The House on Friday passed a Republican budget blueprint for the 2012 fiscal year that aims to reduce government spending by $5.8 trillion during the next decade through a series of program cuts, entitlement reforms, tax-code overhauls and a repeal of the 2010 health care law.
Republican leaders hailed their “Pathway to Prosperity” proposal as a bold step toward reining in runaway government spending while holding down taxes. Democrats countered the plan would slash benefits for seniors, the middle class and the poor while giving the wealthy and corporations tax breaks.
“The American people understand that we can’t continue to spend money that we don’t have,” said House Speaker John A. Boehner, Ohio Republican. “We have a moral obligation to speak the truth and to do something about it.”
The budget plan passed 235 to 193. No Democrats supported the measure, while only four Republicans voted against it.
The proposal now moves to the Democratic-controlled Senate, where it’s expected to die. But the nonbinding budget blueprint will serve as a starting point when debate on the federal government’s 2012 spending bills heats up in the coming weeks and months. The new fiscal year begins Oct. 1.
The plan, proposed by House Budget Committee Chairman Paul D. Ryan, Wisconsin Republican, would far exceed President Obama’s aim to cut the deficit by more than $1 trillion during the next decade.
Despite Mr. Ryan’s proposed spending cuts, his plan wouldn’t show a budget surplus for about two decades. But he said the country faces another economic crisis unless spending is significantly curbed immediately.
“Will we be remembered as the Congress that did nothing as the nation speeds toward a preventable debt crisis and irreversible decline?” Mr. Ryan said. “Or will it instead be remembered as a Congress that did the hard work of preventing that crisis, the one that chose this path to prosperity?”
The Ryan plan aims to eliminate or curtail hundreds of federal programs Republicans considers duplicative, bring non-security discretionary spending to below 2008 levels and would hold to a previous GOP pledge to ban earmarks.
The plan would lower government spending to less than 20 percent of the economy — in contrast to an estimated 25 percent of the economy this year. And it promises to reach “primary balance” — when yearly revenues match annual expenses, save for debt payments — by 2015.
Democrats say the plan shows that Republican priorities are more aligned with the wealthy and big business, not the middle and lower classes.
“The budget is supposed to be a statement of our national values — what is important to us as a country, what our priorities are, where we should allocate our resources and make our decisions,” said House Minority Leader Nancy Pelosi, California Democrat. “The Republicans are making some bad decisions.”
Democrats are particularly critical of a provisions in the House GOP plan that would convert the government’s Medicare health plan for seniors into a system in which the government would provide payments for private health insurance plans.
“Make no mistake, the Republican plan abolishes Medicare,” said Rep. Jan Schakowsky, Illinois Democrat. “It throws seniors into those not-so-loving arms of the private insurance companies, where they were before Medicare was adopted.”
Under Mr. Ryan’s proposal, the government no longer would cover seniors’ health care expenses as Medicare has since the 1960s, shifting more of the rising medical costs from the government to the program’s recipients.
Starting in 2022, Medicare would convert to a voucher-style system in which the government would provide payments for private health insurance plans. Seniors covered by Medicare at the time would be allowed to stay.
The payment scheme would be adjusted so that wealthier beneficiaries would receive a lower subsidy, the sick would receive a higher payment if their conditions worsened and lower-income seniors would receive additional assistance to cover out-of-pocket costs.