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VOL. 38 | NO. 13 | Friday, March 28, 2014

GOP budget slashes spending, aid to poor

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WASHINGTON (AP) — A budget plan stuffed with familiar proposals to cut across a wide swath of the federal budget breezed through the House Budget Committee on Wednesday, but its sharp cuts to health care coverage for the middle class and the poor, food stamps and popular domestic programs are a nonstarter with President Barack Obama.

The GOP-controlled committee approved the plan by a party-line vote after swatting away numerous Democratic attempts to ease its cuts. The plan by Rep. Paul Ryan, R-Wis., the committee chairman and the party's former vice presidential nominee, promises $5.1 trillion in cuts over the coming decade to bring the government's ledger into the black by 2024.

The plan is a dead letter with the Democratic-controlled Senate and Obama, but gives Republicans a vehicle to polish their budget-cutting credentials in the run-up to fall midterm elections in which they're counting on a big turnout from GOP conservatives and the tea party.

Ryan's plan would wrestle the government's chronic deficits under control after a decade, relying on deep cuts to Medicaid, highway construction, federal employee pension benefits, food and heating aid to the poor, and Pell Grants for college students from low-income families. It would eliminate health care coverage under the Affordable Care Act while assuming the government keeps $1 trillion worth of Obamacare's tax increases, and retains a 10-year, $700 billion cut to Medicare that Democrats drove through in 2010 when passing the health care law.

Republicans say such tough cuts are required to take on chronic deficits that threaten to sap the economy of its strength in coming years as government borrowing squeezes out savings and investment and spiraling costs of federal retirement and health care programs promise to swamp taxpayers. Ryan cited Congressional Budget Office studies that show curbing deficits and debt would lead to a healthier economy in the long term — and claims $74 billion in such macroeconomic effects to promise a balanced budget in 2024.

"Just as a weak economy can drag the budget into the red, a responsible budget can help propel the economy forward," Ryan said. "If Washington is serious about helping working families — or serious about getting families out of work back to work — then it needs to get serious about the national debt."

But Democrats cast Ryan's plan as an all-out assault on the poor and working class. More than $700 billion in cuts to Medicaid over 10 years would force hundreds of thousands of seniors from nursing home care, for instance, while $135 billion cut from food stamps and other nutrition aid would increase hunger. Eliminating a mandatory funding stream for Pell Grants would mean fewer poor kids could dream of college, they said, while cuts to education, scientific research and NASA would harm U.S. competitiveness.

"This dog-eat-dog budget is nothing short of an assault on Americans struggling to stay afloat economically. It absolutely decimates safety net programs — like (food stamps) and Medicaid — designed to stop people from falling into deep poverty," said Maryland Rep. Chris Van Hollen, the top Democrat on the budget panel.

The GOP's top vote counter promised Wednesday that the Ryan budget would pass the House next week despite resistance from conservatives uneasy over higher spending for agency budgets in 2015, in line with a small-bore budget pact negotiated in December by Ryan and the head of the Senate Budget Committee, Sen. Patty Murray, D-Wash., in December.

"It'll pass," promised Majority Whip Kevin McCarthy of California.

Under Congress' arcane budgeting rules, the annual budget resolution is a non-binding blueprint that tries to set broad goals for follow-up legislation on taxes, agency spending and curbs on the growth of expensive benefit programs like Medicare, whose budgets go up every year as if on autopilot.

As such, the annual budget debate allows GOP lawmakers to go on record in favor of spending cuts big and small — whether it's slashing Medicaid, cutting subsidies for farmers and Amtrak, or further cuts to domestic agencies like the Transportation Security Administration — without having to follow through with binding legislation.

So every spring, the House goes on record to eliminate taxpayer subsidies for money-losing flights into rural airports and cut community development grants to state and local governments, for example, only to have GOP appropriators scramble to replace them later on when adopting a binding spending bill.

Ryan's budget brings back a now-familiar list of spending cuts: $2.1 trillion over 10 years in health care subsidies and coverage under the Affordable Care Act; $732 billion in cuts to Medicaid and other health care programs; almost $1 trillion in cuts to other benefit programs like food stamps, Pell Grants and farm subsidies. Hundreds of billions of dollars in cuts are not identified at all.

While repealing "Obamacare's" benefits, the GOP plan relies on its tax increases and cuts to providers to promise balance, including reductions to private insurers under the Medicare Advantage program. Republicans have attacked Democrats for the Medicare cuts used to finance the health law.

The measure also reprises a proposal to dramatically reshape Medicare for future retirees, providing those who now are 55 or younger with a federal subsidy to buy health insurance on the open market.

Republicans say that makes Medicare sustainable with savings created by lower annual cost increases than traditional Medicare. Critics cite studies that predict the voucher-like plan would mean considerably higher out-of-pocket costs as it is phased in.