What’s New (and Not) in the House Budget Committee Plan

I feel sorry for progressive analysts and advocates whose main business is the federal budget and related issues because they again have to swat down pernicious proposals and misleading justifications.

I myself am tired of blogging on the retreads we see in the proposed House budget resolution — the immediate occasion of my pity and exasperation that I suspect is shared.

So what’s new? A few things that would devastate programs for low-income people, as well as some not new.

Vast Spending Cuts

The Washington Post has repeatedly reported that the House budget plan would cut spending by $30 billion over two years to offset what last year’s budget deal allows above the caps originally set for the upcoming fiscal year.

This is doubly misleading, though not, I think, intentionally. First off, the deal has already offset that $30 billion, though the savings reach the total over a longer period of time. Second, the plan would actually cut spending by $6.5 trillion during the next 10 years, the usual window for budget-related estimates.

The massive cut isn’t new. Nor the justification for it. The plan, like its recent predecessors aims to balance the federal budget, without raising more revenues.

It would, in fact, raise less than likely now because it would eliminate taxes on all profits corporations claim to earn overseas and the Alternative Minimum Tax collected from well-off individual filers who benefit from the lower capital gains tax rate, plus diverse deductions and credits.

Where the “Savings” Would Come From

The House Budget Committee finds roughly a sixth of its savings in discretionary programs, i.e., those that depend on annual appropriations. Most are subject to the caps, while only a few others are.

The plan provides for spending up to the somewhat higher caps agreed to for the upcoming fiscal year. But it doubles down in the years following, while boosting spending on defense even more than the budget tables show.

Spending on non-defense discretionary programs would fall by about $1 trillion below the current caps, according to a Center on Budget and Policy Priorities estimate.

These programs include a wide variety that serve low-income people’s immediate needs, e.g., affordable housing and child care, help with home heating bills. Others offer them or their children opportunities to improve their earnings prospects, e.g., job training, work-study for college students.

Most have already lost real-dollar value since the year before Congress passed the law that imposed the caps, as the Coalition on Human Needs shows.

A much bigger chunk of the savings would come from changes in mandatory programs, i.e., those the federal government must spend enough on to provide full benefits authorized by laws other than a budget.

What’s not new is a sketch of sorts for partially privatizing Medicare. Likewise proposals to convert Medicaid and SNAP (the food stamp program) to block grants.

The former would reduce federal spending by more than $1 trillion, the latter by $125 billion — nearly a third during the block grant’s first four years. Another $25 billion or so saved by not-new proposals House Republicans tried to get into the latest version of the Farm Bill.

The block-granting impacts are self-evident, as they’ve always been. Either states would have to use significantly more of their own funds to sustain the same benefits to the same groups now eligible or they’d have to cut benefits, deny them to some or a combination of both.

What’s sort of new is the re-branding. The undermined programs wouldn’t be block grants, but rather state flexibility funds, the more palatable term the House Budget Committee adopted last year.

I’ll have more to say about the Committee’s plans for healthcare programs because the not-new proposal to repeal the Affordable Care Act and a separate effort to undermine it pose broader threats than the block grant in and of itself.

I’ll just cut to the chase here in hopes of answering a question I’m guessing is on the minds of those of you still reading what seems the same old, same old with new numbers.

Why Worth a Worry

The House Budget Committee’s plan won’t develop into next year’s budget — or the many legislative changes needed to gut the mandatory programs. It may not even pass in the House because some of the Tea Partiers feel it doesn’t cut spending enough.

If it does pass, it won’t in the Senate, even if all Republicans there vote for it because they’d need at least six Democrats to join them. Lotsa luck there.

Yet I think the analysts and advocates I pity are right to not just shrug off the plan as a waste of their energies and time. Set aside, if we can, the upcoming elections.

When state flexibility funds, attacks on the ACA and other radical spending cuts resurface year after year, they become familiar in a way that doesn’t breed contempt. They gain a sort of tolerance — as negotiable perhaps or at least due the deference we generally accord debatable propositions.

Not saying all is right with all the programs the federal government funds. But the notion that it should leave the well-being of low-income and other disadvantaged Americans to the states they live in — and whatever those states can and choose to spend — seems to me fundamentally wrong.

This is not a notion that should cease to shock just because it’s teed up year after year, with new wrinkles and rhetorical flourishes.

All told, the House budget plan would cut spending on programs for low-income people by $3.5 trillion over the next 10 years — about 40% of what’s spent now or nearly one and a half times their share of non-defense spending.

And that should shock as much as the House Republican majority’s first budget plan — the ironically entitled Path to Prosperity — did.

 

 

 

2 Responses to What’s New (and Not) in the House Budget Committee Plan

  1. […] I drafted my post on the House Budget Committee’s plan, I discovered that its impacts on affordable health care […]

  2. […] as I’ve said before, the House budget plan won’t become the budget for the upcoming fiscal year. But it […]

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