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The Democratic Strategist

Political Strategy for a Permanent Democratic Majority

Get Ready For the Real Budget Debate

Reports on what is happening with the negotiations over current-year federal appropriations are all over the place, with some suggesting an imminent deal (possibly complicated or even unraveled by revolts from both the left and right in Congress and elsewhere) and others a government shutdown. But a much bigger and more momentous battle is going to begin next Tuesday, when House Budget Committee chairman Rep. Paul Ryan finally unveils his draft long-range budget resolution.
Early indications are that Ryan will not go after Social Security benefits (other than rhetorically), but will really bring the hammer down on Medicaid and Medicare, with the former targeted for a cool trillion in cuts over the next ten years. Given the close connection between Medicaid and health reform, there’s zero question that hammering Medicaid eligibility and benefit levels will represent a collateral attack on “ObamaCare,” not to mention an opportunity to screw those shiftless po’ folks who caused the housing and financial meltdowns and stole the 2008 elections with the help of ACORN.
The overriding rationale for Medicaid cuts will be the program’s impact on state government budgets. Expect lots of talk from Republican governors about the need for “flexibility,” which can be pretty strictly translated as the “flexibility” to cut benefits. Nationally, conservatives have been longing for decades to dump Medicaid beneficiaries, typically through some “block grant” scheme that fixes federal spending at current levels (even though health care costs continue to rise rapidly) and liberates the states to make ends meet by abandoning services and those served. Ryan may propose such a block grant, or perhaps a version of the vouchers he’s already talked about using to “reform” Medicare (a tricky proposition for Medicaid since eligibility and benefit levels vary significantly from state to state, thanks to the “flexibility” already provided to states).
The impending GOP assault on Medicaid is ironic, since the program began back in the early 1960s as an accomodation of a long-standing GOP proposal for health coverage of the poor, its preferred alternative to universal health coverage.
Ryan’s treatment of Medicare will likely get more attention, and will be a lot less transparent, given the political sensitivity of cuts in a program much beloved among the GOP’s increasingly elderly base. For one thing, current beneficiaries will be “grandfathered,” with the brunt of reduced benefits falling on those qualifying for Medicare in a decade or so (this approach, which is also a standard feature of GOP Social Security “reform” schemes, hasn’t much worked in the past, viz. with Bush’s 2005 SocSec proposals).
In general, the budget debate will represent the most thorough-going conservative effort to explode the entire New Deal-Great Society legacy we’ve ever seen. We’ll also find out if Republicans are willing to look seriously at long-range defense budget reductions. The stakes couldn’t be much higher, particularly if you consider that a growing number of conservatives are linking votes for a public debt limit increase to acceptance of their “big ideas” on the budget. Indeed, it may well be that conservatives are switching their planned maximum temper tantrums from the short-term appropriations bill to the long-term budget measures.
I know many progressives are demoralized by the White House’s handling of the appropriations negotiations, and of other issues like Libya. But believe me, the fight that’s about to begin over the budget will make the appropriations wrestling match look like, well, a wrestling match, compared to the open warfare just on the horizon. And no, I do not think there is any significant chance that the president, regardless of his willingness to talk about “entitlement reform,” is going to “cave” and accept a Medicaid block grant or a voucherization of Medicare, particularly if Republicans predictably continue to oppose a restoration of Clinton-era tax rates for the wealthy and insist on repealing health reform.
So get ready for the real budget debate.

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