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House Republican Plan: Slash Safety Net to Protect Military Spending
House Republicans are set to advance legislation this afternoon that would slash billions from safety net programs while protecting military spending from cuts.
The proposal includes $35.8 billion in cuts to food stamps, and $17 billion in cuts to Social Services Block Grant to states, which supports programs such as Meals on Wheels.
Reuters reports that defense spending under the GOP plan would "be $8 billion higher than levels agreed last August, rising to $554 billion in 2013."
House Democrats slammed the proposal, writing in a report on Thursday: "The House Republican budget for fiscal year 2013 reflects the Majority’s unbalanced approach to deficit reduction: they provide costly additional tax breaks for millionaires while finding savings by ending the Medicare guarantee for seniors, slashing investments that strengthen our economy, and shredding the social safety net."
Robert Greenstein and Richard Kogan write for the Center on Budget and Policy Priorities that the Republican plan "relies disproportionately on cutting assistance for low- and moderate-income families, children, and elderly and disabled people."
Watch the House Budget Committee live starting at 2PM EST.
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The Hill: House lawmakers return to deficit battle
Republican leaders are planning to bring up a $260 billion measure to slash the budget gap and replace across-the-board spending cuts set to take effect in 2013.
The bill, known as a “reconciliation” proposal, is the product of six House committees and will be combined into one piece of legislation by the House Budget Committee. Democrats have already panned it as an extension of the House GOP proposal that “reflects the wrong priorities” by protecting tax cuts for the wealthy and cutting programs for the poor.
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The cuts to food stamps, child tax credits and Medicaid healthcare for the poor, among others, are certain to stall in the Democratic-controlled U.S. Senate. But they stake out Republicans' negotiating stance on replacing $1.2 trillion in automatic, across-the-board spending cuts that are due to take effect in January. [...]
The automatic spending cuts, of which $600 billion would come from defense through 2022 - were part of last summer's eleventh-hour deal to avert an historic debt default and raise the federal borrowing cap. Congress agreed to $900 billion in immediate cuts, but a bipartisan "supercommittee" failed in its task to find $1.5 trillion in additional cuts over a decade. [...]
In addition to the food stamp savings, the six committees have proposed to eliminate social services grants to states and kill tax credits associated with Obama's healthcare overhaul law. Child tax credit refunds would be denied to those who cannot produce a valid Social Security number - a move targeting immigrants without U.S. work permits. And government employees would have to contribute more to their pensions.
The Ryan bill also takes aim at financial reforms, eliminating the government's powers to shut down large financial institutions, as well as cutting funding for the new Consumer Financial Protection Bureau. A tort reform plan to end frivolous lawsuits included in the measure would lead to lower health care costs, according the CBO.
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Center on Budget and Policy Priorities: House Budget Bills Would Target Programs for Lower-Income Families While Breaking Last Summer's Bipartisan Deal
The House Budget Committee is expected to approve on May 7 a package of two bills that would alter the bipartisan deal between President Obama and congressional leaders that was reflected in last summer’s Budget Control Act (BCA). It would eliminate the “sequestration” (automatic cuts) in discretionary programs scheduled for 2013 as a result of the failure of the Joint Select Committee on Deficit Reduction (the “supercommittee”) to achieve $1.2 trillion in deficit reduction, and replace it with a package that is strikingly unbalanced in how it affects different parts of the budget and, in particular, programs for low- and moderate-income people.
The House Budget Committee package contrasts with the Obama Administration’s proposal — which would eliminate all sequestrations through 2021 (rather than just the discretionary part of sequestration and just in 2013), and instead achieve more than the scheduled savings with a balanced package of revenue increases and reductions in mandatory programs that would not have a substantial impact on the most vulnerable families and individuals.
The legislation that the House Budget Committee will consider would also break the agreement on the BCA caps — which set separate limits on the overall amounts of defense and non-defense discretionary funding allowed each year from 2013 through 2021 — by reducing the total amount of discretionary funding allowed for fiscal year 2013 by $19 billion while allowing an increase in fiscal year 2013 defense funding above the level of the BCA defense cap. Under the BCA, a sequestration of $109 billion in fiscal year 2013, split equally between defense and non-defense programs, will take effect in January. The package before the committee would cancel the sequester of discretionary programs, leave the sequester of mandatory programs in place (except for a few small mandatory defense programs), drop the overall 2013 cap on discretionary funding below the BCA’s level, and cut mandatory programs by $324 billion over ten years through a “reconciliation” bill.
All told, the two bills would cut programs for low- and moderate-income people disproportionately and allow non-defense discretionary programs to be cut nearly as deeply as if full sequestration took place — while allowing defense funding to be boosted above the BCA’s cap and failing to close or narrow a single tax loophole. More specifically: The House legislation would repeal the BCA “firewall” establishing separate defense and non-defense funding caps for fiscal year 2013 and also cut the overall discretionary funding cap more than $19 billion below the BCA level, matching the discretionary funding levels in the budget plan of House Budget Committee Chairman Paul Ryan that the House passed in March. Under the Ryan budget, total funding for non-defense discretionary programs in 2013 would be cut below the BCA caps by almost three-quarters as much as if sequestration took effect, while defense funding would be set above the BCA cap.
If sequestration occurs, non-defense discretionary (NDD) appropriations will be cut $37.2 billion below the BCA cap, while under the House budget plan that the new package is designed to advance, NDD funding would be cut $27.3 billion below the BCA cap. In other words, overall NDD funding would be cut 74 percent as much. Meanwhile, defense would not only avoid its scheduled sequestration, it would receive $8.2 billion more than the BCA allows.
In offsetting the costs of cancelling the scheduled sequestration of discretionary programs, the new House legislation does not close or narrow any tax expenditures, and does not secure any savings from much-criticized programs like farm price supports. Instead, it relies disproportionately on cutting assistance for low- and moderate-income families, children, and elderly and disabled people. Some $128 billion of the $324 billion in mandatory program savings — 40 percent of the total — comes from cutting assistance targeted to low- and moderate-income families, including SNAP (formerly known as food stamps), Medicaid, the Children’s Health Insurance Program (CHIP), and social services for vulnerable children and elderly and disabled people.
Policymakers could cancel sequestration and offset the lost savings in other ways, including balanced approaches that raise revenues — especially by closing unwarranted tax breaks — and secure entitlement savings in ways that don’t increase poverty and hardship. The House legislation, however, charts the opposite path.