UPDATE 11-Romney's choice of Ryan reshapes race for White House
* Choice of congressman aimed at energizing conservatives
* Democrats relish battle over Ryan budget
* Romney kicking off four-state bus tour
By Steve Holland
NORFOLK, Virginia, Aug. 11 (Reuters) - Republican presidential candidate Mitt Romney's selection of Wisconsin Congressman Paul Ryan as his vice presidential running mate could dramatically shift the race for the White House into a debate between two sharply contrasting views of government spending and debt and its role in the daily lives of Americans.
In choosing Ryan - a budget hawk whose provocative plan to reduce government spending has won him fans in the conservative Tea Party movement and made him a target for Democrats - the typically cautious Romney on Saturday took the biggest gamble of his year-long candidacy.
Romney also essentially acknowledged that the core argument for his campaign - that Democratic President Barack Obama's stewardship of the economy has failed - may not be enough to push Romney to victory in the Nov. 6 election.
So he has embarked on a high-risk, high-reward strategy of aligning himself with Ryan, whose budget plan would cut taxes and restructure Medicare, the popular government-backed health insurance program, and other safety-net social programs to try to inspire investment and rein in runaway government spending.
Democrats say Ryan's plan would amount to draconian cuts in programs that help protect the nation's most vulnerable people.
Democrats - whose platform focuses on middle-class tax cuts, higher taxes for the wealthy and a healthcare overhaul that requires most Americans to buy insurance - already are blasting Romney for picking Ryan, and vowing to cast Romney as an enemy of programs that benefit the poor and elderly.
The potency of such an argument by Democrats - particularly in crucial states such as Florida, which has a large elderly population - was clear on Saturday.
Shortly after he announced Ryan as his running mate before a cheering, flag-waving crowd in front of the battleship USS Wisconsin, Romney's campaign emphasized to reporters that picking Ryan did not mean that Romney supported his entire budget plan.
Romney, the campaign said, would be issuing his own fiscal plan later.
Romney needed a burst of energy for his campaign after falling behind Obama in recent polls.
He chose Ryan, the chairman of the House of Representatives Budget Committee, after ruling out more conventional candidates - such as Ohio Senator Rob Portman and former Minnesota governor Tim Pawlenty - whose impact on the race likely would have been more benign.
Welcomed onstage by Romney on Saturday, Ryan said the United States is in a "dangerous" moment of trillion-dollar budget deficits and rising national debt.
"We're running out of time and we can't afford four more years of this," said Ryan, 42, who has been in Congress for 13 years. "Politicians from both parties have made empty promises which will soon become broken promises with painful consequences if we fail to act now."
And Ryan, in what could be taken as an acknowledgement that the Republican campaign is willing to engage in a risky debate over spending on popular programs, said: "President Obama and too many like him in Washington have refused to make difficult decisions, because they are more worried about their next election than they are about the next generation.
"We won't duck the tough issues," Ryan said. "We will lead. We won't blame others; we will take responsibility."
Ryan, a Catholic who is a fitness aficionado and avid deer hunter, has many fans in the anti-tax, limited-government Tea Party movement, although some activists have not forgiven him for voting for a $700 billion Wall Street bailout in 2008.
He drew his biggest reaction when he said that "our rights come from nature and God, not from government."
His selection drew fire from Democrats, who said they relished the opportunity to showcase Ryan's proposed reductions for Medicare and other social programs.
"Mitt Romney has chosen a leader of the House Republicans who shares his commitment to the flawed theory that new budget-busting tax cuts for the wealthy, while placing greater burdens on the middle class and seniors, will somehow deliver a stronger economy," said Obama campaign manager Jim Messina.
Several Democrats have said that among the potential running mates for Romney, Ryan was the one they most wanted to face because of his harsh budget proposals.
Other Democrats questioned why Romney, who made a series of gaffes in a recent overseas trip designed to show he could handle foreign relations, would pick a running mate with virtually no experience in foreign policy.
Even some Republicans - wary about how Ryan's selection would be perceived among older Americans who rely on government-backed health and retirement programs - are concerned that Romney might be taking too much of a gamble with this choice.
Republican strategist Juleanna Glover said that Obama's campaign will bash the Ryan budget plan but picking Ryan gives Romney a defense against critics who have questioned what the former Massachusetts governor stands for.
"This gives Romney something no amount of ads have been able to do - the ability to stand for something," Glover said. "The greatest handicap in his political career has been erased."
ROUGH TIME FOR ROMNEY
The Ryan choice comes during a period in which Romney - a former private equity executive with an estimated net worth of up to $250 million - has been on the defensive over Democrats' questions about how much he has paid in income taxes.
Romney has refused to release more then two years of his tax returns, leading Democrats to say he has something to hide about his vast wealth, which included a Swiss bank account and accounts in offshore tax havens.
Polls suggest Obama has been helped by Democrats' efforts to cast Romney as a wealthy former executive who is out of touch with middle-class America.
For Romney, an outsider to Washington, Ryan would provide some expertise in dealing with Congress. But Ryan is a Washington insider without business or executive experience.
Unlike many of his colleagues, who made their names at home and then came to Washington, Ryan got his start as a Capitol Hill intern and aide, went back to Janesville, Wisconsin to run for office and was elected to Congress in 1998.
That is in sharp contrast to Romney, who has been critical of Washington insiders and says his years in private equity as a founder of Bain Capital have given him insight into the needs of U.S. businesses.
That inconsistency on the Republican ticket could be a problem, some analysts said.
The vice presidential announcement, at the start of a four-day campaign tour through the crucial states of Virginia, North Carolina, Florida and Ohio, could give Romney some momentum and energize conservatives who still view him warily.
It is likely to add excitement for the conservatives who make up the party's core and will be out in force at the Republican National Convention - where Romney will officially be named the party's presidential nominee - in Tampa, Florida, in the last week of this month.
"We are offering a positive, governing agenda that will lead to economic growth, to widespread and shared prosperity, and that will improve the lives of our fellow citizens," Romney said.
The announcement thrilled conservatives whose Midwestern home state favors the Democrats but which could now be in play with a native son on the ticket.
"This is excellent news. I'm excited. I'm in tears," said Joanne Terry, a Tea Party organizer in Ozaukee County, north of Milwaukee. "Weighing the options, he (Romney) was the best, but now with Ryan, he is definitely the best."
South Carolina-based Republican strategist Adam Temple said the choice of Ryan suggests Romney is thinking beyond November.
"Any choice Mitt Romney had to make carried risks, but the reward is greater in this case. Paul Ryan has a clear understanding of the economy and how to improve it, one of Mitt Romney's top priorities, and they both have demonstrated chemistry on the campaign trail," he said.
FORMING A TEAM
Romney and Ryan bonded during the Republican primary battle in Wisconsin last spring when Ryan enthusiastically campaigned with the 65-year-old candidate.
But their personal chemistry does not mean Romney endorses all aspects of the Ryan budget, Romney aides said.
Ryan began work on a budget blueprint of his own before Republicans captured the House in the 2010 mid-term elections, but it got little attention from Republican colleagues, who were not interested in associating themselves with a detailed list of budget cuts.
By the fall of 2010, however, the budget - and the deficit - had become defining issues, in part due to the Tea Party.
After Republicans took control of the House in January 2011, Ryan became chairman of the House Budget Committee. Suddenly he was one of the Republican Party's most visible leaders, and a frequent guest on cable news.
Ryan's budget plan passed the Republican-controlled House of Representatives last March, despite significant Democratic opposition. It went nowhere in the Democrat-led Senate.
His plan would set up a voucher-like system for the Medicare program to help beneficiaries buy private health insurance or give them access to the traditional fee-for-service plan.
Another controversial portion of Ryan's budget is to reduce the cost of Medicaid, the federally backed healthcare plan for the poor, by turning it into a block grant program for states.
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