House Budget Plan Backs Health Care Overhaul
April 29, 2009 - 3:27 PMActing with unusual speed, the House on Wednesday adopted a $3.4 trillion budget outline that endorses much of President Barack Obama's ambitious agenda while permitting the national debt to continue to spiral higher.
While a welcome victory for Democrats, the 233-193 House vote approving the House-Senate compromise budget is only a first, relatively easy step toward Obama's goal of providing health care coverage for all Americans. Next would come arduous negotiations among lawmakers, the Obama administration and a vast array of interest groups.
Not a single Republican voted for the measure; 17 Democrats, mostly from GOP-leaning districts, voted against it.
The Senate will vote on the measure Wednesday afternoon.
With the economy in recession and the bailout of the financial sector costing hundreds of billions of dollars, deficits would rocket to $1.7 trillion for the ongoing budget year, dipping to a still-astonishing $1.2 trillion in 2010. The national debt would rise from today's $11.2 trillion level to $17 trillion at the end of 2014.
"The same Democrats who were outraged over a $455 billion deficit last year came to us this year with a budget that would lead to trillion dollar deficits," said Senate GOP Leader Mitch McConnell of Kentucky.
The budget measure is a nonbinding outline for follow-up tax and spending legislation. It is Congress' response to Obama's $3.6 trillion budget plan released in late February.
Perhaps most significantly, the budget plan would give Democrats a stronger hand in advancing Obama's health care initiative this fall by allowing it to go forward without threat of GOP stalling tactics in the Senate. Democrats pledge to first try passing health care legislation with GOP support.
"The budget also allows us ... an up-or-down vote on reforming health care - not as an option of first resort, but as a fallback if partisanship blocks progress," said House Majority Leader Steny Hoyer, D-Md.
But the budget plan skirts difficult decisions on how to pay for Obama's health care plan, which is expected to cost more than $1 trillion over the next decade. It allows the new president's signature $400 tax credit for most workers to expire in 20 months - but devotes $512 billion over five years to extend tax cuts passed during President George W. Bush's first term for middle-class workers, investors and families with children.
And votes in the Senate made it clear that Obama's initiative to combat global warming by making it more expensive to emit greenhouse gases faces great obstacles.
Democrats say they and Obama inherited a record budget mess and deserve credit for cutting the deficit by two-thirds over the next five years. Most of those deficit savings, however, are expected to come automatically as the economy recovers, tax revenues rebound and the Iraq war winds down.
Republicans say Democrats rely on the usual bag of budget tricks: savings that won't appear, spending caps that won't hold, and tax cuts that aren't "paid for" as promised.
The Democratic plan assumes Congress will devote only $50 billion a year for operations in Iraq and Afghanistan for 2011 and beyond and pass an annual fix for the alternative minimum tax without adding to the deficit over 2013-14.
The Democratic plan embraces several of Obama's key goals besides a health care overhaul, including funds for domestic programs and clean energy, and a tax increase for individuals making more than $200,000 a year or couples making more than $250,000.
Rep. Paul Ryan, R-Wis., said that Wednesday's news that the economy had shrunk by 6.1 percent in the first quarter highlighted the likelihood that the deficit numbers are even worse than predicted in the budget.
"Put reality into the budget and the deficits and debt go much higher," Ryan said.
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