Rep. Ryan: We Are on the Path to 'Debt Ruin'

Each year, the government spends $1 trillion more than it takes in. By this summer the U.S. Treasury will have reached its legal debt limit of $14 trillion. Congress will have to approve a new debt limit or face government-wide shutdowns. Saying government has to live within its means, he called raising the debt limit a national “moral issue.”

He also warned state governments -- like California -- not to expect a federal bailout. He said some governors are insinuating that there is an implicit suggestion their debt is backed by the federal government. He retorted that they are not: “Should taxpayers in frugal states bail out taxpayers who are not in frugal states?” he asked.  No, to do so would constitute “a moral hazard.”

The new chairman also discussed finding possible common ground with the administration on trade, health care, immigration, and energy policy.

“At the end of the day, I think there are large chasms, differences of opinion of governing philosophies,” between Republicans and Democrats, he told the audience. “So I think we owe it to the country to give them a choice, an alternative future of the country,” he said. “Then they will have a very clear choice, a choice of two futures.”

The event was co-sponsored by the Manhattan Institute and E21, a new economic education non-profit.