Anatomy of a Budget: The Plans that Drew GOP Defections and No Dem Crossovers
WASHINGTON – Unless you consider words like “repugnant” and “dangerous” to somehow be complimentary, it’s obvious congressional Democrats are less than enamored with Republican plans for the federal budget.
In the House on Wednesday, no Democrats voted for the bill and 17 Republicans crossed the aisle on the 228-199 vote. Usually it's the fiscally conservative Dems who cross over to vote with the GOP.
After a marathon session of amendments and a 3:30 a.m. vote, the Senate passed the budget 52-46, with Sens. Rand Paul (R-Ky.) and Ted Cruz (R-Texas) casting "no" votes (Cruz said it didn't include "meaningful entitlement reform") and Sens. Dianne Feinstein (D-Calif.) and Barbara Mikulski (D-Md.) skipping the vote. White House press secretary Josh Earnest issued a statement calling the budget full of "gimmicks."
The budget committees in both the House and Senate issued separate blueprints, with the GOP majority in the House seeking to balance the budget in nine years by cutting spending by $5.5 trillion while the Senate seeks to accomplish the same goal over 10 years by axing $5.1 trillion.
How they intend to go about making the cuts is not always clear but programs dealing with food stamps, college assistance and those old standbys Medicaid and Medicare are in line for massive reductions along with, of course, Obamacare. And Democrats are not amused.
“It is a plan that balances the budget in less than ten years, secures and strengthens vital programs – like Medicare – provides our military men and women with the resources they need to protect American families, and would make Washington more efficient, effective and accountable to hard-working taxpayers,’’ said Rep. Tom Price, R-GA, chairman of the House Budget Committee. “In this budget, we have embraced the innovative spirit of the American people by putting forth policies that can deliver real results and that empower individuals, families, job creators and our communities to build a stronger more secure future.”
“While the rich get richer and corporate profits soar, millions of Americans are working longer hours for lower wages,” said Sen. Bernie Sanders (I-Vt.), ranking member on the Senate Budget Committee. “Despite that, this morally repugnant Republican budget protects those on top who are doing the best while attacking the needs of the most vulnerable – working families, the elderly, the children, the sick and the poor.”
Sanders said Republicans are preparing to slash Social Security, Medicare, Medicaid, education and nutrition because of “their alleged concern about the deficit.” But the majority has “no problem adding $38 billion to the deficit for increased military spending.”
Sanders’ House counterpart, Rep. Chris Van Hollen (D-Md.), was equally dismissive.
“Congressional Republicans have been quick to pay lip service to wanting to help working families – but this budget means that Americans who are working harder than ever will be getting even less,” Van Hollen said. “It does nothing to boost the paychecks of working Americans and makes it harder to buy a home. Students will see deep education cuts and college will be less affordable. And this budget takes away the tools that allow people to climb the ladder of opportunity.”
Van Hollen said the lower chamber’s spending plan also “makes it harder to have a secure retirement.”
“Seniors on Medicare will immediately pay more for preventive health services and those with high prescription drug costs will see prices skyrocket,” he said. “It will mean the end of the current Medicare guarantee and millions of seniors in nursing homes will be especially hurt by the irresponsible cuts to Medicaid.”
Sen. Mike Enzi (R-Wyo.), chairman of the Senate Budget Committee, asserted that any concerns are overshadowed by the need to balance the federal budget.
“This balanced budget delivers to hardworking taxpayers a more effective, efficient and accountable government, which supports Americans when it must and gets out of the way when it should,’’ he said. “By working together, we can deliver real solutions, real results and real progress and it is what the American people want and deserve. But first, we must find common ground and cooperate to get things done.”
Democratic opposition to the Republican budget proposals is wide-ranging:
Rep. Paul Ryan (R-Wis.), chairman of the House Ways and Means Committee, the lower chamber’s tax-writing panel, boasted that the House plan balances the budget in eight years without raising taxes.
“Our plan would balance the budget in eight years, help create jobs, and strengthen our national security—all without raising taxes,’’ he said. “We also call for Congress to fix our tax code by making it simpler, flatter, and fairer.’’
Price said House Republicans do not ask the American people “to bail out Washington with higher taxes and more debt. We take our responsibilities seriously and genuinely address the drivers of the debt.’’
“Our budget puts a premium on accountability, efficiency and effectiveness in all areas of the federal government,’’ he said. “We streamline government functions and regulatory authority to stop taxpayer dollars from being wasted on programs that are not working.
Democrats maintain the GOP majority intends to ease the tax burden on the wealthy while shifting the onus to those who make less. The House budget, for instance, eliminates the Alternative Minimum Tax, created to make sure the nation’s richest individuals pay something to Uncle Sam each year.
House Republicans also are looking to lower rates on corporations and small businesses and ignore a White House proposal to close loopholes that permit firms to deposit billions of dollars overseas tax-free, imposing a 14 percent tax on that money, thus raising $112 billion over 10 years.
Meanwhile, the House and Senate plans both phase out the Earned Income Tax Credit and the Child Tax Credit, which would in effect raise taxes on about 13 million families.
“At a time of massive wealth and income inequality, the Republicans apparently believe that the richest people in America need to be made even richer,” Sanders said. “It is apparently not good enough that 99 percent of all new income today is going to the top one percent. That’s apparently not enough. It is not good enough that the top one-tenth of one percent today own almost as much wealth as the bottom 90 percent. Clearly, in Republican eyes, the wealthy and the powerful need more help. Not only should they not be asked to pay more in taxes, the Republicans believe that we should cut tax rates for millionaires and billionaires.”
Van Hollen added that the tax cuts for the wealthy are "based on the tired and disproven theory that we can grow our economy through trickle-down economics. That theory ran aground in the real world under President Bush – the only things that went up were the incomes of the already wealthy and the deficit. Everyone else fell behind.”
The House has proposed placing a cap on Pell Grants, which are offered to low-income students who need financial assistance to attend college. The lower chamber also is aiming at substantial cuts in discretionary education programming. The Senate likewise is proposing unspecified education cuts.
Price said the budget proposal maintains the maximum award of $5,775 for Pell for 2015-2016. But the program faces funding issues and the package addresses Pell’s poor finances by maintaining the maximum award for the remainder of the budget window while targeting the program to students who need the most assistance.
But Van Hollen said cuts in students’ loans and Pell grants “will make college less affordable and add to the already huge levels of student debt.’’
“The cuts in students’ loans and Pell grants will make college less affordable and add to the already huge levels of student debt,” Van Hollen said.
Sanders argued that young people and their families “are enormously frustrated by the high cost of college education and the horrendously oppressive student debt that many of them leave school with.”
“In fact, student debt today, at $1.2 trillion is the second largest category of debt in this country – more than credit card and auto loan debt,” Sanders said. “Does the Republican budget do anything to lower interest rates on student debt? In fact, their budget would make a bad situation even worse. Does the Republican budget support President Obama’s initiative to make two years of community college free or any other initiative to make college affordable? Sadly, it does not. But what it does do is cut $90 billion in Pell Grants over a 10-year period.”
The Republican budgets begin and end, of course, by killing Obamacare, although critics note the authors of the spending packages still intend to use the savings anticipated from the Affordable Care Act for other purposes, even though that money won't be there if the law is repealed.
Killing Obamacare will also, in effect, kick about 7 million individuals off Medicaid who took advantage of the program’s expansion under the health-care reform law. The House goes beyond even that, looking to cut overall Medicaid spending and turning it into a block grant to the states.
The Senate also wants to cut Medicaid by trillions but doesn't offer a plan on how it intends to proceed. Democrats maintain those steps will assure that health care currently available for poor families will shrink.
“This budget repeals Obamacare in its entirety,” Price said. “It ends the raid on Medicare and dedicates those savings to preserving the program. It repeals all of the destructive taxes and replaces that revenue through comprehensive pro-growth tax reform. It repeals the Medicaid expansion and the newly created entitlement. Understanding that America’s health care system is in need of reform, our budget envisions starting over with a set of policies that would provide for patient-centered health care reform.”
On Medicare, House Republicans are interested in raising premiums on the wealthy but would offer individuals a lump-sum payment beginning in 2024 to end their Medicare coverage – theorizing they would use the money to purchase private insurance. GOP lawmakers in the lower chamber also want to prohibit the federal government from negotiating with drug manufacturers to lower prices. Senate Republicans, once again less clear, assert that they want to cut about half a trillion dollars from Medicare over the next decade without saying how they intend to go about it.
Price said the House GOP package “saves and strengthens’’ Medicare.
“The Medicare trustees predict that without reforms, Medicare will go bankrupt by 2030, breaking the promise to seniors,’’ he said. “Our plan would strengthen Medicare by offering future seniors guaranteed-coverage options – including traditional Medicare – regardless of pre-existing conditions or health history. All seniors will have the support they need to get the care they deserve.
Price said the House budget proposal “sets forth positive solutions to save, strengthen and secure programs like Medicare and Medicaid so they can actually deliver on the commitments that have been made to the American people.’’
Sanders said the health care cuts envisioned by the Republicans are devastating.
“We have about 40 million Americans who lack health insurance and millions more who are under-insured,” Sanders said. “Well, apparently that is not good enough for my Republican colleagues in their budget. They want to abolish the Affordable Care Act and take away the health insurance that 16 million Americans have gained through that program. In other words, instead of having 40 million people uninsured, we would have 56 million people uninsured.”
If the cuts in Medicaid are included, Sanders said, “millions more Americans would lose their health coverage. Further, when you make massive cuts in Medicaid, you also cut the nursing home care for seniors, perhaps the most vulnerable and helpless people in our country.”
FOOD STAMPS AND CHILDHOOD PROGRAMS
The House Republican budget makes deep cuts in the Supplemental Nutrition Assistance Program (SNAP) and transforms it into block grants to the states. In the Senate, SNAP is on a list of programs expected to provide $4.3 trillion in spending cuts over the next 10 years.
Price noted that the House Budget Committee has found that there are 92 different anti-poverty programs, 17 food aid programs and 22 housing assistance programs, some of which can be combined or repealed. There also exists any number of job training programs.
“By demanding Washington live within its means, we are forcing government to be more efficient, effective and accountable, providing our local communities the freedom and flexibility to improve the delivery of vital services and assistance to those in need, and saving and strengthening vital programs for America’s seniors,’’ he said.
SNAP, he said, is “a good example of a program in need of reform.’’
“Spending on SNAP has almost quadrupled since 2002,’’ Price said. “It’s grown in good times and bad, because of the open-ended nature of the program. States get more money if they enroll more people. This setup encourages waste, fraud and abuse. This budget will still spend approximately $600 billion on the SNAP program over the next decade.’’
Democrats maintain cutting SNAP will prove particularly hard on children, especially combined with other proposed cuts.
“At a time when almost 20 percent of our children live in poverty, by far the highest childhood poverty rate of any major country on earth, my Republican colleagues think that maybe we should raise the childhood poverty rate a bit higher by cutting childcare, Head Start, the Child Tax Credit and nutrition assistance for hungry kids,” Sanders said.
Both GOP proposals either freeze or slash current spending on a wide range of programs ranging from infrastructure to climate change by hundreds of billions of dollars.
Enzi said balancing the budget is simply paramount.
“Make no mistake, our fiscal outlook is grim and has been ignored for far too long,’’ he said. “But we have a profound moral responsibility to help hardworking taxpayers see the true picture of our country's finances. This is also an opportunity to make significant changes in how we do business in order to safeguard the future for our kids and grandkids.’’
Van Hollen said the package will achieve exactly the opposite.
“While this Republican budget will immediately make life harder in the daily lives of working families, it also disinvests in America’s future,” Van Hollen said. “It slashes the part of the budget we use to invest in our kids’ education – from early education to K-12 and beyond. It is a sad day when we start chopping away at the ladders of opportunity in America.”
“It will also devastate the investments America has made in scientific research and innovation – investments that have helped power our economy and keep us at the cutting edge of technology,” he said. “And it provides no solution to address the shortfall in the federal transportation fund that will result in construction slowdowns beginning this summer."