HOUSE REPUBLICANS PASS BUDGET TO SLASH TAXES FOR WEALTHY, RAISES MEDICARE COSTS FOR SENIORS AND STUDENT LOAN INTEREST RATES

By Miriam Raftery

April 1, 2012 (San Diego’s East County) – House Republicans this week passed a budget that would give massive tax breaks to the wealthy and to corporations, while weakening programs that benefit students, the middle class and senior citizens, including Medicare.

White House Secretary Jay Carney blasted the Republican budget bill that would “shower millionaires and billionaires with a massive tax cut paid for by ending Medicare as we know it and making extremely deep cuts to critical programs needed to create jobs and strengthen the middle class.”

But Majority Leader Eric Cantor (R-VA) defended the measure. “People in this country are looking, are desperate to see a strong sign from Washington that we are prepared to make the tough decisions necessary to solve the nation’s fiscal crisis."

Among San Diego’s Congressional delegation, Republicans Brian Bilbray, Duncan Hunter and Darrell Issa voted for the GOP budget, while Democrats Bob Filner and Susan Davis voted against it.

Congressman Duncan Hunter (R-El Cajon), who voted for the bill, defended the measure, noting that it “cuts spending by $5 trillion compared to the President’s budget.” According to Rep. Hunter, the measure allows seniors to opt to buy private insurance with federal incentives, or keep Medicare.

But USA Today reports the measure goes much farther.  It would repeal the President’s landmark healthcare reform measure and “turn Medicaid into a block grant program” that gives states more control on how funds are spent.  By allowing those 55 and younger to buy private insurance, it could ultimately defund Medicare over the long term.

The American Association of Retired Persons (AARP) warns that the House Republicans' budget would increase health care costs for older Americans. AARP CEO Addison Barry Rand wrote to House Budget Committee members on March 21 that “this proposal simply shifts these high and growing costs onto Medicare beneficiaries, and it then shifts even higher costs of increased uninsured care onto everyone else.”  He added, “By creating a ‘premium support’ system for future Medicare beneficiaries, the proposal is likely to simply increase costs for beneficiaries while removing Medicare's promise of secure health coverage -- a guarantee that future seniors have contributed to through a lifetime of hard work.”

The Republican budget, authored by Congressman Paul Ryan, would make Bush-era tax cuts permanent and gives tax breaks of over $300,000 to people making more than $1 million a year. 

“Just think, seniors pay $6,000 more for fewer benefits in Medicare, while they give $300,000 tax cuts to the wealthiest people in the country. You be the judge. Is that a budget that is a statement of your values?” House minority leader Nancy Pelosi (D-San Francisco) asked in a speech on the House floor. The Republican plan would also drop the corporate tax rate to 25%, while providing no revenue increase.  

By contrast, the President’s budget calls for a tax increase on the wealthiest 1% of Americans, closing tax loopholes and increasing investments in renewable energy infrastructure while protecting Medicare, student loans and other key programs.

President Obama has said his budget is based on providing a “fair shot” to all Americans.

“People in this country are looking, are desperate to see a strong sign from Washington that we are prepared to make the tough decisions necessary to solve the nation’s fiscal crisis,” said Majority Leader Eric Cantor (R-VA) in support of the bill. 

Congresswoman Susan Davis( D-San Diego), who opposed the Republican budget in the House, says 356,000 young people have gained health insurance through their parents plan thanks to the healthcare reforms, while seniors in California have saved $171 million on prescription drugs.   A telephone “town hall” survey in her district found 65% oppose repealing the healthcare reforms, which are currently being challenged at the Supreme Court. The majority (55%) thought corporate taxes should be higher, while only 20% wanted lower corporate rates.

Lori Saldaña, a Democrat running against Rep. Bilbray, called the budget “irresponsible, mean-spirited gamesmanship’ and noted it would also eliminate homebuyer programs and boost tax breaks for big corporations.  “Brian Bilbray’s vote to pass the Ryan budget…lays bare his extremist leanings,” she contends.

Scott Peters, also a Democrat in the same race, criticized Rep. Bilbray for voting to “dismantle” Medicare. “Medicare constitutes a covenant between those who’ve paid into this program their entire working lives and our government.  That covenant should not be broken,” Peters said.  “Just like last year, when he sided with big energy companies, Brian has voted with the extremists that have taken over Congress, and left our seniors to fend for themselves.”

Republicans criticize the President’s budget for having higher expenditures, a fact Democrats say will create jobs. Each party claims their plan will do a better job stimulating the economy. 

The budget has no chance of becoming law, given strong opposition by the President and the Democratic controlled Senate, but points up the severity of the partisan divide in Congress.