The House Republican budget that Rep. Paul Ryan unveiled on Tuesday is sure to set off a debate that will spill into the presidential race and the battle for Congress in November.
Ryan’s plan would cut federal spending by $5.3 trillion over 10 years and reduce taxes by $2 trillion in an effort to reduce the huge deficit forecast for President Obama’s budget plan.
“If we don’t like the path the president’s put the country on, which we don’t, we should show them exactly how we would do things,” the Wisconsin congressman, chairman of the House Budget Committee, said on MSNBCs “Morning Joe” Tuesday morning.
The official release of the House Republican budget “launches another round of budget battles on Capitol Hill,” Politico reported.
The Obama administration already has attacked the budget plan. White House Communications Director Dan Pfeiffer said in a statement that the GOP plan “would shower the wealthiest few Americans with an average tax cut of at least $150,000,” while “undermining Medicare and the very things we need to grow our economy and the middle class — things like education, basic research, and new sources of energy.”
But in an opinion piece published by The Wall Street Journal on Tuesday, Rep. Ryan stated: “Our budget delivers real spending discipline. It does this not through indiscriminate cuts that endanger our military, but by ending the epidemic of crony politics and government overreach that has weakened confidence in the nation’s institutions and its economy.”
Ryan told reporters he has spoken with each of the Republican presidential hopefuls — Mitt Romney, Rick Santorum, Newt Gingrich, and Ron Paul — and all of them believe the House GOP budget is “heading in the right direction.” He added that he is “absolutely” confident that the candidates would accept the budget.
Ryan’s plan seeks to rein in spending on Medicare by switching the program — for those under age 55 today — from a traditional “fee-for-service” plan, with the government paying doctors and hospitals, to a voucher-like approach, with the government subsidizing purchases of health insurance.
Republicans assert that the Ryan approach forces competition on the healthcare system, reducing costs and giving seniors more options. Democrats charge the plan would reduce seniors’ options and lead to higher out-of-pocket costs.
Other provisions of the GOP budget would:
- Repeal Obamacare
- Eventually eliminate Fannie Mae and Freddie Mac
- Turn Medicaid into a block-grant program, cutting costs by $801 billion over 10 years
- Reduce the federal workforce by 10 percent over three years through attrition, and extend a salary freeze through 2015
- Restore about half of Obama’s recommended reductions in military spending and forestall defense cuts scheduled to go into effect at the end of the year
- Cut annual agency budgets, reducing outlays for food stamps, student loans, arm subsidies and other programs
- Reduce the current number of tax brackets from six to two and set rates at 10 percent for lower income earners and 25 percent for higher earners, while eliminating income tax shelters used mostly by wealthy Americans
- And cut the corporate tax rate from a maximum of 35 percent to 25 percent.
Ryan’s plan would produce a $797 billion deficit in the 2013 fiscal year, as opposed to $977 billion under Obama’s budget. The deficit would drop to $241 billion by 2016, compared to $529 billion under Obama’s plan.
Political analysts say the Republican plan has no chance of passing into law this year. The full House may vote on the measure next week, but the Democratic-controlled Senate has no plans to debate a budget.
“The budget is almost certain not to become law, given the opposition of Senate Democrats and Mr. Obama,” The Wall Street Journal observed.
“It serves more as a statement of Republican goals for the campaign and as an opening bargaining position for talks likely to take place after the election on spending, deficits and taxes.”
Sen. Patty Murray, a Democratic member of the Senate Budget Committee, called the Republicans’ plan an attempt “to appease their extreme conservative base” and charged that Republicans are “threatening families across America.”
Defending the plan, Ryan writes in The Journal: “It is rare in American politics to arrive at a moment in which the debate revolves around the fundamental nature of American democracy and the social contract.
“The president’s budget gives more power to unelected bureaucrats, takes more from hard-working taxpayers to fuel the expansion of government, and commits our nation to a future of debt and decline.
“The contrast with our budget couldn’t be clearer: We put our trust in citizens, not government.”
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