Budget Cop Paul Ryan: No 'Naked' Debt-Ceiling Increase, No Bailouts for States

Rep. Paul Ryan, chairman of the House Budget Committee in the new Republican era, is staking out territory as the tough new cop on the beat. In an hour-long session at the National Press Club, Ryan laid down conditions for raising the debt limit. He also said his budget won't include any money for the new health care law and he opposes bailing out states in fiscal crisis.

The country's debt is more than $14 trillion and rising, and is expected to bump up against a borrowing ceiling in early spring. Ryan (R-Wis.) said that "obviously we can't default." But he said his party won't vote to raise the limit without what he called real fiscal fixes. "I want to make sure we get substantial spending cuts and controls in exchange for raising the debt ceiling," he said.

Paul Gigot of the Wall Street Journal, the questioner at the session sponsored by the non-partisan economic research group e21, said Ryan's strategy on the debt ceiling appeared to violate the adage that you "never take a political hostage you're not prepared to shoot." Since Ryan is not prepared to allow a default, he said, "how is that a winning strategy?" Ryan said the GOP has some leverage on issues such as the amount of time the higher limit would be in force. "I can tell you one thing, Republicans are not interested in just a naked debt ceiling increase," he said.

Ryan showed little sympathy for states in the grip of deficit crises, in part because he said bailouts would explode the national debt. "If we bail out one state, then all of the debt of all of the states ... is almost explicitly put on the books of the federal government," he said. "There seems to be some sort of implicit belief that these are federally backed. They're not."

Furthermore, Ryan said bailouts would reward states that have failed to do their jobs. "Should taxpayers in frugal states be bailing out taxpayers in profligate states?" he asked. "Should taxpayers in Indiana who have paid their bills on time, who have done their job fiscally, be bailing out Californians who haven't? That's a moral hazard we are not interested in creating."

Ryan does not intend to leave states totally on their own. He said he is planning lots of hearings to get a clear accounting of "what states are in what situations, what are the timing of these things and what's the proper response" from the federal government. "But we are not interested in a bailout," he said.

House Republicans plan to vote on repealing the Affordable Care Act next week. On the assumption they'll succeed, Ryan said he won't include any money for the health care law in the budget blueprint he expects to produce in April. He said the repeal bill will not go through committees or be open to floor amendments, both new rules passed this week by the Republican majority, because "We promised the American people we were going to do this. If you say you're going to do something in a campaign, you do it when you're in office."

Follow Jill Lawrence on Facebook and Twitter