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Tough Republican budget likely to go back on shelf

House Budget Committee Chairman Rep. Paul Ryan, R-Wis., holds up a copy of his budget plan entitled 'The Path to Prosperity,' Tuesday, March 20, 2012, during a news conference on Capitol Hill in Washington. House Budget Committee Chairman Rep. Paul Ryan, R-Wis., holds up a copy of his budget plan entitled "The Path to Prosperity," Tuesday, March 20, 2012, during a news conference on Capitol Hill in Washington. (AP Photo/Jacquelyn Martin)
By Andrew Taylor
Associated Press / March 27, 2012
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WASHINGTON—Conservatives claimed credit Tuesday for forcing House GOP leaders to draft a tougher budget plan than initially planned, even as they pressed an alternative proposal that claims to balance the budget in just five years.

The competing budget plans are headed for a House vote Thursday, with conservatives pressing for larger cuts to Medicaid and the agency budgets passed by Congress each year.

The leadership-backed plan by Budget Committee Chairman Paul Ryan, R-Wis., is a favorite to prevail over the even more stringent plan unveiled by a group of the Republican Study Committee, which represents the conservative wing of the party.

Most conservatives are expected to ultimately rally behind the Ryan budget. And they say it's a lot tougher than the plan Ryan initially proposed.

"Because of the actions of the ... RSC, the budget you're going to see offered by the larger Republican conference later this week is a really, really good budget, a much more conservative budget than we started off with at the beginning of the year," said Rep. Mick Mulvaney, R-S.C.

Still, the most powerful prescriptions of the House GOP budget plan, like a dramatic restructuring of Medicare and big cuts to domestic programs such as Medicaid, food stamps and transportation appear destined to go back on the shelf almost as soon as the measure is passed this week.

Instead, lawmakers will advance more pedestrian, politically safe goals: passing a routine round of annual spending bills as well as a special budget bill that would block automatic spending cuts to the Pentagon and domestic agencies from taking effect in January.

To protect the Pentagon and domestic priorities like education from $78 billion in cuts next year alone, House Republicans would substitute a larger, $261 billion set of spending cuts -- but ones that would take effect more slowly over the coming decade.

The result? A higher deficit in the coming budget year than if Congress simply put the government on autopilot and went home.

Such is the reality under the arcane way Congress writes the federal budget. First comes a measure called a budget resolution, and that's the measure being voted on by the House this week. It's a nonbinding, hypothetical, invariably vague measure that sets out a broad vision on taxes, spending and deficits but often contains unrealistic assumptions about the kinds of spending cuts lawmakers can really stomach -- whether Democrats or Republicans are writing it.

The House GOP budget that's headed for the floor this week is indeed loaded with bold, tough -- critics say draconian -- steps that if enacted into law would swiftly wrestle the budget deficit under control.

The follow-up legislation, however, is less ambitious. It's a round of annual agency budget bills and a special measure known as a budget reconciliation bill. A reconciliation measure is constructed by telling congressional committees to scrub the programs under their jurisdiction to find savings, which are then bundled together and passed on the floor.

This year, House GOP leaders are orchestrating such a measure, in hopes of both forestalling the automatic cuts and in placating tea party lawmakers unhappy that the party, while talking a good game on the deficit, isn't getting much in concrete results.

"Let's say, `Hey, we're Republicans. We don't just talk about it,'" said Rep. Tim Huelskamp, R-Kan. "Actually pass something through the floor."

What is likely to make it into actual implementing bill later this spring, however, pales when compared with the sharp cuts called for in this week's nonbinding version.

The plan by Budget Committee Chairman Paul Ryan, R-Wis., getting a vote this week calls for cutting President Barack Obama's latest budget proposal by $5.3 trillion over the coming decade, with $187 billion of those cuts coming next year. Many of those cuts, however, can't pass when it actually comes to implementing them -- especially in an election year.

Instead, the follow-up House budget measure -- the Senate has no plans for a companion bill -- would reduce deficits by just $261 billion over the coming decade, and by only $18 billion next year. Instead of sharp cuts to Medicaid, transportation and welfare, for example, the cuts will probably occur in federal employee pensions, farm subsidies, food stamps and other health care programs.

Even those cuts are likely to test Republicans, many of whom were not in Congress the last time it passed a deficit-cutting budget reconciliation bill in 2005. That measure was approved by a GOP-controlled Congress and signed into law by President George W. Bush, but getting it passed was enormously difficult for Republicans. It cut $100 billion over a decade.

The 2005 debate, for example, featured numerous power plays by lawmakers protecting parochial interests, including a dramatic, last-minute push by Ohio Republicans to reverse Medicaid cuts that would have hit Buckeye State manufacturers of oxygen equipment.

Meanwhile, there's no sign that another key element in the GOP budget will advance this year. It's a tax plan promising sharply lower rates in exchange for eliminating many popular tax breaks. The GOP tax reform plan would lower the top rate from 35 percent to 25 percent, but at the risk of eliminating deductions on mortgage interest, charitable contributions and state and local taxes. It's simply too controversial and difficult to do in a hyper-polarized election year.

Separately, House Republicans also promise to cut about 5 percent from domestic agencies whose operating budgets will be written by the appropriations committees later this year. But the move breaks faith with last summer's hard-fought budget pact and is likely to be reversed in any final deal next fall or winter.

The upcoming real-world budgeting follows moves last month to extend payroll tax cuts and jobless benefits and prevent a cut in Medicare payments to doctors -- adding $101 billion to the budget deficit for this year and $40 billion for the upcoming 2013 fiscal year.

That bill was partially paid for by about $50 billion in new revenues and spending cuts that accrue slowly over the coming decade.

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