Republicans strategists worry that it will also make it harder for the GOP to hold onto the House, a prospect that seems less likely after a recent Democratic victory in a special election outside of Pittsburgh.
Not only are donors making it clear that they are more sceptical of the effort to retain the House, but the sudden departure of Ryan suggests the Republican ideological tent will continue to shrink.
Including Ryan and Congressman Dennis Ross, who also announced his retirement today, 46 Republicans have retired or said they will not run for re-election, and those ranks are likely to grow further in the coming weeks.
A former vice-presidential nominee, the highest ranking Republican during Trump's rise and once his party's ideological standard-bearer, Ryan has spent the last two years resisting, minimising and ultimately conceding to a Trumpian revolution he could neither contain nor control.
Ryan's brand of politics, an uplifting fiscal conservatism rooted in his admiration of his former boss, Jack Kemp, seemed ascendant as recently as 2012, when Mitt Romney chose to add him to the presidential ticket. Four years later, as Trump was gaining popularity, Ryan warned the country of the divisive tactics the President continues to employ.
"Instead of playing to your anxieties, we can appeal to your aspirations. Instead of playing the identity politics of 'our base' and 'their base,' we unite people around ideas and principles," Ryan said in a March 2016 speech on the state of American politics. "We don't resort to scaring you, we dare to inspire you."
But Trump still won, not just the nomination but the White House, with a campaign that cast immigrants as inherently devious snakes and encouraged public displays of anger at protesters and the press.
The protests Ryan offered rarely had an impact. He denounced Trump's comments about a federal judge as "racist," condemned Trump's approach to trade, defended immigration as "a thing to celebrate," and continued to fight for reductions in entitlement spending long after Trump promised no cuts to Medicare and Social Security.
As recently as January, Ryan described Trump's vulgar description of some majority-minority nations as "sh******" countries as "very unfortunate" and "unhelpful."
But throughout it all, Trump's power within the party continued to grow, as Ryan's waned. National polls now show Trump enjoys dominant approval ratings among Republicans, with 86 per cent of party voters now supporting the President in the latest Quinnipiac Poll, a dramatic increase from his position before the 2016 elections.
"Republicans have united around him and his agenda at least up to this point," said Whit Ayers, a Republican pollster. "If you look at positions that Republicans as a whole have taken in the Trump era, positions they held as recently as two years ago no longer hold the same popularity."
Polls have shown increasing Republican support for expanding Social Security, a position closer to Trump than Ryan, as well as declining Republican support for free trade agreements, which were once a cornerstone of conservative economic thinking.
At the same time, Ryan has struggled to hold together a fractious GOP caucus, initially failing in his attempt to pass a repeal of President Barack Obama's healthcare law. Ryan's approval among Republican voters now hovers around 50 per cent, and his overall approval rating is below that of House Democratic Leader Nancy Pelosi in some polls.
Democrats began to evoke Ryan in campaign spots, seeing him as an easier target than Trump in some districts. "Paul Ryan is the single least popular political leader in the country," said Jeb Fain, a spokesman for the Democrat-supporting House Majority PAC, before Ryan announced his retirement. "Across demographics and districts, Ryan's less popular than Trump, and it comes down to policy."
In recent months, Ryan has generally been more frank about the tensions of his job in private. At a donor retreat last week in Austin, Texas, Ryan interviewed White House Chief of Staff John Kelly before a group of donors, according to a person who attended the event. At points, they seemed to be commiserating about the difficulty of working in the current political environment.
"The speaker and the chief of staff both talked like they had left office," said one donor who attended the event, speaking anonymously because the proceedings were private. "The speaker thanked the chief of staff for being one of the sane guys in office."
House Republicans will also now be forced to debate Ryan's replacement as their leader, even as they run for re-election. "This move by Ryan will set off an intramural food fight and take all eyes off the endgame of maintaining a pro-growth majority," said Scott Reed, a political strategist at the US Chamber of Commerce, who is planning millions in spending to defend Republican control in the House and Senate.
