According to KMUW Witchita Public Radio, Republican Rep. Paul Ryan is set to visit Kansas to fundraise on behalf of Kansas Gov. Sam Brownback’s reelection campaign. Per KMUW’s report, Ryan will headline fundraising events next week at the Wichita Petroleum Club and at a private home in Mission Hills. Ryan’s trip to Kansas in support of Sam Brownback isn’t surprising, given the fact that Ryan worked in then-Senator Brownback’s office in the 1990s.
Besides their connection from Paul Ryan’s time working for then-Senator Brownback, Rep. Ryan and Gov. Brownback are connected in a far more important way: their reliance on absolutely faulty math to do their budgeting.
Case in point is Rep. Ryan’s reliance on data that has been thoroughly debunked in regards to our nation’s ratio of debt to gross domestic product.
One of the most fearsome statistics in the war against the federal deficit has always been the country’s ratio of debt to gross domestic product. When this ratio reaches 90%, the argument goes, watch out — lower economic growth is on the horizon. And that’s scary, because that’s where the U.S. has been heading.
This idea comes from Harvard economists Ken Rogoff and Carmen Reinhart, who featured it in a 2010 paper and popularized it in a book entitled “This Time is Different: Eight Centuries of Financial Folly.”
Since then, the stat has been cited countless times, including by Rep. Paul D. Ryan in rationalizing the draconian spending cuts in his proposed budgets. Now it turns out the authors may have counted wrong.
A new study by three researchers at the University of Massachusetts finds that Rogoff and Reinhart made several mistakes that invalidate their thesis.
In their analysis of growth rates of 20 industrialized countries, including the U.S., from the postwar period through 2009, Rogoff and Reinhart excluded data for three countries that had both high debt-to-GDP and high economic growth, which contradicted their finding. They tweaked other figures in a way that minimized overall growth rates for some high debt/GDP countries.
Most important, they made a spreadsheet error that resulted in their leaving five countries out of an all-important average of countries with higher than 90% debt-to-GDP ratios. By restoring the full average, the UMass authors say, the growth rate for countries in that range becomes 2.2%, not the -0.1% cited by Rogoff and Reinhart. That makes the average growth rate at that ratio “not dramatically different than when debt/GDP ratios are lower.”
And in the case of Gov. Brownback, he relied on a budget that included a $2 billion “spreadsheet error” to tout spending cuts made during his administration that were never actually made.
While the actual state budget book was accurate, the $2 billion error in spending was incorporated into a PowerPoint chart that Brownback used for months, as he sought support for his fiscal policies from influential groups across the state, including the Wichita Metro Chamber of Commerce.
Brownback’s chart showed state all-funds spending peaking at $16 billion in 2010, the last year of Democratic Gov. Mark Parkinson’s administration. Spending that year actually was $14.04 billion.
Based on the incorrect number, Brownback claimed credit for the “first bending down of the cost curve in 40 years for the state.”
However, the corrected figures showed the state spent more under Brownback’s administration than Parkinson’s.
Given their propensity for using faulty math to their political advantage, I suppose it’s only fitting that Paul Ryan and Sam Brownback are working together once again.