City Journal Spring 2014

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Luigi Zingales
The Ryan Reset « Back to Story

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Isn't the bigger question why is Romney presidential material if it took a VP to finally provide "the clear rationale he lacked previously?" Is this article saying that you should vote for a weak presidential candidate if you view his VP as strong? Why could Romney not "articulate a vision of America worth fighting for" on this own?
Ryan looks like a kid in a candy shop. Is this the guy we want as a heartbeat from the presidency.
Both Ryan and Romney have some explaining to do as to how they are going to free our free market. How can Mitt Romney be the protector of free markets and small business when he will be indebted to the cronies who are destroying free markets?

On July 19, 2012 the Financial Times reported Paul Ryan saying,

"Both political parties have fallen victim to “partnership” with large and well-connected companies, especially in energy, housing, finance and healthcare. Republicans have been guilty of confusing our pro-market principles with pro-entrenched business policies.... A growing coalition of reformers ... reject this pernicious crony capitalism. Our solutions promote an opportunity society, one that is rooted in the US commitment to free enterprise."

Based on the source of their campaign funds, how is the Republican ticket going to say no to those filling their coffers? ... http://www.freeourfreemarkets.org/2012/08/romney-guarding-free-markets.html#more
Excellent article. I hope Ryan's speech awakened the ignorant in our country to the reality which awaits us.
Mark, understand your disagreement with my comments but we’ve reached the same conclusion while traveling separate paths. In a way, we did choose national decline as you maintain but the powerful emotions driving this so-called choice has left us Americans with no viable alternative. Reference Debbie’s comments below and notice her specific emotions, her fear of Ayn Rand’s philosophy, her concern that women, but not men, will somehow become victims subsequent to a Romney/Ryan victory. Our matriarchal society, like Europe’s, attempts to blunt the hard edges of capitalism, denies the “dog eat dog world” concept, demands we maintain a precarious balance between personal liberty and an enforced charity to the less fortunate.

We punish the rich with increased taxes for being too successful at the economic game but we volubly deny we want to discourage that innovation whose wealth generating capacity makes our Welfare State possible. There’s a pragmatic balance we can maintain indefinitely between the good of the many versus the good of the one – or so we believe. It’s a matter of a deeply ingrained set of widely held beliefs and not a simple electoral choice.

As a nation, we’re set on a charted course which we can’t avoid, both for emotional and pragmatic reasons. It’s impossible to reverse our Welfare State at this point because it’s impossible to dismantle or stunt the growth of such a patiently crafted reality. We’re like the Old South and their slave based economy: We have no desire to deviate from our collective beliefs and no understanding of how we can change our present economy. The moral defenders of the Old South didn’t see themselves in societal decline and they successfully maintained their peculiar obsession for many decades under the belief they were both justified and had no viable alternative.
The woods are burning. National debt plus unfunded liabilities for Medicare, Social Security and federal and state retirement benefits now top $61 trillion. And Richard and the Democrats are worried about abortions? Grow up.
You failed to mention that Ryan also brings a belief that there can not be any abortions - even in the case of rape, incest, or a threat to the woman's life. Sorry, that makes him quite unacceptable, whatever his fiscal credentials may be.
The negative real interest rates on the country's debts are a function of a tidal wave of money the Federal Reserve has created to service that debt. Those of us that eat food and drive cars see the results of that as inflation. We also have inflation in investment instruments with a DOW at record levels over a moribound economy.
James - Longdrycreek Ranch August 30, 2012 at 8:34 AM
America is in a fight for survival. We are not talking about accepting decline in Texas but moving forward. I understand the Northeast and the Rust Belt is comfortable with decline, so long as they have a good job and reasonable employment.
But in the MidWest and in the South, we understand what work is and how to achieve goals.
If the goal is decline and you accept it, throw in the towel and let the rest of us secede from your Union because the latter is not our Union if you abandon America.

Have any of you read Nathan Hale's "Man without a Country?" If not, get a copy and see if you are the traitor or the captain of the ship.
Amazing how there have not been any deaths yet since Romney / Ryan are seizing the 'third rail of American politics' isn't it?

While I quite despise slogans, the idea of an American 'turnaround' is compelling. The entire country cannot run like Chicago does, simply because Chicago politics is like an un-vaccinated child in the school who doesn't catch disease because it is surrounded by those that contain the effects of bad choices.

We have had close to four years of non-vaccination choices on debt, government cronyism, seizure of assets for distribution to politically connected groups and a Justice department that is a laughing stock.

How much longer can we hold the umbrella over the wunderkinde from Chicago while he proves he did not do well in college?
It will be interesting to see how the Liberal Biased Mass Media has spun and twisted HIS actual words before morning !!!
Demographics are against the US and Europe, but they are also not in China's favour or many industrialised Asian nations. Emphasise on ICT and robotics can and should counter Asian labour cost advantages and rising fuel costs will also cut this advantage (greater distances to travel to market).
As we age we can still work, we can do the part time and mentoring roles to help the young. I am 49 and in my third career, due to market changes, with a second wife and family, like it or not I will have to work to 65 years old at least. My father worked to 72 and his brother to 80, they liked their work and did small jobs the young with mortgages can't do. My father was an electrician and my uncle a carpenter.
For me this is the answer to the deficit in part, work longer part time, mechanise more and make something besides reports about reports.
Ryan was just amazing tonight! Let's roll!
I doubt a clearer, more compelling rationale/explanation for Gov. Romney's decision to choose Paul Ryan exists. Dr. Zingales' analysis is superb; I wish it could be read by every American.
Gotta tell you, I find Ryan to be a profligate liar. He voted endlessly to expand deficits when Bush was president--He seems only to have become a deficit hawk once Boehner told House Republicans to fight Obama on anything he proposed. Ryan is a charmless liar--I don't think that this election is going to go romney's way.
The problem about Paul Ryan's "ideas" are that he has no ideas at all. The man is 100% flimflam. He has a "budget" that really isn't a budget, because it doesn't add up at all. Ryan has to resort to what Newt Gingrich characterized as right-wing "social engineering" and to supply-side "voodoo economics" that aren't backed by any figures, in order to make a hollow claim to balancing the budget. Even conservative economists have called Ryan out for not providing details, much less proof, for his outrageous claims.
Ryan rocks!
I have not heard Ryan say that he is for ending subsidies and crony capitalism. I *have* heard Sarah Palin talk about this explicitly. Funny she wasn't invited to the convention. I would like to believe what you say re. Ryan and big government, Mr. Zingales, but your words ring hollow. His budget proposal was a step in the right direction, but even though it's been called "controversial," it doesn't go far enough in solving the government's fiscal problem. I admire that he was a man of action, and took a risk, but there are certain arithmetic realities that can't be ignored, no matter how "controversial" they are. Even with his bold action, he ignored them.

What you say about fiscal complacency is very true. I've heard many times that we don't have a problem, because interest rates on bonds are at historic lows. That's the calm before the storm. It's like the 1918 flu. The time when the person infected was the most vulnerable was when they started to feel better. The time for action is soon, but I'm thinking it's really the GOP that's positioning itself to "manage our decline." The Democrats are not managing our decline. They're speeding 100mph towards a cement wall! If we go with them, we're all going to end up in the "ER" of life! Going with the Republicans I think is going to be like a long-running migraine. We're left with two bad choices. Do we want to get our demise over with quickly, or string it out?

Re. Pat's comment:

"And, like the Europeans, Americans have grown comfortable with decline primarily because we didn’t choose to decline, we simply have no feasible alternative."

I disagree with two things. No, we have not grown comfortable with decline. I hear quite a bit that people are *scared* that we're in decline, that their children will not be better off than they were. We're conflicted over what's causing the decline, and so we're nowhere close to getting out of it.

Secondly, it's not that we have no feasible alternative. We *ARE* choosing it. It's the *alternatives* that are unthinkable to many. We like to comfort ourselves, saying, "there's no feasible alternative," but that's so we don't have to look at them. They're too painful and inconvenient for our sensibilities. The only rationale I can think of for that is a state of denial, and hoping it'll all "go away." It could, but not in a way we'd like...
It is the Democrats who truly hate the poor. Why else would they first buy their loyalty by making them dependent on government handouts, and then drive the government into bankruptcy?
"Ryan’s plan is notable for proposing hard choices for those on both sides of the political aisle."

What hard choices, exactly, has he proposed for his own side of the aisle?
As a nation in slow gradual decline, we’ll need more than Ryan’s “vision” to rescue us. But this election is about installing elected employees who can successfully manage decline, not reverse it. Few Americans are under the illusion our nation’s setbacks are merely temporary or that the right “vision” will reverse the economic misfortunes yet to come. And, like the Europeans, Americans have grown comfortable with decline primarily because we didn’t choose to decline, we simply have no feasible alternative.

China, not America, is the future Global Superpower and we need government leaders who understand we can no longer afford that military role and will prepare us for a graceful exit, world stage left. Demographics has burdened us with an aging, needy population lacking the youthful energy necessary to restore growth. Like Europe and Japan, our present leaders have no realistic plans to halt our inevitable decline, just hopes it can be delayed as long as possible.

Those unique factors which once made us great: Youth, education, personal liberty and a restless creative energy are long since spent. Collectively, we’re not sure what the future holds for America but this election season’s talk of “visions” from pundits on both the Right and the Left hints that whatever we once possessed is probably long since gone. Picking a competent caretaker government is now the best we can hope for and, given the reasons for our nation’s decline, it’s probably a forlorn hope at that.
The problem is that it appears likely that a majority of Americans don't believe in "fiscal stability, not fiscal profligacy", dont' believe in "the power of the free-enterprise system, not government bureaucrats", and don't believe in "American exceptionalism" and do prefer "a Southern European-style, crony-capitalism".

As others have said: America can survive four more years of Obama, but I don't think it can survive a public that would elect Obama to four more years.
PoliticalPaige.net August 29, 2012 at 5:09 PM
I'm sorry, you lost me at the statement that Mr. Obama is known as a technocrat who solves problems. Assuming you are serious, by whom?
MissouriConservative August 29, 2012 at 4:58 PM
Romney has made two critical people choices we know of, his wife Ann and Paul Ryan. I'll vote for the man that picked either of these!
Well said - although a stretch to say people perceive the only difference between Barakonomics and Romney is taxing the top 1%. No CEO of a Fortune 500 company would want Obama back - and it's not just because they are concerned about their personal tax bill - they need a President who has actually had to make payroll without the luxury of printing new dollars. On social issues it would be tough to find two more opposing agendas - same sex marriage, abortion - opposite ends of the spectrum
Paul Ryan supported TARP (bank bailouts) and Medicare Part D (large spending increase).

Luigi, do you really think he 'believes in the power of the free-enterprise system' and 'believes in fiscal stability' as your last paragraph claims?
I love the comment from Debbie! It's Debbie Wasserman Schlitz for sure. Deluded.
I disagree that Ryan is not cold hearted. I believe he is borderline evil. Loves Ayn Rand, loathes the poor and women. What the man has done in the past over and over again says who he is. Ryan is cold hearted.
I disagree that Ryan is not cold hearted. I believe he is borderline evil. Loves Ayn Rand, loathes the poor and women. What the man has done in the past over and over again says who he is. Ryan is cold hearted.