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WH analysis of GOP deficit plan: job losses, poorer kids


THE WHITE House says the math in House Speaker Kevin McCarthy’s plan announced on Wednesday to trim the federal deficit by $4 trillion over a decade is “unforgiving” — estimating a deep 22 per cent cut to non-defence spending that would leave children poorer, veterans sicker, families hungrier and housing more expensive.

“There is no escaping the pain to working families and our economic future,” White House Budget Director Shalanda Young concludes in a draft of an analysis obtained by The Associated Press yesterday.

President Joe Biden and GOP lawmakers are engaged in a tense showdown over federal finances, Republican House Speaker McCarthy insisting on spending cuts as a condition to raise the government’s legal borrowing authority, while Democrat Biden wants to keep budget talks separate from the critical debt limit action.

Budget Director Young’s analysis is an effort to explain the possible consequences, though McCarthy anticipated the criticism by telling a Wall Street audience on Monday: “Don’t believe anyone who says our plans hurt Americans’ social safety net. We are a very generous nation. And, when people fall on tough times, we’ll help them.”

Young argues in her analysis that McCarthy’s budget caps mask the full extent of the likely cuts, and that they would compound over time in ways that she said would harm millions of US households. The White House’s own budget proposal offers nearly $3 trillion in deficit savings, mainly through higher taxes on the wealthy and corporations.

“The legislation Congressional Republicans have drafted is designed to avoid levelling with the American people about how these cuts would impact their lives,” Young writes in the draft. “This bill is vague by design – but that doesn’t obscure the fact that it will force devastating cuts that will hurt millions of people, damage our economy and undermine our national security.”

By not spelling out specific cuts, Republicans are able to potentially minimise a backlash to their plan. McCarthy’s proposal would raise the debt ceiling by $1.5 trillion into March 2024, in exchange for a long list of Republican priorities.

In addition to the one per cent limit to future spending increases, the GOP plan would gut Biden’s signature climate change funds, cancel up to $20,000 per person in student loan forgiveness, and impose long-sought work requirements on recipients of government aid, among other provisions.

Given that Republicans have indicated that they will protect defence spending, Young estimates that domestic programmes would be cut by 22 per cent under the GOP plan. Social Security and Medicare – programmes expected to drive up the national debt long term – are shielded from any reductions.

At that reduced level of funding, there would be 30 million fewer veteran outpatient visits and 81,000 jobs lost across 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 teacher and classroom aide jobs. There would be 200,000 fewer children enrolled in Head Start and 180,000 who would lose access to child care.

Roughly 1.7 million women, infants, and children would lose vital nutrition assistance through the Special Supplemental Nutrition Program. More than a million seniors would lose access to food programmes such as Meals on Wheels.

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

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