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How Paul Ryan plans to tackle poverty, without cutting spending

Rep. Paul Ryan wants to change his image.

The Wisconsin Republican gained a national reputation early on in President Barack Obama's administration as a fearless deficit hawk battling to cut government spending—a profile that helped him win the vice presidential nomination on Mitt Romney's 2012 ticket.

Read MorePaul Ryan wants choice in delivering aid to poor

Now, the House Budget chairman, along with the rest of his party, seeks a broader appeal. Ryan has just unveiled a new strategy for federal anti-poverty efforts that does not aim to cut spending by a dime. Instead, it seeks to consolidate an array of programs into a single federal funding stream that states could choose to receive and then design their own programs.

"I didn't want to get into a debate about proper funding levels of the status quo because we would spend all this time talking about budget numbers," he told me in a CNBC interview. "I wanted to start a debate about how to reform the status quo. The fact of the matter is, is these reforms could occur at any spending level. You can decide later on.

Rep. Paul Ryan
Jewel Samad | AFP | Getty Images
Rep. Paul Ryan

"Let's take whatever our federal government does in these programs and keep the same level of funding for the states who choose to use the opportunity grant. Let's focus our poverty-fighting efforts, not on inputs, not on effort like how much money we spend, how many programs we create, but are we getting people out of poverty."

Ryan hasn't sworn off future cuts in anti-poverty programs. But the fact that he's not proposing them now fits the GOP's strategy to soften its image in a bid to secure a national majority. He wants his plan to start a conversation on Capitol Hill that finds sufficient bipartisan support to get at least the important parts passed.

Read MorePoll: Fewer Americans blame poverty on the poor

Once Ryan warned that government assistance represented a "hammock" that robbed recipients of the motivation needed to find work and lift their economic circumstances. Now he said that analogy was "wrong" and he merely wants to eliminate disincentives for people to move from assistance to self-sufficiency.

Ryan also tempered his language about President Barack Obama, whose policies he once said attacked "the moral foundations" of the country. Asked if he really believes that, Ryan replied: "Oh I don'tthat's a pretty broad statement. Ask me what policy you're talking about, then I'll give you a reaction. But I think his economic doctrine is the wrong way for the country."

"I think we could've done far better for economic growth. This is the worst recovery we've had on record. And I would argue this is the worst recovery we've had since World War II because of the president's policies—because of government policies, regulations, bad energy policy, no willingness to do tax reform, borrowing and spending, not getting the debt under control, loose money from the Federal Reserve."

Ryan blamed Obama and Senate Democrats for failing to accept bills to boost the economy. If Republicans gain control of the Senate in midterm elections, he predicted, unified control will enable the GOP to clear legislation through both houses and place it on the president's desk.

Read MoreRyan proposesstreamlining anti-poverty programs

Even so, he acknowledged that average voters may be right to expect that major initiatives, such as tax reform and entitlement reform, cannot be enacted until the next administration.

"I hate to think like that," he said. "Unfortunately, I think there's some merit to that criticism."

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Whether Ryan will pursue his goals on Capitol Hill or mount a 2016 campaign for the White House is still open to question. Friends say he wants to become chairman of the tax-writing Ways and Means Committee, whose current chair Dave Camp of Michigan is leaving the post, He said he won't decide for several months.

"There is a right time and place to think about those things," Ryan said. "That's 2015. I'm going to keep my options open. I am on a track here in the House that I'm pleased with. I have chosen to forgo running for other things here in the House because I like where I am."

—By CNBC's John Harwood.

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