As lawmakers returned to Washington this past week, we look at how they plan to focus on Congress’ top issue, the federal deficit, and perhaps postpone any major changes to healthcare programs.
Across America, one of the chief complaints against Washington is that nothing ever is accomplished and most lawmakers are “all talk and no walk.” So, as Congress reconvened this week in the nation’s capital, the top legislative agenda has been to focus on the federal deficit and enact true reforms that will bring the United States closer to fiscal solvency. With U.S. Representative Paul Ryan (R-WI) releasing his budget last month that would have transformed the structure of Medicare and Medicaid, most observers believed major changes were in store for the government-run initiatives. But as officials met this week to begin solving their budget differences it seemed that altering such healthcare programs were suddenly off the table.
Regardless of your party affiliation it has become abundantly clear that swift action is required to begin solving America’s skyrocketing federal deficit. While Rep. Ryan’s plan would certainly take a major step forward in helping to bring our nation back from the brink, his proposal is contentious at best. Vowing to change Medicaid into a block grant system and pushing Medicare toward a more privatized approach, Ryan’s approach is not only controversial, but would also take years to push through Capitol Hill. With the United States approaching an August 2nd deadline of when the nation’s borrowing limit would be maxed out, Congress does not have the luxury of debating Rep. Ryan’s budget. A decision is needed more immediately.
While House Majority Leader Eric Cantor (R-VA) has denied that changes to Medicare and Medicaid are off the negotiating table, we should expect that no major changes to the government-run healthcare programs will be enacted at least for the time being. In fact, a deal is currently being developed between House Republican leaders and the White House that would defer such a debate until after the 2012 elections. This would allow both parties the opportunity to work together and reduce the deficit without controversy. So, if Medicare and Medicaid reform are temporarily off the table, how does Congress expect to lower the deficit? According to reports, any compromise would involve at least the follow four items:
1. Establishing firm cuts and limitations on government spending that must be reapproved on an annual basis. The Department of Defense would be subject to this same oversight as other federal branches.
2. Bringing the deficit below 3% of GDP by 2015. All spending cuts will be designed to lower America’s debt-to-GDP ratio to this level.
3. Oversight on such cuts would be provided by the Congressional Budget Office or perhaps the Office of Management and Budget. While details are still being worked out the White House has suggested that tax increases should be used if needed.
4. Slashing mandatory spending outside of “The Big Three” (Medicare, Medicaid, and Social Security). Such cuts will likely target farm subsidies, housing subsidies, federal student loans, and welfare programs.
But, like anything in Washington, everything is easier said than done. Republicans must placate their conservative base while Democrats will be forced to pacify liberals who are fearful of cutting social programs. In order to find such a compromise the White House has sent its top envoy, Vice President Biden, to establish a new bipartisan workgroup that hopes to reach a consensus on the budget issue. While the Senate’s own taskforce, known as the Gang of Six, seems to be falling apart let’s hope that this new group will be able to settle its differences.
The stakes have never been higher this year for lawmakers to work together and enact solid changes that will help lower our debt. It is decision time for the deficit and all of Washington is closely watching.
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