With the federal budget deficit exploding – it is projected to top $1 trillion in 10 years – Republicans in Congress are changing their tune regarding the huge tax cuts they gave corporations and wealthy Americans.
During last year’s highly contentious debate on Capitol Hill over the cuts pushed by Republican President Donald J. Trump and embraced by the GOP majorities in the House and Senate, proponents dismissed concerns about the loss of revenue. They proclaimed the reductions would pay for themselves.
Here’s what Senate Majority Leader Mitch McConnell, R-Ky., had to say:
“I not only don’t think it will increase the deficit, I think it will be beyond revenue neutral. In other words, I think it will produce more than enough to fill that gap.”
Fast forward to last month when Bloomberg News interviewed McConnell, who talked about the skyrocketing budget shortfalls.
Here’s how Bloomberg reported what the Senate majority leader had to say:
“[McConnell] blamed rising budget deficits and debt on a bipartisan unwillingness to contain spending on Medicare, Medicaid and Social Security, and said he sees little chance of a major deficit reduction deal while Republicans control Congress and the White House.
“It’s disappointing, but it’s not a Republican problem,” he told Bloomberg News. “It’s a bipartisan problem: unwillingness to address the real drivers of the debt by doing anything to adjust those programs to the demographics of America in the future.”
No, the failure of the tax cuts to generate enough revenue to pay for themselves wasn’t a problem created by Democrats. Indeed, they warned that corporations and wealthy Americans would not invest their windfalls in job-growth initiatives. It now turns out that many companies used their tax savings to claw back stock.
Although the economy is recovering and the nation’s unemployment rate is the lowest it has been in almost 50 years, the revenue projections from the tax cuts are not materializing.
That’s why Republicans are talking about the need to deal with the ballooning budget shortfall.
In the first fiscal year in the Trump presidency, the deficit grew by nearly $800 billion.
Last year, we urged the president and the GOP-controlled Congress to go slow on the tax cuts.
However, Trump was determined to keep a campaign promise, and the GOP leadership in Congress wanted to give him a sweeping victory.
We also warned that many Americans, especially seniors, would not sit idly by if Medicare and Social Security were placed on the chopping block.
While it is true that health and retirement benefits take up a large part of the budget, simply slashing benefits or increasing the retirement age won’t solve the problem.
We have called for a national discussion on the future of those programs, given the aging of the population and the shrinking of the workforce. As the number of retirees increases and the number of workers decreases, the strain on Social Security and other programs is predictable.
But before recipients are called upon to make up any shortfalls in revenue, here’s a reality check for members of Congress who retire with lucrative benefits: The average Social Security check is just $1,300 a month. For many Americans that’s their sole income.
This is how Vox, an American news and opinion website, portrayed the differences between Republicans and Democrats when it comes to entitlement programs:
“Governing is about priorities. Democrats have run on expanding Social Security benefits and extending Medicare coverage to every American. They’re proposing higher taxes on the wealthy and on corporations to pay for those plans. Republicans are going hard in the other direction: lower taxes for businesses, fewer benefits for vulnerable Americans.”
A balanced federal budget has been an article of faith for the Republican Party, but President Trump does not seem overly concerned about the projected $1 trillion-plus budget shortfall.
Indeed, the president appears to be at odds with GOP leaders in Congress with regard to Social Security and Medicare.
“We’re saving Social Security; the Democrats will destroy Social Security,” Trump said last month. “We’re saving Medicare; the Democrats want to destroy Medicare.”
In the end, senior citizens will decide which political party to trust,
The outcome of Tuesday’s election will speak volumes about the future of Social Security, Medicare and Medicaid.