Home Employment WH Analysis of the GOP Deficit Plan: Job Loss, Poorer Kids

WH Analysis of the GOP Deficit Plan: Job Loss, Poorer Kids

WH Analysis of the GOP Deficit Plan: Job Loss, Poorer Kids

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The White House says the math in House Speaker Kevin McCarthy’s plan to cut the federal deficit is “ruthless” — a hefty 22% cut in non-defense spending, making children poorer, veterans sicker, families hungrier and housing more expensive.

“There is no escaping the pain for working families and our economic future,” White House budget director Shalanda Young concluded in a draft analysis obtained Thursday by The Associated Press.

President Joe Biden and GOP lawmakers are locked in a tense standoff over federal finances, Republican House Speaker McCarthy pushes for spending cuts as a condition to increasing the government’s statutory credit power, while Democrat Biden wants to keep budget talks separate from critical debt-cutting action .

McCarthy has criticized Biden for avoiding sit-down conversations. On Wednesday, the speaker unveiled a plan he said would reduce more than $4 trillion in deficits over the next 10 years, largely by freezing discretionary spending at 2022 levels and then increasing them at just 1% a year thereafter. In his State of the Union address in January, Biden indicated that he would engage in some form of talks — once the Republicans drafted a budget proposal.

GOP lawmakers are betting the public will support their vision of a smaller government, while the White House’s strategy is based on the resulting cuts being unpopular once the ramifications are understood.

Budget Director Young’s analysis is an attempt to explain those potential ramifications, though McCarthy anticipated the criticism by telling a Wall Street audience on Monday, “Don’t believe anyone who says our plans are hurting Americans’ social safety net. We are a very generous nation. And when people are in trouble, we help them.”

Young argues in her analysis that McCarthy’s budget caps mask the full magnitude of the likely cuts, and that they would increase over time in ways she said would harm millions of American households. The White House’s own budget proposal offers nearly $3 trillion in deficit savings, mostly from higher taxes on the wealthy and businesses.

“The legislation that Republicans in Congress have created is designed to prevent the American people from coming to terms with how these cuts will affect their lives,” Young writes in the draft. “This bill is vague in scope — but that doesn’t change the fact that it will force devastating cuts that will harm millions of people, damage our economy and undermine our national security.”

By not calling for specific cuts, Republicans hope to minimize backlash to their plan. McCarthy’s proposal would raise the debt ceiling by $1.5 trillion through March 2024 in exchange for a long list of Republican priorities.

In addition to the 1% cap on future spending increases, the GOP plan would, among other things, undercut Biden’s signature climate change funds, cancel up to $20,000 per person in student loan forgiveness, and impose long-sought job requirements on government aid recipients.

Since Republicans have indicated they will protect defense spending, Young estimates domestic programs would be cut by 22% under the GOP plan. Social Security and Medicare — programs that are expected to drive up the long-term national debt — are shielded from any cuts.

At that reduced funding level, there would be 30 million fewer veterans’ outpatient visits and 81,000 jobs lost in the Veterans Health Administration, according to the analysis.

The cuts would be borne by 25 million students in schools that teach poorer children, 7.5 million students with disabilities, and could lead to the loss of 108,000 jobs for teachers and classroom assistants. There would be 200,000 fewer children enrolled in Head Start and 180,000 children would no longer have access to childcare.

Approximately 1.7 million women, infants and children would lose essential nutritional assistance through the Special Supplemental Nutrition Program. More than a million seniors would lose access to food programs such as Meals on Wheels.

There would be 630,000 poorer families who would lose access to housing vouchers. And just months after a train derailment in Ohio’s Norfolk Southern sparked GOP criticism of the Biden administration, there would be 7,000 fewer rail safety inspections, according to the analysis.

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