The partisan showdown in Washington last week threatened funding for a wide array of domestic programs, led by healthcare. Even if it is resolved in time to avoid a shutdown of the federal government, it is a bad portent for the healthcare reform debate. The disappearing Republican moderate bloc in both houses of Congress leaves almost nobody willing to compromise, making every major debate a zero-sum game.
President Bush, whose policies turned surpluses into trillions of dollars of national debt, now tries to appear as if he is a fiscal conservative, and doesnt care if funds for Medicare physician payments, the State Childrens Health Insurance Program, the National Institutes of Health and a wide array of other domestic programs are slashed. Meantime, he will not budge on his budget-busting projects, including the Iraq war and tax cuts for the wealthy.
While backing the president to the hilt on this newfound zeal for protecting our national treasury, Republicans in Congress also want to fix the alternative minimum tax, or AMT, which threatens 20 million middle-class Americans this coming spring with a levy originally designed to snare tax-dodging millionaires, but dont want to offset it with new revenue. The AMT should have been abolished decades ago but cynical politicians of both parties have wanted to count the revenue from the tax in order to appear to be less spendthrift than they are.
Minus the revenue from the AMT, the deficit grows by $50 billion this year and a total of more than $500 billion through 2012, the year the Bush administration claims its policies will balance the budget. This is one reason so little funds are available to expand healthcare programs.
Similar budget gimmicks imperil funding to cover the costs of a physician payment fix. Previous one-year patches to the physician payment system, which put off the pain of paying for them into future years, have now come home to roost. Doctors now face a 10% payment cut starting less than a month from now. Democrats want to pay the enormous cost by cutting $50 billion in payments to Medicare Advantage plans, but Bush issued another of his veto threats over just that one provision.
As of this writing, a resolution to simply continue current spending was likely to be passed, and the budget debate will drag on later into the holiday season. Democrats, who wanted to spend an additional $22 billion on domestic projects, now say they would adhere to the presidents demand for spending $933 billion for domestic and military programs, but will allocate the funds based on their priorities, not the presidents. News reports say the president and his minions relish the idea of vetoing such a bill, forcing a government shutdown. They are hoping for the same magic that allowed Bill Clinton to resurrect his presidency in 1995, as voters watched in dismay as Republicans pushed a similar shutdown.
In another casualty of the current standoff, Bush last week vetoed for the second time an expansion of SCHIP that had won broad support from both parties in Congress. If Republicans are able to come up with enough votes to sustain the veto, leaders of both parties say they hope to pass a one-year extension with enough money to cover the current 6.6 million enrollees, at a cost of $800 million in new money.
The SCHIP bills Bush vetoed (whatever you think about their merits) would have increased spending $35 billion over five years, covering another 4 million children. Consider that that is less than 3% of the cost of the Bush-era tax cuts over the same period, or that one month of the Iraq war costs $9.6 billion, almost twice what we now spend per year on SCHIP.
Its a good thing we have our priorities straight.