- The Washington Times - Friday, January 26, 2007

ASSOCIATED PRESS

President Bush’s new budget will contain various proposals aimed at trimming projected increases in Medicare, the giant health care program for the elderly, according to Treasury Secretary Henry M. Paulson Jr.

“When the budget goes up, you will see a number of changes relating to Medicare which are aimed at slowing the growth of these liabilities, slowing the trajectory,” Mr. Paulson said.

It would mark the Bush administration’s latest effort to slow the soaring costs of health care and other entitlement programs.

Mr. Paulson’s comments came in a partial transcript released by Treasury of an interview he had with the Wall Street Journal.

The newspaper in a story yesterday said that Mr. Paulson refused to discuss the details of the reductions the administration will seek to lower the growth in Medicare spending.

However, it quoted unnamed sources as saying the savings were expected to total $90 billion over five years. These sources said the savings would come mainly from trimming projected increases for health care providers, although some Medicare beneficiaries would be affected directly.

The proposal is certain to spark an intense battle in Congress, which has fought past administration proposals to trim the growth of both Medicare and Medicaid, the giant federal-state program that provides health care for the poor.

Efforts to hold down costs in government entitlement programs are seen as a critical element of Mr. Bush’s plan to achieve a balanced budget by 2012 while preserving his first-term tax cuts, which are due to expire in 2010.

In the interview, Mr. Paulson said he was still talking with members of Congress to see if the administration’s stalled overhaul of Social Security can be revived.

“There are very different views on private accounts, personal accounts and taxes, but the key thing is to come together without preconditions,” Mr. Paulson said in the interview. “People recognize that there is a problem. And they recognize that it’s only fair that if you’re going to have a bipartisan discussion, you can’t tell someone we’re not going to let you talk about your idea.”

But Mr. Paulson conceded that he did not know whether he will succeed in getting the Social Security effort revived. He said the best he may be able to achieve is laying the groundwork for a future administration to address the problem.

“If I do my job right, if others do the things they’re doing, we’ll make progress, we’ll depoliticize this and it will be easier for someone, sometime in the future, to solve,” he said.

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