Ryan: 'Plenty of room' to cut $700B from budget to extend high-end tax cuts

There's "plenty of the room" in the federal budget to cut $700 billion in spending to pay for extending high-end tax cuts, a top Republican said Friday. 

Rep. Paul Ryan (R-Wis.), the ranking member of the House Budget Committee, said on CNBC that he'd be happy to draft a budget to make cuts in spending to offset the budget gap that would be created by extending tax cuts for the wealthiest households. Those cuts are set to expire at the end of the year.

"[W]e can cut spending to pay for it," said Ryan, who would likely take over the Budget Committee if Republicans win control of the House this fall.

"That's the budget I brought to the floor last year, when we had a budget," he added. "So there's plenty of room to cut spending to accommodate those tax rates."

Lawmakers on both sides of the aisle generally favor extending most of the tax cuts for middle- and low-income workers that were signed into law by President George W. Bush in 2001. But Democrats, led by President Obama, want to let the rates spring back to their pre-2001 levels for households earning more than $250,000 per year and for individuals earning more than $200,000.

Republicans, by contrast, favor extending all the cuts, reasoning that many small-business owners count their business income as personal income, meaning higher taxes would dampen job creation. The Congressional Budget Office (CBO) has pegged the cost of extending those high-end tax cuts at about $700 billion over the next 10 years.

GOP leaders have largely sidestepped questions on how they would pay for the extension of the high-end cuts, despite having assailed Democrats for deficit spending during the past year and a half.

"Here in Washington, D.C., they — they talk about tax cuts the same way they talk about spending increases, as though the government owned all of the money. They say, 'Are they paid for?' " House GOP Conference Chairman Mike Pence (Ind.) explained, for instance, on "Meet the Press" in August. "Well, I think — I think deciding on a government spending increase is very different on whether or not we allow the American people to keep more of their hard-earned tax dollars."

Ryan said that he doesn't necessarily count himself among those who think cutting taxes will create enough revenue to pay down the difference in the budget.

"Look, I'm not one of these people who says that all tax cuts pay for themselves, but tax rates on the margin is where growth occurs, and that does make a difference," he said.

Instead, Ryan said he'd be perfectly comfortable with cutting the hefty $700 billion to pay for extending the high-end tax cuts.

"There's plenty of spending to cut to accommodate that," he explained. "So I'm more than happy to draft legislation to cut $700 billion."