Morning Roundup: House GOP's Unrealistic, Unworkable Budget
Yesterday, House Republicans unveiled their 2016 budget resolution, filled with the same partisan rhetoric and gimmicks we’ve come to expect from the GOP. Instead of making the tough choices needed to invest in our economy and expand middle-class opportunities, Republicans have chosen to continue the sequester this year for domestic spending, before dramatically cutting even farther below this already unrealistic level – while breaking the caps on defense. They’re also imposing the burden of deficit reduction on the most vulnerable, low-income American households. Here’s a look at how their unrealistic, unserious, and unworkable proposal is playing out in the news:
Washington Post Editorial: The GOP’s fiscal phonies
“In the face of these challenges, the majority-Republican House has produced a budget blueprint that serves no particular purpose except to demonstrate the inadequacy of pure, no-tax-increases GOP policy doctrine. To be sure, the document calls for an essentially balanced budget by 2025, which would reduce debt held by the public to 55 percent of GDP. It achieves this, however, entirely by cutting scheduled spending by $5.5 trillion , the largest chunk of which would be a $2 trillion 10-year savings from repealing the Affordable Care Act — which is neither sensible nor politically feasible.”
“Another $900 billion would come from converting Medicaid to a block grant program administered by the states, which also isn’t going to happen under a Democratic president, if ever. Meanwhile, the House GOP would reduce the discretionary budget by $372 billion over the next decade, which results from tightening all non-defense accounts by $759 billion beyond the existing unsustainable sequestration plan and shifting about half those savings to the defense budget.”
“Given the enormous cuts this would imply to the courts, parks, FBI, water projects and a host of other useful and — even in red states — popular programs, the GOP approach wouldn’t be desirable even if it were politically possible. In fact, Republicans themselves are deeply divided over how to prevent further cuts to defense spending under the sequester law, to the point where the budget plan’s GOP authors resorted to a gimmick — tucking in $36 billion of ‘emergency’ defense spending for fiscal 2016, over and above President Obama’s $58 billion request, to evade the impact of the sequester.”
“The fatal flaw in their plan, however, is its assumption that the U.S. government already collects the optimum amount of taxes given its foreseeable responsibilities.”
“That is not only a financial and political mistake but also a moral one, given that the only alternative is to balance the budget through sacrifices in the domestic budget, including programs for those who need help the most.”
The New York Times Editorial: The House Budget Disaster
“If the budget resolution released on Tuesday by House Republicans is a road map to a ‘Stronger America,’ as its title proclaims, it’s hard to imagine what the path to a diminished America would look like.”
“The plan’s deep cuts land squarely on the people who most need help: the poor and the working class. The plan also would turn Medicare into a system of unspecified subsidies to buy private insurance by the time Americans who are now 56 years old become eligible. And it would strip 16.4 million people of health insurance by repealing the Affordable Care Act (the umpteenth attempt by Republicans to do so since the law was enacted in 2010).
“House Republicans would increase defense financing by bolstering a contingency fund that is not subject to existing budget caps, while insisting on adherence to caps or even deeper cuts to nondefense spending on education, the environment, law enforcement, medical research and other so-called discretionary programs. At the same time, the plan proposes deep cuts to ‘mandatory’ nondefense spending, which includes Medicaid, federal pensions, food stamps, farm supports and tax credits for the working poor. The details of these cuts are vague, but the Medicaid cuts alone would inevitably fall on millions of children in low-income families and millions of older people (mostly women) in nursing homes, groups that are the program’s main beneficiaries.”
“Over all, at least two-thirds of the $5 trillion in cuts over 10 years would come from programs that focus on low- and modest-income Americans, even though such programs account for less than one-fourth of all federal program costs.”
“Republicans say the cuts are necessary to reduce the deficit and balance the budget, but annual budget deficits have fallen steeply during the Obama years. Going forward, there is both a need and an opportunity for the government to spend in ways that create jobs and lay a foundation for future growth, say, by investing in education, science and infrastructure. And even if cutting the budget were urgent — which it is not — the House Republican plan ignores the most sensible, equitable cuts.”
“For example, it doesn’t propose to reduce the deficit by closing tax loopholes that drain the budget of more than $1 trillion a year and that overwhelmingly benefit the highest-income households, including special low tax rates on investment income.”
“The absence of tax increases in the presence of deep spending cuts is a recipe for increasing both poverty and inequality. But the budget plan blithely predicts that its policy proposals will bolster economic growth and increase tax revenues by some $140 billion over the next 10 years, leading to budget surpluses.”
“House Republicans are sticking to their tired themes of spending cuts, no matter the need or consequences, and tax cuts above all. Senate Republicans, whose budget resolution is scheduled to be unveiled Wednesday, are not expected to challenge the House approach in any major way.”
New York Times: House Republicans Propose Budget With Deep Cuts
“House Republicans called it streamlining, empowering states or ‘achieving sustainability.’ They couched deep spending reductions in any number of gauzy euphemisms.”
“What they would not do on Tuesday was call their budget plan, which slashes spending by $5.5 trillion over 10 years, a ‘cut.’”
“The 10-year blueprint for taxes and spending they formally unveiled would balance the federal budget, even promising a surplus by 2024, but only with the sort of sleights of hand that Republicans have so often derided.”
“The plan contains more than $1 trillion in savings from unspecified cuts to programs like food stamps and welfare. To make matters more complicated, the budget demands the full repeal of the Affordable Care Act, including the tax increases that finance the health care law. But the plan assumes the same level of federal revenue over the next 10 years that the Congressional Budget Office foresees with those tax increases in place — essentially counting $1 trillion of taxes that the same budget swears to forgo.”
“And still, it achieves balance only by counting $147 billion in ‘dynamic’ economic growth spurred by the policies of the budget itself.”
“‘I don’t know anyone who believes we’re going to balance the budget in 10 years,’ said Representative Ken Buck, Republican of Colorado. ‘It’s all hooey.’”
“The plan would cut billions of dollars from the Supplemental Nutrition Assistance Program, better known as food stamps, but that was not exactly how the budget phrased the reductions.”
“Domestic programs would be cut $519 billion below the already restrictive caps set in 2011. White House officials estimated that between theAffordable Care Act repeal and the cuts to Medicaid, 37 million people would lose health insurance, more than doubling the ranks of the uninsured.”
“The most contentious area remains military spending. By increasing the so-called overseas contingency operations account, the House budget would bring total military spending higher than Mr. Obama’s request, a critical demand by some Republicans in both the House and the Senate. That war funding is not supposed to go to baseline operations of the Defense Department.”
“‘If that House wants to act that way,’ it can, Mr. McCain said, but he criticized its version as ‘not legitimate budgeting.’”
“Moderate Republicans — and Republican senators running for re-election next year in heavily Democratic states — are likely to have their own problems with the House approach.”
Washington Post: House Republican budget: There’s a mysterious $1.1 trillion in spending cuts in the House GOP’s budget
“An elusive being has haunted Washington for decades now. Part gimmick and part punctuation mark, this mysterious creature has consistently baffled researchers and budget wonks who have sought to penetrate the fields of distortion it seems to create around the federal budget.”
“‘They have a magic asterisk,’ Hoyer said.”
“The magic asterisk: The words alone are enough to strike fear into the hearts of grizzled veterans of the budget wars.”
“Hoyer was apparently not referring to an actual asterisk, but to a row of figures with the innocuous label ‘Other Mandatory’ in one of several tables at the back of the document. The numbers show that Republicans are planning to save $1.1 trillion over 10 years by reducing outlays for mandatory spending other than on health care and Social Security, a drastic reduction for that category as compared to current policy.”
“It was not immediately clear where the savings would come from…”
“Other than health care and Social Security, mandatory spending includes a range of programs such as food stamps, disability payments for veterans, the earned income tax credit, and Pell grants for college students. The budget document did not specify which would be cut.Even presuming very large cuts to these programs, though, it was still unclear how lawmakers expected to come up with $1.1 trillion, said Bob Greenstein, president of the Center on Budget and Policy Priorities.”
“By comparison, the Republican majority in the House voted in favor of reducing the budget for food stamps in 2013. The controversial measure passed only narrowly, with every Democrat and a few Republicans opposed. Many worried the cut was too severe, but it totaled $40 billion, just a sliver of the savings claimed in this week's proposal.”
Politico: GOP budget plan: Slash spending, transform Medicare, boost military
“Without the backing of defense hawks, Price, Speaker John Bohner (R-Ohio) and the Republican leadership face a near-impossible task in just getting their proposal through the House, much less reaching a budget deal with the Senate. Senate Republicans are to unveil their own budget plan on Wednesday.”
“Failure to pass a budget would be a serious blow to Boehner and other House GOP leaders already reeling from the intraparty debacle surrounding the Homeland Security Department funding fight. Without a budget, they would not be able to use ‘reconciliation’ — a tool that allows for a simple majority vote — to repeal Obamacare or enact tax reform. That means any such legislation would need 60 votes in the GOP-controlled Senate.”
Politico: Senate GOP blasts House plan to boost defense budget
“Senate Republicans on Tuesday panned a House GOP strategy to dramatically boost defense funding by using a contingency fund for war spending — setting up a major clash between the two chambers as the new GOP-controlled Capitol tries to agree on a budget this year.”
“‘It is a gimmick,’ Idaho Sen. Mike Crapo, a member of the Budget Committee, said Tuesday. ‘To use it in that way, I oppose it.’”
“Sen. John McCain (R-Ariz.), the powerful chairman of the Senate Armed Services Committee, has also said he opposes using the OCO funds for boosting defense, also labeling it a ‘gimmick.’ He said Tuesday that he was working on a budget blueprint that wouldn’t rely on emergency war spending.”
“‘OCO has become a slush fund,’ added Sen. Jeff Flake (R-Ariz.). ‘We’re starting to put State Department funding in OCO. I mean, this is stuff that we know, we’ve budgeted for years before and we just put it to be able to raise the cap on everything else. It’s really, unfortunately, a growing gimmick.’”
“How to ease strict spending limits on defense has become by far the thorniest issue for Republicans as they attempt to produce a budget agreement between both chambers. Particularly in the House, the chasm between defense hawks and fiscal conservatives is a worrying development for GOP leaders trying to corral 217 votes on their budget — a partisan document that also lays out the party’s governing philosophy.”
Washington Post: GOP budget sets up fight between deficit hawks and defense hawks
“If Republicans fail to approve a compromise budget that passes both the House and Senate — a real possibility, given their deep divisions on fiscal policy — it will be an ignominious defeat for House Speaker John A. Boehner (R-Ohio) and Senate Majority Leader Mitch McConnell (R-Ky.). Those two leaders have made steady governance with a conservative tilt their main political goal of the year. But without a budget resolution, the funding process would be particularly unsteady and increase the possibility of at least a small-scale shutdown of parts of the federal government in October.”