House Narrowly Approves Budget-Cutting Bill

[classicman2]

Fox News:

AP

WASHINGTON — The House on Wednesday narrowly approved Congress' first attempt in eight years to slow the growth of benefit programs like Medicaid and student loan subsidies, sending the measure to President Bush.

The bill passed by a vote of 216-214, largely along party lines. Republicans hailed the five-year, $39 billion budget-cutting bill as an important first step to restoring discipline on spending. Democrats attacked the measure as an assault on college students and Medicaid patients and said powerful Washington lobbyists had too much influence on it.

The measure is a leftover item from the GOP fall agenda. Bush is eager to sign it into law.

It blends modest cuts to Medicaid, Medicare and student loan subsidies with a renewal of the 1996 welfare reform bill and $10 billion in new revenues from auctioning television airwaves to wireless companies. There's also $1 billion in new spending to extend an income subsidy program for dairy farmers and a reprieve for physicians who had faced a 4 percent cut in Medicare fees.

The $39 billion in cuts are generally small — a 0.4 percent cut in Medicaid funding and 0.3 percent cut in Medicare over five years — compared with deficits expected to total $1.3 trillion or more through 2010. Still, the bill set off a brawl between Democrats and Republicans and whipped up opposition from interest groups like AARP.

The House passed a nearly identical bill on Dec. 19, but the chamber held an unusual revote because Senate Democrats forced technical changes that the House needed to accept before the bill could be sent to Bush's desk.

Republicans said the measure is a necessary first step to reining in the burgeoning growth of so-called mandatory spending programs like Medicare, which threaten to swamp the budget as the baby boom generation starts retiring.

"The Deficit Reduction Act :lol: :lol: seeks to curb the unsustainable growth rate of mandatory programs that are set to consume 62 percent of our total federal budget in the next decade if left unchecked," said Rep. Adam Putnam, R-Fla. He said many such programs "are outdated, inefficient and excessively costly."

But Democrats attacked the measure, especially for its cuts to the federal child support enforcement program and for allowing states to reduce Medicaid coverage and charge increased fees for the Medicaid program for the poor and disabled.

Democrats contend the budget cut bill concentrates spending cuts on vulnerable groups like Medicaid beneficiaries while protecting powerful corporate interests such as drug makers and health insurance companies, which won big victories in end-stage negotiations carried on behind closed doors.

"This is a product of special interest lobbying and the stench of special interests hangs over the chamber," said Rep. John Dingell, D-Mich.

Democrats also said the measure, when combined with an upcoming bill cutting taxes by about $70 billion, would lead to an increase in the deficit.

As if on cue, the Senate kicked off debate on a tax cut bill that would revive some expired tax breaks and safeguard millions more families from paying the alternative minimum tax. The House version of that bill would extend tax cuts for capital gains and dividends.

The powerful AARP seniors lobby, student groups, pediatricians and others have mounted a monthlong campaign against the bill, making some lawmakers uncomfortable with their votes in December.

"Over the intervening month, people that I know and respect have gone through the details of this legislation ... and they've said, 'This is really a disaster,"' said Rep. Rob Simmons, D-Conn., who switched his vote from "aye" to "nay."

Bush is anxious to sign the bill and move on to next year's budget cycle. On Feb. 6, he is to release his 2007 budget plan, which is likely to call for new cuts to benefits programs like farm subsidies, Medicaid, food stamps and Medicare. Many lawmakers and budget experts are skeptical of the chances for another budget-cut bill during an election year.

AARP is opposed to a provision tightening Medicaid nursing home care rules regarding people who shed assets to qualify for such care. It argues that money given to charities, churches and family members within the previous five years could unfairly disqualify seniors from long-term care.

Pediatricians say provisions allowing states to eliminate some guaranteed Medicaid child health care services and charge new and increased co-payments end up hurting children. Their argument was bolstered by a new Congressional Budget Office study that predicts that much of the Medicaid savings would accrue because new co-payment requirements would drive tens of thousands of beneficiaries out of the program.

Student groups charged the bill harmed college student through $11.9 billion in cuts to the student loan program, including higher fees on student and higher interest rates on parent loans. But Republicans countered that the lions share of the savings came from lender subsidies.
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[al_bundy]

so this is why my wife hasn't been making that much in her consulting gig

[VinVega]

And how many cuts came from the highest portion of the government's expenditures? My guess is none.

[classicman2]

What department are you speaking of - the department with the largest discretionary budget by far?

[VinVega]

What department are you speaking of - the department with the largest discretionary budget by far?
Yeah, the one with all the big guns. ;)

[al_bundy]

And how many cuts came from the highest portion of the government's expenditures? My guess is none.

they all did

social programs are 2/3 of spending

[classicman2]

they all did

social programs are 2/3 of spending

It depends on your definition of social spending.

The Defense Budget is by far the largest item in the discretionary budget.

Social Security is the largest item on the entitlement side - not funded by the general revenue fund as the defense budget is. That's just one of the number of reasons that Social Security, and the other trust funds, should be taken off budget. Of course the Republicans are never going to allow that, because that would make the deficit much larger - and truer to fact, btw.

[classicman2]

"The Deficit Reduction Act" - 39 billion dollars

Next week or so Bush will ask the congress for another Iraq supplemtal of 70-120 billion.

That's real deficit reduction. :lol:

[VinVega]

"The Deficit Reduction Act" - 39 billion dollars

Next week or so Bush will ask the congress for another Iraq supplemtal of 70-120 billion.

That's real deficit reduction. :lol:
Meh, the supplemental isn't part of the budget. It's play money. ;)

[CRM114]

George W. and his Republican Congress is really going to sock it to the President-elect in 2008. I get the sense 'ol W is passing the buck here. :lol: After all, they'll have a brand new Democrat to blame for all of the woes.

[JasonF]

To answer VinVega's question:

Bush to Request $439.3B Defense Budget

Feb 2, 11:12 PM (ET)

By LOLITA C. BALDOR

WASHINGTON (AP) - President Bush next week will request a $439.3 billion Defense Department budget for 2007, a nearly 5 percent increase over this year, according to senior Pentagon officials and documents obtained Thursday by The Associated Press.

The spending plan would include $84.2 billion for weapons programs, a nearly 8 percent increase, including billions of dollars for fighter jets, Navy ships, helicopters and unmanned aircraft. The total includes a substantial increase in weapons spending for the Army, which will get $16.8 billion in the 2007 budget, compared with $11 billion this year.

Senior defense officials provided the totals on condition of anonymity because the defense budget will not be publicly released until Monday. The figures did not include about $50 billion that Bush administration officials said Thursday they would request as a down payment for the wars in Iraq and Afghanistan in 2007. The administration said war costs for 2006 would total $120 billion.

The budget plan continues administration efforts to transform the military into a more efficient, agile fighting force, while also making investments in new technologies that will better equip troops to fight the global war on terror.


Defense Secretary Donald H. Rumsfeld would not provide any details of the budget Thursday but called it appropriate, adding: "We have been able to fund the important things that are needed. It is a sizable amount of money."

The budget proposal represents the fifth year in a row that spending on weapons has increased, after years of cutbacks during the 1990s.

It also provides funding for 42 Army Brigade Combat Teams as part of the ongoing effort to increase the number of combat units from 33. The expansion would allow soldiers to spend two years at their home station for every year they are deployed to a war front.

Overall, the Army would receive $111.8 billion, including $42.6 billion for personnel. The Army National Guard would receive about $5.25 billion for personnel, and the Army Reserves would receive $3.4 billion.

The documents say the budget plan will provide the funding needed to win the long war on terror, recruit and retain troops, and continue the transformation to a more agile fighting force for the 21st century.

The Army's key weapons program, the Future Combat System, will be funded at $3.3 billion, and there will be $583 million to buy nearly 3,100 more heavily armored Humvees. The budget also includes nearly $800 million for 100 Stryker transport vehicles, built by General Dynamics Land Systems.

During a speech Thursday, Rumsfeld said the Pentagon is learning to do more with less.

"We are finding ways to operate that department in ways that are considerably more efficient and more respectful of taxpayers' dollars," he said. "We are getting much more for the dollar today than we were five years ago."

In other budget programs, the Air Force will receive about $2.2 billion for the F-22 fighter - slashing the 2006 total nearly in half. The drop in funding, however, is actually a contract restructuring that would return that money - and more - over the long run by stretching out the program for an additional two years and buying four more planes. The new plan calls for buying 20 of the aircraft, built by Maryland-based Lockheed Martin, each year in 2008, 2009 and 2010, rather than 56 in the next two years.

The Navy will receive about $2.5 billion for the next Virginia Class submarine, built by Electric Boat in Connecticut and Newport News Shipbuilding in Virginia, and there is $360 million in the budget for development of the new CH53K heavy lift helicopter, built by Connecticut-based Sikorsky Aircraft for the Marine Corps.

Other programs in the budget include:

_$5.6 billion to support a wide variety of programs to address the multiple needs of military families, including child care, family counseling, tuition assistance and family centers.

_About $1.8 billion for 81 Army Black Hawk and Navy Hawk helicopters.

_$1.3 billion for five of the new Joint Strike Fighters.

http://apnews1.iwon.com//article/20060203/D8FHDGB03.html?PG=home&SEC=news

To be fair, this is what the President is requesting, not what Congress has authorized (not that I'm holding my breath waiting for Congress to cut defense spending against President Bush's wishes).

[classicman2]

Last evening the Senate passed the 70 billion dollar Bush tax cut measure which included cuts in capital gains.

They did nothing, despite Democratic protestations, about the AMT. The House version does not address AMT either.

Grassley, Senate Appropriations Committee Chairman, promised AMT would be 'dealt with' in conference.

Addendum: The Senate did pass a sense of the Senate resolution offered by the new NJ Senator Menendez concerning the AMT. That's next to doing nothing.

[VinVega]

Thanks JasonF. I'm shocked they only want to cut domestic spending, while increasing defense spending and keeping the tax cuts permanent.

They're dancing a fine line though. If they keep cutting social programs, they will be out of office. That's a fact. Joe Six pack likes his tax cut, but he likes his social programs as well. So far we've been having our cake and eating it too. Tax cuts aren't free and I suspect that the electorate will reward deep cuts in social programs with a vote out of office for Republicans if they keep it up. The Democrats need to take advantage of this, but I suspect they will fall short as usual.

[classicman2]

I await with bated breath to see if the new Majority Leader of the House is going to follow through on what the former, now indicted, Majority Leader of the House announced a few months ago - a further reduction in the top income tax rate. I think it would be honest thing to do. It would remove all doubt as to who the Republicans' tax cuts are intended to benefit. ;)

[Ranger]

"The Deficit Reduction Act" - 39 billion dollars

Next week or so Bush will ask the congress for another Iraq supplemtal of 70-120 billion.

That's real deficit reduction. :lol:
Yeah, I saw this today on the front page of USA Today - the headline - Another $120 billion sough for wars.

Unlikely, but I hope that absurd request is laughed out of Congress.

[classicman2]

Have you noticed the lack of participation of a certain group in this thread?

I wonder why?

Could it be because it's rather embarassing to them to once again see their party lying (or to be kind, grossly misrepresenting the facts) once again to the public?

:lol:

[Ranger]

They need to come up with some lame rhetoric or weak response to defend this. Give it time. Maybe another 24 hours. :)

[Canadian Bacon]

They need to come up with some lame rhetoric or weak response to defend this. Give it time. Maybe another 24 hours. :)liberal media;)

this move is the SOS for this administration

cut important programs while putting more money toward W's blood bath

To Hell with him and them !!!!!!!!!!!!

[classicman2]

Fox News:

Domestic Agencies Face Cuts Under Bush Budget

WASHINGTON — Domestic priorities like federal aid to schools and health research are squeezed under President Bush's proposed budget for next year, but funding for the Pentagon, the war in Iraq and anti-terrorism efforts get impressive increases.

Monday's budget tome will have a price tag of more than $2.7 trillion. The departments of Education, Commerce, Interior and Energy — will see their budgets, on average, frozen or cut slightly below today's already austere levels.
_____________

'We're addicted to oil.'

Cuts in the Dept. of Interior & Energy

Makes perfect sense.

[CRM114]

They need to come up with some lame rhetoric or weak response to defend this. Give it time. Maybe another 24 hours. :)

The talking points are being disseminated as we speak.

[CRM114]

I thought I saw a headline yesterday claiming Bush is asking for a 5% increase in the Pentagon budget.

[classicman2]

--Instead of pushing last year's Social Security overhaul proposal, the president is calling for creation of a bipartisan commission to study ways to deal with soaring spending for Social Security, Medicare and Medicaid.--

Now he wants a commission to study Social Security. He wasn't calling for a commission last year. What happened to make him change his mind?

[chowderhead]

DROPS in a bucket.

George W. Bush is proposing the largest (unadjusted) budget deficit in the history of the world topping out at over 423 billion this year (http://money.cnn.com/2006/02/06/news/economy/budget.reut/index.htm) even after EXCLUDING BILLIONS in new financing for the rathole that is Iraq.
This man is the complete opposite of a fiscal conservative, signing every single spending bill the Republicans have shoveled in front of his smug face. Shame on the Republicans for charging up all this debt and leaving it for future generations.

Give tax cuts to the wealthy, subsidies to oil companies who enjoy record profits, but cut aid to the poor and students that is a drop in the fiscal budget.

Shame.

[hahn]

:lol: It's so bad, it's almost surreal. I'm kind of in disbelief that this administration actually has the cajones to make this request and actually publicize it. But I guess they realized long ago that they can do anything and there will be people who support them.
-ohbfrank-

[classicman2]

The Washington Post

Budget Plan Assumes Too Much, Demands Too Little

By Jonathan Weisman
Washington Post Staff Writer

President Bush's budget blueprint would bring the federal government's budget deficit under control by decade's end. But to do that without raising taxes, the White House would need a sweeping tax reform that it has avoided proposing and a swift end to the war in Iraq.

The budget plan for fiscal 2007 underscores what budget analysts of all political stripes have been saying for years: The goals of balancing the budget, waging a global fight against terrorism and making Bush's first-term tax cuts permanent may be fundamentally at odds.

Under the budget plan, the deficit would jump from $318 billion last year to $423 billion in 2006, then slide back down to $183 billion in 2010. In 2011, the last year of the White House's projection, the deficit would again begin to rise, to $205 billion, reflecting the cost of extending Bush's tax cuts beyond their 2010 expiration date and enacting a proposed Social Security restructuring that would cost $57 billion in that year alone.

But even getting there requires some heroic assumptions.

The president's budget acknowledges the cost of Bush's call to make his tax cuts permanent -- $1.35 trillion over the next decade and nearly $120 billion in 2011 alone. But beyond 2007, the budget assumes no military expenditures in Iraq or Afghanistan and no effort to address the unintended effects of the alternative minimum tax, a parallel income tax system that was designed to hit the rich but has instead increasingly pinched the middle class. It also assumes Congress will cut domestic spending every year after 2007.

Those factors led Goldman Sachs economists to tell clients yesterday that the deficit forecasts are "unrealistic."

White House Budget Director Joshua B. Bolten said that something must be done about the AMT. But beyond 2007, when Bush assumes a one-year provision to mitigate the AMT's impact on the middle class, Bolten said any fix should be part of a broader "revenue-neutral" restructuring of the tax system. Such a revision, once viewed as a priority of the president's, has disappeared from Bush's political agenda.

"In the absence of even mentioning tax reform in his State of the Union address, it may be presumptuous to assume a revenue-neutral AMT fix after 2007," said Brian M. Riedl, a federal budget expert at the conservative Heritage Foundation.

The administration, for the first time, has spelled out anticipated spending on the wars in Iraq and Afghanistan in a formal budget document. Previously, the administration submitted requests for supplemental or emergency spending to cover costs. But the $50 billion in war funding for next year falls well short of the $120 billion that was requested for 2006. And no further war spending is included in future deficit projections.

"This budget is not going to happen," said Stanley E. Collender, a federal budget analyst at Financial Dynamics Business Communications. "Of all the budgets I've seen recently, this is the one going nowhere the fastest."

What is included may prove equally unrealistic, Collender and other budget experts said. The budget includes a crackdown on tax cheats that is supposed to net more than $1.5 billion over the next five years and $3.6 billion over the next decade. But if such a crackdown is in the offing, the Internal Revenue Service has said very little about it.

The president assumes that Congress will cut discretionary spending unrelated to national security from $492 billion in 2007 to $455 billion in 2011, and that lawmakers will hold the line on defense spending. Total discretionary spending -- including defense, homeland security and domestic government programs -- would fall under the president's budget from $1.03 trillion this year to $994 billion in 2011.

"Nearly all of their savings comes from this cut to total discretionary spending," Riedl said. "That does nothing for the real long-term problem," which the Bush administration acknowledges to be entitlement programs, such as Medicare and Social Security.

Many of the tough cuts the president did include were rejected just days ago, when Congress gave final approval to a major budget-cutting measure. Lawmakers left out the White House's proposals to cut agricultural price supports and food stamps, and to open Alaska's Arctic National Wildlife Refuge to oil drilling.

After a difficult political struggle that badly divided congressional Republicans, lawmakers muscled through savings from Medicaid and the State Children's Health Insurance Program, federal child support enforcement and the Pension Benefit Guaranty Corp. Before Bush has even signed that legislation, he is coming back for more. His budget proposes to wring out $4.9 billion more in savings from Medicaid and the State Children's Health Insurance Program, $17 million from child support enforcement and $16.7 billion from the federal pension insurance program through 2011.

Douglas Holtz-Eakin, the recently retired director of the Congressional Budget Office, gave credit to Bush for putting entitlement cuts on the table. But the problems with the budget -- especially in not confronting the effects of the AMT and the war in Iraq -- have cropped up time and again, Holtz-Eakin said.

"There's lots of this we've seen before, and that's what Bolten said today: 'We're going to take our priorities and stick with them,' " said Holtz-Eakin, a former Bush White House economist. "This seems familiar because it is familiar."
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