The Stakes in THIS Election Could NOT be Higher!


 

The Federal budget deficit may be down, but because of all the various deficits, the debt has continued to rise under President Obama but at a much lesser rate. Evidence continues to show that the Great Recession, President Bush’s tax cuts, and the wars in Afghanistan and Iraq explain most of the deficits that have occurred on Obama’s watch.  However, Republicans continue to blame President Obama for ALL our budgetary woes, figuring if they say that enough folks will begin to believe that and once again, put them back in the driver’s seat.

AT ISSUE

On April 10, 2014, the House passed budget resolution HConRes96 for fiscal year 2015 [Vote 177: 219(R) – 205 (12R + 193D)].  That resolution has not yet been taken up in the Senate as a budget already covering fiscal year 2015 was authorized within the Bipartisan Budget Act passed in December 2013.

HConRes96 was introduced by Budget Committee Chairman Paul Ryan (R-WI). Titled “The Path to Prosperity,” this $3.7T budget blueprint outlines a House Republican wet dream for spending and tax priorities which they believe will produce a balanced budget by 2024. Overall, Ryan’s plan would cut roughly $5.1 trillion from federal spending over the next decade, with nearly $3 trillion coming from repealing the health care law, voucherizing Medicare and block-granting Medicaid along with a few other safety net programs.

HConRes96 incorporates Republican ideology with respect to spending and tax reform, imposing significant reductions to safety net programs that will affect more than just seniors.  The Republican’s tax reform act would have only two tax brackets for individuals at 10% and 25%, with the corporate tax rate at 25%. What’s unclear is whether any corporate loopholes were closed and whether even more corporations will have a net-zero effective tax rate as a result of the reduction in the corporate tax rate. House Ways and Means Committee Chairman Dave Camp (R-MI) claims the reform provisions would allow 95% of taxpayers to avoid itemizing, and instead claim a larger standard deduction. Really?  With this plan in place, taxpayers would no longer be able to claim deductions for state and local income taxes, the maximum allowable deduction for mortgage interest deductions would be lowered to $500,000 over 4 phases, and charitable deductions would be subject to a 2% of “adjusted gross income” floor for taxpayers who might attempt to claim such deductions.

HIGHLIGHTS OF THE FY2015 HOUSE BUDGET RESOLUTION

Total
Spending
Discretionary Spending
(Base Outlays)
Projected
Deficit
FY 2015 House Bgt Resolution   $3.7T $1.014T $380B
Current Policy (FY 2015) $3.8T $1.027T $485B

Budgets are a statement of priorities and clearly, Republican priorities are not in helping Americans or in maintaining our nation’s infrastructure.  Take a look:

  • The 2011 Budget Control Act (BCA) set limits or “caps” on annual discretionary funding through 2021, imposing separate caps for defense and non-defense funding. In addition, the BCA mandated automatic further reductions — called “sequestration” — after Congress failed to adopt a more comprehensive deficit-reduction plan by January 2012.  HConRes96 abides by the overall spending limits established in the BCA for FY 2015, but not in its “equal-part split provision” between military and non-military spending. Accordingly, their imposed austerity formula would reduce the discretionary budget to $310B below sequester levels through 2024.
    • Results in a net $791B DECREASE for non-defense budgets (infrastructure, education, transportation, etc.)
    • Results in a net $483B INCREASE in defense budgets (war, weapons, etc.)
    • Reduces overall discretionary spending by $5.1 trillion over ten years
  • Repeals the Patient Protection and Affordable Care Act which would eliminate provisions for the Health Insurance Marketplace, reopen the Medicare donut hole, remove provisions that allow children to remain on their parent’s policy until age 26, and allow the Insurance companies to return to their onerous practice of denying coverage claiming “pre-existing” conditions as well as not raking in excessive profits by premium overcharges (just to name a few key provisions).
  • Eliminates the Corporation for National and Community Service [It’s core programs — Senior Corps, AmeriCorps, and the Social Innovation Fund, would thus, be eliminated.]
  • Makes use of “dynamic scoring” (a time intensive process) for the first time—the macroeconomic effects of which are highly uncertain since just some (not all) of the channels through which proposed policies would affect the economy were considered.
  • Assumes an additional $175 billion in deficit reduction from a “fiscal dividend”

Sequestration
The HConRes96 budget plan matches the total FY 2015 discretionary spending cap established in the Bipartisan Budget Act of 2013, which set separate caps for defense and non-defense discretionary spending. For fiscal years 2016-2024, the plan reduces total discretionary spending caps $310B below the sequester levels, entirely derived from cuts to non-defense programs. Additionally, the plan repeats a maneuver seen in previous budgets to shift $483 billion of sequester cuts from defense items to non-defense ones, thereby restoring defense budgets to pre-sequester levels. Non-defense discretionary spending would remain $1.15 trillion below pre-sequester levels.

Taxes
HConRes96 calls for comprehensive tax reform to simplify the tax code and thus lower rates for individuals and businesses. Basically, they intend to reduce revenues remitted to the government anticipating that growth will be spurred on.  That premise hasn’t worked since it was introduced by St. Reagan as a sure-fire method to fix all our nation’s ills, but no matter, they plan to

  • Replace the current individual income tax structure with two rates: 10% and 25%,
  • Reduce the corporate tax rate to 25% (no mention of closing tax loopholes), and
  • Repeal the alternative minimum tax (AMT) which was originally designed to keep wealthy taxpayers from using loopholes to avoid paying taxes.

Entitlement / Mandatory Spending Reform
HConRes96 calls for a number of changes to entitlement programs that predominantly serve low-income populations and seniors.

Medicaid

HConRes96, if enacted would convert the Medicaid program into a “block grant program.”  But that Medicaid expansion that provided millions with access to healthcare — that would be rolled back and not funded via their fixed-value block grant program.  Republicans claim much of Medicaid spending is wrought with waste and fraud because the federal bureaucracy can’t provide adequate oversight.  Thus they believe that by “block granting” funds to each state, it would give them more flexibility to tailor their Medicaid programs to “empower recipients to get off the aid rolls and back on the payroll.”

Supplemental Nutrition Assistance Program – SNAP (food stamps)

HConRes96, if enacted would convert the SNAP program into a “block grant program” as well.  Once again, Republicans believe SNAP suffers from a flawed structure that promotes fraud and abuse.  Thus, they believe that if States receive more money if they enroll more
people in the program—so their incentive is to get people onto the rolls.  To remedy that perceived problem, this budget would require that eligibility be indexed to inflation, that time limits be imposed on eligibility and that eligibility must be conditioned on work requirements (no exception is noted in Rep. Ryan’s Path to Prosperity explanation for HConRes96 as to those who may be physically disabled and incapable of “working”).

Temporary Assistance for Needy Families (TANF)

HConRes96 rescinds any authority the administration thinks it has to provide for waivers of the work requirement of the TANF program. It assumes that the Republican majority under President Clinton were correct in requiring robust work requirements for the TANF program—which  they believe led to the largest sustained reduction in child poverty since the onset of the “Great Society.” Again, NO exceptions are noted with respect to those individuals who may be physically disabled and incapable of “robust work requirements.”

Medicare

For all the Republican disdain regarding the Affordable Care Act Health Care Exchanges, their proposal as to how Seniors should access health care would be through “Medicare Exchanges.”  Currently, administrative costs are low as there is no “profit motive” incorporated into the costs to serve our senior population.  But should the Republicans prove successful in turning over Medicare to the private sector insurance companies, the cost to serve will rise, some seniors will be forced out of the market and die because they can’t afford the premiums, the co-pays and/or the medications, and denial of services will once again become the norm that many will fight and die fighting.

While their proposal won’t affect those currently receiving Medicare, it will establish a 2-tier system, where those born in 1959 or later will be given a choice of private plans competing alongside a traditional fee-for-service option.  Once they make a choice, a voucherized premium support payment would be provided directly to the insurance provider to either pay for or to offset the premium cost of the chosen plan.

Social Security

While Rep. Ryan’s HConRes96 budget doesn’t call for direct privatization of Social Security like his past budget, this budget does call for the Administration and Congress to submit proposals to provide long-term solutions for the solvency of Social Security.

Health Care

HConRes96 would extend the Republican’s YOYO (You’re On Your Own) philosophy by repealing of the Patient Protection and Affordable Care Act as part of long-term spending reductions and savings.  They intend to replace that by enacting medical-liability reform.  In other words, by drastically limiting any compensation you might be able to get should some incompetent surgeon ruin the remainder of your life.  And then the ironies of all ironies, they propose to stomp the crap out of State’s rights argument by enacting legislation that allows anybody and everybody to buy any inadequate policy they want across any state line.


The priorities outlined in Ryan’s “Path to Prosperity” budget are not what is valued by the American People at large.  We value education for our children and jobs so we can support those same children.  We believe the income inequity between the uber-rich and the rest of us needs to be addressed and that all of us deserve a fair and equitable wage for our labors. We believe that we should all share in the cost to maintain our nation’s infrastructure regardless of one’s placement on the social ladder or that corporations need to contribute to maintenance of the infrastructure they’ve come to depend upon to bring their goods to market. We do not believe that every response to something perceived by some to affect our “national (corporate) security should be met my military force, but more frequently should be met instead with diplomacy and compromise.  And, yes, we believe that we deserve access to affordable health care at reasonable costs regardless of our ages.

Your vote in this mid-term election is critical.  If Rep. Ryan’s priorities for America don’t represent YOUR priorities for yourself and your family, then you need to make every effort to make it to the polls this election and cast your ballot accordingly.  CD2’s Rep. Mark Amodei has voted lock-step with the GOP on everything they’ve brought to the floor or that they’ve tried to kill in conference committee.  If you don’t agree with the priorities set forth by the GOP leadership, then you need to cast your vote to send Mr. Amodei packing by casting your vote for Kristen Spees instead.

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