Sunday, June 12, 2011

Congressman Ryan and I agree about three things

Much to my surprise, during our time on a panel together in Madison last Thursday, I found him to be less of an ideologue than I expected.  I will continue to disagree with him on a "premimum support" system to replace Medicare, and I don't think his budget adds up (he never says how he gets revenues to 19 percent of GDP or discretionary spending down from 12 percent to 3 percent).  Still:

(1) He and Julia Coronado (another economist on the panel) said that increased life expectancy meant that we should raise the retirement age for qualifying for social security.  I said I agreed except for the fact that simply raising the retirement age could be regressive, given that lower income people have shorter life expectancy.  Julia said this could be fixed with different indexing for different income levels.  Congressman Ryan suggested allowing blue collar workers, whose bodies take more punishment than those of us in cushier jobs, to retire earlier.  I was pleasantly surprised at this.

(2) I suggested that regulation should be based more on metrics than fiat.  In particular, I suggested robust a meaurable capital standards for banks, and Pigou taxes for banks as they increased in size.  He said he liked the idea of regulation based on metrics, and he did not agure my point about Pigou taxes.  He also went out of his way to note that large financial institutions have the ability to capture their regulators.

(3) We were all asked to name someone with whom we often disagree who has changed thier mind about something.  Congressman Ryan named Alice Rivlin.  I can thing of many worse people to name.

He was also extremely well prepared to answer questions spontaneously, and even cited academic studies to support some of his points. 

Wisconsin Governor Scott Walker's speech at the event, on the other hand, did nothing to improve my opinion of him. 

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