Who Really Wins with Ryan's Budget?

This is part two in a series. Click here for part 1.

Palin speaks to a radical mood in the country: a mood of victimization and resentment.

Paul Ryan also speaks to a radical mood in the country: a mood to use the present economic crisis as an occasion for the radical overhaul in the American state, in a way that dramatically redistributes costs and benefits.

Paul Ryan's radicalism is the radicalism felt by many affluent Americans. They look into the future and see ever-accumulating costs and burdens for themselves to support the less affluent. Back in the more prosperous days of 2003-2006, they could contemplate that future more calmly. But now - in an economy only very fitfully recovering from the disasters of 2008-2009, led by a president who clearly envisions large tax increases on them as his primary means to reduce the federal budget deficit - they are gripped by something close to panic. The radicalism of the Ryan plan speaks to that panic.

The Ryan plan says to most Americans under age 55: "get ready to pay for your own damn Medicare."

Its tax message speaks even more explicitly to the preferences of upper America. Imagine an investor living in Greenwich Connecticut. Earns some millions a year, lives in a house worth $8 million or more.

The Ryan plan offers him a substantially lower income tax rate. More important, the Ryan Roadmap urges the retention of the capital gains rate on longer-term gains at the present very favorable rate of 15%.

What does it ask in return?

He'll have to pay more for post-65 health coverage. That's easy.

He may lose some or all of the ability to deduct his Connecticut income taxes and Greenwich property taxes from his federal income tax. Vexatious, but worth it.

The ceiling on the maximum deductible mortgage may be reduced some more, from the present $1 million down to ... well who knows where. Again vexatious, but ditto: worth it.

All in all, it's a very attractive proposition for this person. As he weighs it, his mood becomes less apocalyptic, more cheerful. If a candidate will give him the Ryan plan, then he doesn't much care what the candidate says about abortion, gay rights, the environment, etc. The GOP on which he soured during the Bush years suddenly looks like his party again. He can vote contentedly for any candidate who'll endorse this offer: Romney, Huntsman, Pawlenty, Christie, Perry - he may slightly prefer one or another, but they'll all more or less do. As for Sarah Palin? From this person's point of view, her 15 minutes are so over!

Click here for part three.

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