December 13, 2005
Tuesday

WASHINGTON - The liberal alliance that hammered President Bush's Social Security plan has turned its sights on the Republican budget, running television commercials in the districts of seven Republican moderates and promising a pray-in at the Capitol on Wednesday.

The $500,000 ad buy, sponsored by the Emergency Campaign for America's Priorities and the American Federation of State, County and Municipal Employees union, accuses the Republicans of voting to "slash health care for struggling families, cut college loans for middle-class kids and take food off the tables of poor children" to "give billions in tax breaks to millionaires."

Jim Wallis, founder of Sojourners, a Christian group active in politics, said protesters will pray for "a change of heart" by Republicans, citing Old Testament prophet Isaiah, "Woe to you legislators of infamous laws ... who make widows their prey and rob the orphan."

The commercials complicate an already difficult task facing Republicans as they attempt to push through the first spending reductions in entitlement programs since 1997, while at the same time preserving Bush's first-term tax cuts on capital gains and dividends.

The budget has proved difficult for Republicans this year, and promises only to get worse in the future as federal entitlement spending rises rapidly, squeezing other programs and threatening all of Bush's first-term tax cuts.

The crux of the problem is that for the first time since taking control of both Congress and the White House, Republicans are facing serious pressure to restrain spending and lower the deficit.

But they are loath to cut middle-class entitlements such as Medicare or farm subsidies, or abandon any of Bush's earlier tax cuts, and so have turned to programs such as Medicaid, student loans and food stamps.

That strategy has opened them to broadsides by Democrats and their allied interest groups, and caused tremors among party moderates, fracturing party discipline.

Republicans have defended the budget cuts - $50 billion in the House's version of the budget reconciliation bill and $35 billion in the Senate version - as minor.

Medicaid is the nation's largest health care program, providing health care to the poor and disabled and paying half the nation's bill for nursing home care. States share its rapidly growing costs. House Republicans want to reduce the federal share over the next five years from $1.113 trillion to $1.10 trillion; that translates to reducing spending growth from 7.7 percent to 7.5 percent over the next 10 years.

The difficulty they are having passing these cuts points to much larger budget fights ahead.

The House and Senate have taken sharply different approaches. Leaders vow to reconcile their differences before Christmas, but a vote could slip to next year.

The House budget has drawn the most fire for its cuts of Medicaid, food stamps and student loans. The Senate version omits these and instead targets a Medicare fund intended to induce insurance companies to participate in the new prescription drug benefit for seniors. The White House has threatened a veto if that provision remains.

"Both versions are very unpopular because both share one fundamental flaw, which is these cuts are being driven in order to cover part of the cost of the large tax cuts they're pushing," said Thomas Kahn, Democratic staff director of the House Budget Committee. "Republicans can read the polls and they know that cutting programs like student loans and child support enforcement to pay for tax cuts for people at the top is just not popular."

One of the Emergency Campaign commercials targets Budget Committee chairman Jim Nussle, an Iowa Republican running for governor. Committee spokeswoman Kim Deti countered that the budget bill "is not making cuts in spending. Spending on all the programs is actually going to continue to increase. What we are simply doing through the bill is slowing growth in programs by a very slight amount."

The National Governors Association recommended many of the Medicaid changes in a report last summer prepared by a bipartisan task force led by Virginia Gov. Mark Warner, a Democrat who may run for his party's presidential nomination.

Many governors complain that Medicaid is overwhelming their budgets. The governors asked for limits on wealthy and middle-class seniors who commonly shelter their assets to qualify for Medicaid's nursing home payments.

The House bill would impose a $750,000 ceiling on home equity that seniors can shelter while still qualifying for nursing home benefits. Governors also want to be allowed to impose co-payments on beneficiaries and asked for more latitude in benefit structures.

Analysts say the overall budget cuts are not large, but the problem for Republicans is that they are linked with even larger tax cuts that together will produce larger rather than smaller deficits.

"In the larger context, these are not huge cuts," said Robert Bixby, executive director of the Concord Coalition, a budget watchdog group. "It's just the whole idea that a very narrow slice of the budget is on the table, so Republicans have gotten themselves into a corner here where it does look like they're balancing the budget on the backs of low-income people."

At the same time, Republicans have also added new spending - including renewing an expired milk subsidy and higher subsidies for home heating. One expensive Senate provision provides $3 billion to all U.S. households, regardless of income, to buy converter boxes for analog televisions as TVs are converted to digital later in the decade.

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