Congressional budget aims to cut Medicare, food stamps

Both House and Senate budget plans due to be released later this week are expected to be highlighted by spending cuts to major domestic programs.

Congressional support for deficit reduction is higher than it’s been since the mid-1990s. The long-term budget goals will include a reduction in funding to Medicare, Medicaid, Obamacare subsidies, and the SNAP program (food stamps) by $5 trillion over the next 10 years, in order to keep federal expenditures in line with revenue without a further increase in tax rates.

On the defense side of the budget, Republicans in Congress have the opposite goal.

Since 2011, the Pentagon has been subjected to automatic spending cuts as a result of the debt-ceiling compromise and will reduce defense spending by $54 billion this year. It will also stunt the president’s 2016 military budget request by $38 billion.

GOP members in the House and Senate, especially hawks like John McCain, are trying to reverse the sequestration cuts. Such a feat was achieved two years ago which served to limit the cuts for the 2014 and 2015 defense budgets. McCain won’t accept even partial cuts:

“If we’re going to have a lower (defense) number than the president of the United States is proposing, we have no credibility on saying that we are committed to defending this nation.” he said. “It will devastate . . . our ability to defend the nation. . . . You can’t (cut Pentagon spending) and claim that you care about national defense.”

In order to pay for funding increases to the Pentagon without raising taxes, some House Republicans on the Budget Committee are suggesting that Medicare be transformed into a private-public partnership program through the issuance of vouchers which the recipient could use to purchase health insurance from the carrier of their choice.

Such a switch to the private market would decrease federal costs but subsequently increase costs for beneficiaries. SNAP and Medicaid are also slated for a major tweak by the committee, which is proposing they become federal-grant programs run by the states, which will make future cuts in their funding more politically digestible.

 

[AP] [Photo courtesy Noorullah Shirzada/AFP/Getty Images]

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