that government needs to “get out of the way.”

“I would say it’s an economic growth plan and an avoiding of disaster plan,” said Chris Edwards, the editor of the libertarian Cato Institute’s DownsizingGovernment.org in a recent ABC News article. “I don’t think the government is very good at creating jobs, so I don’t think that should be the focus of federal policy.”

Since releasing his plan, it has been met with some praise and some criticism.

“The ideas that Congressman Paul espouses are not unique to him,” said Richard Parker, a lecturer in public policy at Harvard University’s Kennedy School of Government in an ABC News report. “They are kind of standard fare for libertarians.”

“His agenda right now is to get that political philosophy [libertarianism]floated,” Parker said,  ”whereas Romney is cobbling together what needs to be cobbled together to create policies that will assure his election as president of the United States.”

Whereas Zeke Miller of Business Insider had this to say in an article titled Here‘s Ron Paul’s Crazy Plan That Will Destroy The US Economy:

. . . the plan does not include an analysis of the economic effects of Paul’s proposed budget — though cutting $1 trillion from the federal budget would be an instantaneous 7 percent cut to GDP, nearly equivalent to the slowdown seen during the “Great Recession.”

And Henry Blodget of Business Insider clarified the above claims:

When you suddenly cut $1 trillion of spending out of a $14 trillion economy, what do you think will happen to the economy?

That’s right!

The economy will shrink by 7 percent, to $13 trillion.

And the folks whose salaries are paid by that $1 trillion–let’s call it 1.5 million of the 4.4 million people employed by the federal government–will instantly be unemployed.

So, yes, we think it’s fair to say that this would “destroy” the economy, at least in the short term.

Now, Ron Paul absolutely deserves credit for saying what expenses he would cut, unlike his lame-ass GOP candidate colleagues, who talk a big game about runaway spending but are too wimpy to actually cut anything.

And, it’s possible that, down the road, the 1 million or so government workers that Ron Paul fired would get motivated and get great jobs and start businesses and stuff and that, eventually, this would begin to close the $1 trillion GDP gap Ron Paul created when he fired them.

But this would take time.

And given that there are already 14 million unemployed people in this country, it will probably take a lot of time.

So be honest, Ron Paul fans: Ron Paul’s economic plan would, at least initially, destroy the economy. If you still support it because you think we need to “take our medicine” and because this medicine will make us stronger in the long run, great. But don‘t pretend it’s going to be all sunshine and roses.

Whether the praise or criticism for Paul’s plan is accurate, one thing is certain: America’s fiscal predicament is dire and it might be naive to think that anything short of drastic action will remedy the situation.

But exactly how drastic?

Read the Full Plan Here

Comments (41)

  • arkiee
    Posted on November 8, 2011 at 2:02pm

    Ron Paul has my vote. All the rest are the same as we have now. I vote for freedom , peace and prosperity.

    Report Post »  
  • cyclops
    Posted on October 23, 2011 at 8:30pm

    Well, unless if he is got money set aside in the Cayman islands, how can he survive living in Washington D.C., living on $39,000 plus salary?

    Report Post » cyclops  
  • TheSerpentsSeed
    Posted on October 19, 2011 at 4:14pm

    Yeah, Ron Paul, the Christian, Doctor, Military veteran, and 12 time elected congressman, who has never voted to raise taxes once, doesn’t under stand foreign policy like Bush, Obama and all of the other Depublicans. That is hilarious. Ok, all you so-called Tea Party-constitutionalists…. Where in the constitution does it say to give other countrees OUR money, other than in Trade? You know, you “almost-conservatives” better wake up. Bush, Obama and every other candidate in this race are the same.

    And we all know, how our policy in the Middle East has been successful. You guys need to really wake up. The media/government complex is choosing your candidates for you. If the last 100 years have made you safer and more free…. keep up with the status quo.

    Ron Paul or United States Of China

    Report Post »  
    • TimeLifeEditor
      Posted on October 23, 2011 at 12:40am

      Registered Independent voters should ask ourselves why. And after understanding ALL those reasons why neither party works; WE should give RON PAUL the Republican Nomination 2012.!!!

      Report Post » TimeLifeEditor  
  • spudwhite
    Posted on October 19, 2011 at 2:45pm

    Ron Paul 2012!
    Beautiful economic plan.
    No, he’s not perfect, but he’s the closest thing to it we have in opposing obama and returning to our American roots.
    Think different, Think principles, Vote Paul.

    Report Post »  
    • JMorcan
      Posted on October 19, 2011 at 4:13pm

      This won’t help any of us compete with $0.50/hr workers in China and India. Why will it matter what the dollar is worth if we don’t have any?

      Report Post » JMorcan  
  • libertyisfundamental
    Posted on October 19, 2011 at 2:10pm

    Zeke Miller is an idiot. Government doesn’t produce anything. Every person employed by government necessarily pulls money from private firms who could expand and more efficiently use there dollars creating wealth for the nation. Paul’s plan definitely cuts government employment, but it also frees up an enourmous amount of capital for private investment and job growth. That coupled with the massive decrease in oppressive regulation accompanied by the elimination of these departments would creat the most robust growth this nation has ever seen.

    Economically, I support Paul 1000%. But I cannot support the apparent isolationist approach to world affairs. There are many people who are driven by power and want to kill us. Pulling ourselves into a shell and saying if we keep to ourselves they’ll all leave us alone is naive to say the least.

    Report Post »  
    • unbound1
      Posted on October 19, 2011 at 3:30pm

      He did say he wouldn‘t cut defense so it’s not like he isn’t going to protect us from threats. He just wants to get us out of these “wars.” He thinks we should protect our own boarders instead of other‘s especially when we can’t afford it.

      Report Post » unbound1  
    • unbound1
      Posted on October 19, 2011 at 3:38pm

      http://www.youtube.com/watch?v=a8S3yws_88I see this clip…he explains he cuts military, but not defense…maybe this will help you

      Report Post » unbound1  
    • TheSerpentsSeed
      Posted on October 19, 2011 at 4:29pm

      You know, we “had”to go into Afganistan, because of our meddling. We had to go into Iraq, because of our meddling. We are IN Isreals pocket and cause them more problems right now, because of our meddling. Egypts “president” fell, because of our meddling. We are going to go into Iran???…. You guessed it, because of our meddling. Our Middle East policy is working out great!

      How about we close all foreign bases, put them on our boarders, sea ports and airports, save some money, give our guys a rest and a raise. You know why, because all the trouble we are causing around the world, we are gonna need our military rested and HERE!

      Report Post »  
  • Trading_barracuda
    Posted on October 19, 2011 at 1:45pm

    Priceless: Herman Cain’s Economic Adviser Art Laffer

    http://www.youtube.com/watch?v=2I0QN-FYkpw

    Report Post »  
  • mike_trivisonno
    Posted on October 19, 2011 at 1:41pm

    Ron Paul is incredibly dangerous. His child like attitude toward Jihad is frightening to witness.

    Unless he is willing to learn about the civilizational enemy that has hounded this nation from its inception, then he should not be seriously considered for the Presidency.

    Report Post » mike_trivisonno  
    • Trading_barracuda
      Posted on October 19, 2011 at 1:51pm

      End Foreign Aid to Israel? Hell No!

      “My friends, you don’t need to do nation building in Israel. We’re already built. You don’t need to export democracy to Israel. We’ve already got it. You don’t need to send American troops to defend Israel. We defend ourselves.”

      ~ Israel Prime Minister Benjamin Netanyahu,
      May 2011 before the U.S. Congress

      Oh…

      I guess I was wrong and Ron Paul was right..

      Sorry

      Report Post »  
    • Delta D-5-3
      Posted on October 19, 2011 at 1:57pm

      WOW! Look at the cuts to the defense budget!! I’ve been warning about this kook for years. He IS dangerous when it comes to his views on the military and in particular Iran. Thank god he doesn’t have a snowballs chance in hell on ever getting elected to POTUS!!

      Report Post » Delta D-5-3  
    • mike_trivisonno
      Posted on October 19, 2011 at 2:05pm

      I am not sure what you are talking about.

      Ron Paul does not understand Jihad. I don’t even think he knows what it is.

      Israel, like any other non-muslim country, has suffered violent from violent jihad. I am not sure what foreign aid has to do with jihad.

      The fact is that Ron Paul labors under the deception that we have brought the Jihad upon ourselves through our misapplication of foreign policy. He is wrong, and were he to peruse historical texts freely available to all, he would find that Jihad is not a response to and perceived misconduct by non-muslims.

      Jihad is the process by which Islam is spread. It is not a response, it is a process. Jihad proceeds regardless of what non-muslims do.

      Report Post » mike_trivisonno  
  • Trading_barracuda
    Posted on October 19, 2011 at 1:05pm

    Becket Adams,

    When are you going to learn that good journalism doesn’t sell anymore.
    You must learn to sensationalize and demonize your subject other wise the sheep won’t come and feed.
    Becket, I’m warning you, if you don’t start lowering your high professional standards you will be washed up.

    Maybe you should put out a You Tube and cry like Baby Beck. That might get your traffic up.

    Thank you however for a well done srticle with all pertinent rferences.
    I thought I had strayed off the Blaze page for a minute.

    Report Post »  
    • Biscuit Feed Bubba
      Posted on October 19, 2011 at 1:16pm

      http://www.moneynews.com/StreetTalk/Laffer-Cain-tax-plan/2011/10/19/id/414998?s=al&promo_code=D49D-1

      Economist and former Reagan adviser Arthur Laffer says Herman Cain’s 9-9-9 tax plan is a good one.

      “(The) plan was designed to be what economists call ‘static revenue neutral,’ which means that if people didn’t change what they do under his plan, total tax revenues would be the same as they are under our current tax code,” Laffer writes in The Wall Street Journal, adding that he believes that with the boost Cain’s plan would give to economic growth it would bring in even more revenue than expected.

      “Once the dynamics take hold, many of those below the poverty line will find good jobs and thus will rise above the poverty line and start paying taxes,” says Laffer.

      Report Post »  
  • Trading_barracuda
    Posted on October 19, 2011 at 12:56pm

    Paul has my vote. Guess that makes me a Paulbot. I was for Cain but I’ve came to my senses, and realized that Paul is the only one that is consistent and has REAL plans to get our country back.
    In his first couple years in office America will be back on track.

    I was just kidding about Cain…

    Report Post »  
    • techengineer11
      Posted on October 19, 2011 at 1:06pm

      So the Blaze is finally getting around to publishing the plan?

      Heard someone call into Beck’s radio show at lunch expressing support for Dr. Paul but the guy feeling in for Beck would only offer ridicule and contempt for Dr. Paul’s view on foreign policy. Personally I want a debate on his foreign policy views.. A fair reasonable logical debate. The caller wouldn’t go there but people who support Dr. Paul need to be prepared to discuss the topic. It’s a no brainer and an easy winner.. Anyone that has even the slightest bit of reasonableness about them will see the merits of Paul’s views and the error of the Neo-Cons view if the facts are put forth..

      What about Beck, Hannity, Levine, Blaze?? Let’s have a debate.. I want to know how much money should we continue to borrow in order to prosecute these Wars in the Middle East and supply Israel with its yearly welfare check.. Let’s hear it.

      Report Post » techengineer11  
    • Delta D-5-3
      Posted on October 19, 2011 at 2:08pm

      QUOTE: “In his first couple years in office America will be back on track.”

      Ummm, ok. You mean IF we still have a country after he cuts our military to 1850 levels. Paul lost me when he decided to be Jimmy Carter x 10. IF you love your country as much as Pauls supporters say they do, then WHY do his supporters ALWAYS conveniently IGNORE his dangerous views(some say ignorance) on just how dangerous this world is, and the threats to our great country??

      Report Post » Delta D-5-3  
    • techengineer11
      Posted on October 19, 2011 at 2:42pm

      Delta D-5-3: About the only legitimate threat to America is an internal threat. Where do you see the treat coming from and since we already spend more on our Military than the combined Globe put together exactly how much is enough for you? lol

      Come on guys surely you can engage in a little critical thinking can’t you? Does everything have to be black or white for you?

      Report Post » techengineer11  
  • 3monkeysmomma
    Posted on October 19, 2011 at 11:58am

    This analysis is no shock to me.

    We are speeding towards a cliff. We need someone with the courage to “slam on the breaks”.

    Report Post » 3monkeysmomma  
  • NEUTRON
    Posted on October 19, 2011 at 11:24am

    Paul has my vote. Guess that makes me a Paulbot. I was for Cain but I’ve came to my senses, and relized that Paul is the only one that is consistent and has REAL plans to get our country back. Yeah his first couple years in office will be tough but in the long run America will be back on track.

    Report Post »  
    • Biscuit Feed Bubba
      Posted on October 19, 2011 at 1:21pm

      ************** http://www.moneynews.com/StreetTalk/Laffer-Cain-tax-plan/2011/10/19/id/414998?s=al&promo_code=D49D-1

      Economist and former Reagan adviser Arthur Laffer says Herman Cain’s 9-9-9 tax plan is a good one.

      “(The) plan was designed to be what economists call ‘static revenue neutral,’ which means that if people didn’t change what they do under his plan, total tax revenues would be the same as they are under our current tax code,” Laffer writes in The Wall Street Journal, adding that he believes that with the boost Cain’s plan would give to economic growth it would bring in even more revenue than expected.

      “Once the dynamics take hold, many of those below the poverty line will find good jobs and thus will rise above the poverty line and start paying taxes,” says Laffer.

      Report Post »  
  • straightstreet1
    Posted on October 19, 2011 at 11:18am

    Ron Paul has my vote. Even if all he did was remove the Department of Energy our country would take off!

    Report Post »  
    • MGB-CPA
      Posted on October 19, 2011 at 2:39pm

      I read some of these idiotic comments and I realize how that crook, Obama got into office. Sorry, Ron Paul sounds like a nut, act like a nut, talks like a nut … maybe he’s a nut. The only person capable of leading us to fix our country is Newt Gingrich.

      Report Post » MGB-CPA  
  • Timothy_Reid
    Posted on October 19, 2011 at 11:02am

    The comparison to the Great Depression decline is amusing. At that time the decline was in private businesses for the purpose of increasing government. This would be a decline in government to increase private business, and there’s a problem with that somewhere? It doesn’t matter what the initial results are the country is hurting NOW, feeble attempts to produce solutions for symptoms and not addressing the ACTUAL PROBLEM (too much gov) with actions is all anyone else is suggesting. Even then they’re scared to come out with it in a plan of any sort…..

    Report Post »  
  • Acting Man
    Posted on October 19, 2011 at 10:55am

    Wow, amazing analysis by the business insider guys.

    Report Post »  
  • BlackAce41
    Posted on October 19, 2011 at 10:32am

    This make sense but would have be able to pass it through a Congress run by Progressive’s?

    Report Post » BlackAce41  
  • DeercreekPatriot
    Posted on October 19, 2011 at 9:22am

    Ron Paul 2012!!! Restore America Now

    Report Post »  
  • Cat
    Posted on October 19, 2011 at 7:49am

    If anyone bothered to listen to the rest of Rush’s show that day they would have heard him say he is NOT endorsing any candidate, at this time, “It’s WAY too early.”
    Later in that show, he questioned the caucuses and primaries being pushed up to ensure that Mitt Romney is the man.
    Listen to EVERYTHING

    Report Post » Cat  
  • Workforit
    Posted on October 19, 2011 at 6:24am

    The departments that Paul wants to chop don’t “produce” a damn thing. They make it tougher for the ones that “do produce”. As for all the future unemployed workers…

    Welcome to the real world. You will have to re-invent yourself just like a good chunk of the recently unemployed American public is doing right now. Myself included.

    Look at the bright side, all you government paper pushers will have time to read books like “Who Moved My Cheese” and “One Hundred Winning Resume Samples”… Hey it can be done, others are doing it daily! It will even be easier for you without all your needless regulations…Maybe a 14 year old kid might be able to mow the neighbors lawn now… Sorry, my bad… That is OSHA. Another useless government entity worth whacking…FEMA is another good one to close up, look I just saved another Trillion!

    Ron Paul 2012!

    Report Post »  
  • KTsayz
    Posted on October 19, 2011 at 4:50am

    Paul’s plan is fantastic. But why include that garbage spewed by Business Insider? They are obviously left of center as the NY Times and NPR use them for info. And Kevin P Ryan, founder, is a Yale/CFR man.
    Becket, I liked your post up until you used BI as your ‘balance’ for the piece. Doesn’t Beck tell you guys to vet your sources before using them?

    Report Post »  
  • dejavu22
    Posted on October 19, 2011 at 1:49am

    He has my vote.

    This plan is the only sane one that has been put forward.

    Report Post » dejavu22  
    • Delta D-5-3
      Posted on October 19, 2011 at 2:21pm

      Sure. It’s sane to de-fund our military when we have countrys who just want to wipe us off the map. Yea, that’s sane. And it‘s also the reason why Moonbat Paul hasn’t a chance in hell on being OUR “commander in chief”. But hey, you guys could always dream of a dis-armed America anyways………..

      Report Post » Delta D-5-3  
    • dejavu22
      Posted on October 19, 2011 at 3:12pm

      Military spending is the right’s equivalent to education spending. It doesn’t matter what the amount is it will never be sufficient for some and all our problems would be solved it a little more were given… at least until they get it then only a little more again.

      Report Post » dejavu22  
  • ProbIemSoIver
    Posted on October 19, 2011 at 12:51am

    I guess Rush Limbaugh is a “Paulbot” now.

    http://www.youtube.com/watch?v=DcTYUwCbslE

    Report Post » ProbIemSoIver  
    • Fella
      Posted on October 24, 2011 at 5:09pm

      Hahaha, Rush claims Paul stole his economic policy. I fear Rush may be popping pills again.

      Report Post »  

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