Five (of Many) Ways This GOP Budget Would Do Real Harm

Isaiah J. Poole
Jasmine Tucker, senior research analyst at the National Priorities Project, discusses the negative impact the House Republican budget would have if it became law.

The House Republican budget proposal for fiscal 2017 faces an uphill battle for approval when Congress reconvenes after the Easter recess, given that it is opposed not only by House Democrats but by a gaggle of hard-right, tea party Republicans. But that doesn’t make it politically irrelevant, and it certainly doesn’t make its ideas any less dangerous.

The policies and priorities in the House Republican budget closely mirror what would face the country if a Republican wins the White House, especially if the party retains control of the Senate. Today, President Obama’s veto pen combined with Democratic leverage in the Senate constrains how much of the House Republican agenda can actually get enacted. But what happens if that veto pen is gone?

House Republicans have in mind so many sweeping and radical changes throughout the federal government that singling out five of them only begins to capture the real harm a budget like this would do to real people, and to the country as a whole. (A broader summary of what the House Republican budget would do and how it matches up with the White House and Progressive Caucus People’s Budgets has been produced by the National Priorities Project.) But this should help voters understand how much it matters who will be in the White House and the Congress in 2017.

If this House Republican budget passed in anything like its current form:

1. The safety net would be further shredded, and Social Security and Medicare would be weakened.

There have already been real cuts in domestic spending throughout government, despite what you might hear from candidates who keep saying “government spending is out of control.” The House Republican budget would cut even deeper. In fiscal 2016 dollars, non-defense appropriations have already fallen from $586 billion in 2010 to $518 billion in 2016; House Republicans would let that figure fall to $373 billion in 2026.

Those cuts would continue to fall disproportionately upon programs intended to help lift people out of poverty – 62 percent of the cuts in fact, according to the Center for Budget and Policy Priorities.

One of those cuts would be to the Supplemental Nutrition Assistance Program (“food stamps”), which would be converted into a block grant program and turned over to the states. The states would be mandated to impose work requirements on the program – if you don’t work, you don’t eat. The rub: The budget also cuts the resources available for job training and education, and offers nothing in the way of direct job creation.

Here’s what seniors have to worry about: There is a plan to create a Medicare private insurance voucher – in their words, “premium support” – with the aim of shaving $450 billion off the cost of the program over 10 years. The budget also sets up a future assault on Social Security with its constraints on spending and on the payroll taxes on high earners that would return the program to long-term solvency.

2. Millions of people could find access to affordable health care in jeopardy.

The House Republican budget includes the expected call to “repeal Obamacare,” but it is vague in many respects on what would replace it. But one thing is clear for people who rely on Medicaid: The budget would turn that program over to the states, but with $1 trillion less funding over 10 years.

States would be free to adopt policies like that in Indiana, where Medicaid recipients have to pay a monthly premium to access many health services, no matter how poor they are. In Indiana, people who miss a monthly payment are dropped from Medicaid – no exceptions.

3. We would move sharply backward in the fight against climate change.

The House Republicans could not be more clear about how they feel about the Obama administration’s efforts to reduce carmon emissions and move toward a green economy. “This budget encourages further oil and natural gas exploration both onshore and offshore,” the budget summary says. But there’s no such encouragement for green energy: “unobligated balances from stimulus green energy programs” are cut from the budget, and there is a vow to “protect taxpayers from future boondoggles like Solyndra,” the solar company that received Recovery Act funds but nonetheless went bankrupt.

The budget also singles out the Environmental Protection Agency for what are transparently vindictive cuts, so that it does not have the capacity to take actions like holding power companies to stricter emissions standards.

4. Consumers would lose vital protections against predatory financial institutions.

The House Republican budget would seek to dismantle most of the Dodd-Frank financial reforms, but it reserves its biggest target for the Consumer Financial Protection Bureau. It accuses the agency of abusing its authority, adding that the agency “operates off-budget with little oversight from Congress or the American people.”

Perhaps Budget Committee chairman Tom Price ($45,700 in campaign contributions so far this year from banks and other financial institutions, $423,500 since 2006) is bothered by the fact that the CFPB has recovered more than $10 billion for victims of fraudulent or discriminatory behavior from financial institutions. That includes $700 million that Citibank had to pay victims of credit card fraud and the $18 million Discover Bank, the lending arm of the credit card issuer, had to pay out because of its abusive student loan collection practices.

The CFPB is able to prosecute these abuses precisely because it does not have to answer to politicians bankrolled by the financial industry it was created to police. Now Republicans (and sadly some leading Democrats) are angry that the CFPB wants to clamp down on the payday lending industry. The budget contains sneering language about the CFPB being able to “negatively access to credit for millions of Americans.” That’s code for “Let’s shut this agency down before it closes off our ability to issue loans to low-income workers at interest rates exceeding 300 percent a year.”

5. The next recession would most likely become another Great Depression.

The ultimate goal of the House GOP budget is in its name: “A Balanced Budget for a Stronger America.” To get to a balanced budget within 10 years, the Republicans would cut $6.5 trillion in projected spending during that period, while also making cuts in corporate and individual taxes, largely for businesses and wealthier households.

The budget invokes the bogeyman of a “growing national debt” that “will degrade the foundation of our economy and affect every American.” But what of the degrading of the foundation of our economy that has already happened because austerity policies imposed by the Republican Congress has kept us from investing adequate federal dollars in our infrastructure, our schools and our communities?

This budget has it backwards: The slow growth we’re experiencing is a consequence of budget austerity, not overspending. And it sets up a disaster if the economy heads into recession in the next few years. By shutting down many of the programs the Obama administration used to pull the country out of the 2008-2009 recession or sending them off in diminished block-grant form to the states, the Republican budget all but guarantees that the federal government will be unable to counter the effects of the next recession by pumping demand into the economy. Instead, as states, localities, businesses and individuals necessarily pull back on spending during a recession, the federal government would join in the pull-back. It would be a repeat of the years following the 1929 stock market crash, when a debt-and-spending averse Hoover administration catastrophically deepened what could have been a modest economic correction.

The Congressional Progressive Caucus’ People’s Budget is important because it offers a completely different, and far more sound, vision of how the federal government can help raise the wages and improve the economic security of working families, and put the economy on a more robust and sustainable footing.

Yes, the budget would increase spending by $2.4 trillion over current law over 10 years ($500 billion of that in fiscal 2017), but it would use that spending to create 3.6 million new jobs through a $1 trillion investment program, make preschool available for every child and offer all college students the choice of graduating debt free, and increase spending on child nutrition programs and nutrition assistance to people in persistent poverty. It would save money in Medicare and Medicaid by negotiating lower drug prices from pharmaceutical companies, not by cutting benefits or forcing recipients to pay more. The People’s Budget would explicitly support the movement away from fossil fuels and toward green energy sources, and would empower the Environmental Protection Agency to help keep the country on track toward meeting international climate change targets. It would require corporations and the wealthy to pay a fair share of the tax burden, and would eliminate the Defense Department’s contingency fund created to support the Iraq and Afghanistan wars, which the House budget would retain as a sort-of slush fund for the military.

As members of Congress spend some time in their districts during the Easter recess, it is a good time to let them know that the priorities of the House Republican budget are not the priorities of most working Americans – and certainly not a course that we can in good conscience follow. Signing this petition in support of the People’s Budget will also help send that message to Congress – and to the presidential candidates.

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