by Mike Hall, Apr 28, 2011
Congress is back in town next week and the budget battle will take top billing. Republicans are standing solidly behind their Paul Ryan-crafted House plan that forces seniors to pay more for health care by replacing Medicare with underfunded vouchers, cuts taxes for corporations and the wealthy, cuts Medicaid funding, repeals health care reform and slashes up to 2 million jobs.
They claim their fiscal plan is the centerpiece of the deficit-reduction strategy, but with $4.3 trillion in spending cuts and $4.2 trillion in tax giveaways, mostly to the wealthy and corporations, that’s not much of down payment on the deficit.
Today the Economic Policy Institute (EPI) released a Snapshot of the 10-year deficit-reduction projections for the Republican plan, the budget framework outlined by President Obama and the “People’s Budget” developed by the Congressional Progressive Caucus. While the Republican and Obama plans do achieve a reduction in the deficit over the next decade, the People’s Budget goes a step further by creating a budget surplus by 2021.
EPI says the Ryan plan’s savings come mostly from domestic spending cuts, cuts in Medicaid and Medicare. Obama’s framework cuts the deficit through some domestic spending cuts and slight reductions in defense spending, and saves money through health care reform and broad-based tax reform.
In contrast, the People’s Budget achieves deficit reduction mainly by shifting the tax burden more fairly to high-income individuals and corporations: Its proposals include rolling back the Bush tax cuts, taxing capital gains as ordinary income, raising the payroll tax cap and enacting a financial transactions tax. The plan also cuts defense spending, enacts a public option for health care coverage and makes room for $1.4 trillion in vital investments in infrastructure, education and innovation over the next decade.
Click here for the full Snapshot and here for the AFL-CIO Principles for the FY 2012 Budget.
