'Default Not Our Strategy' in Getting Spending Cuts: Ryan
Before approving a raise in the debt ceiling congressional Republicans want at least the same amount in spending cuts, Rep. Paul Ryan told CNBC.
Ryan, head of the House Budget Committee, said attaching conditions to raising the nearly $14.3 trillion national debt ceiling is the only way the GOP can get Democrats to rein in the spending that has led to the spiraling debt and deficit problem.
"We want to get real spending cuts with real process reforms that lock in and guarantee those spending cuts," he said in a live interview. "We see this as a necessary down payment on getting the debt under control and heading in the right direction. That will calm markets. We think that will buy us time in the credit markets."
The two parties have been locked in a debate as the debt ceiling reaches its limit and the US faces a theoretical threat of default on its debt obligations.
Ryan, of Wisconsin, drew criticism several weeks ago when he suggested that should Washington not raise the ceiling that its creditors wouldn't mind if the US missed paymentsas long as progress was being made toward controlling spending.
On Monday, he said default is not the goal but vowed that Republicans would remain steadfast in addressing the debt and deficit issues.
"Default is not our strategy. Nobody wants to see that happening, but we don't want to see both political parties show the world and the credit markets that we just can't do anything about spending, that we just throw in the towel on America because we can't get our fiscal house in order," Ryan said.
Ryan has proposed a budget that cuts $6.2 trillion in spending that has been rejected so far.
Jared Bernstein, former economist for Vice President Joe Biden, called the Republican plan "Robin Hood in reverse" and said it was more of the same methods used during former President Ronald Reagan's time in office during the 1980s.
"Trickle-down economics didn't work in the '80s, it didn't work in the 2000s. The opposite worked in the '90s," Bernstein said. "The idea of slashing spending, hurting the most vulnerable people in the economy by cutting Medicare, college tuition, food stamps...this is your own version of class warfare."
Ryan took the opposite tack, saying that continuing to throw money at the economy's ills hasn't worked, either.
"All this sort of demand-side Keynsian spending—borrowing and spending—it hasn't worked, it doesn't work. The multipliers they use to justify these things have been thoroughly discredited," he said. "So we want to go with what works."