Tax bill could fuel push for Medicare, Social Security cuts

Tax bill could fuel push for Medicare, Social Security cuts
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The tax bill that Republicans are muscling through Congress could result in cuts to entitlement spending if it significantly increases the national debt, budget experts say.

Republicans say the tax-cut package will lead to economic growth and greater tax revenues, but there are doubts even within their party about whether that growth will come to pass. 

The Joint Committee on Taxation, Congress’s official budget scorekeeper, estimated the bill would cost $1 trillion over a decade even with economic growth taken into account. Sen. Bob CorkerRobert (Bob) Phillips CorkerMcConnell, Romney vie for influence over Trump's trial RNC says ex-Trump ambassador nominee's efforts 'to link future contributions to an official action' were 'inappropriate' Lindsey Graham basks in the impeachment spotlight MORE (R-Tenn.) opposed the bill for that reason.

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As the population ages and health-care costs continue to rise, the fiscal demands on entitlements like Medicare, Medicaid and Social Security are projected to grow. The projected increase in the debt from the tax package could make the situation worse, budget experts say. 

“In the past when members of Congress have been concerned about the debt, they’ve turned to these programs, so it’s not a stretch to see that they turn there in the foreseeable future,” said Tricia Neuman, a senior vice president at the Kaiser Family Foundation.

“If we are talking about the kinds of deficits” that are projected from the tax bill, “entitlement cuts are definitely on the table,” said William Hoagland, a senior vice president at the Bipartisan Policy Center.

Democrats and activist groups are seizing on the potential threat to entitlement programs to try and stop the bill and rally their base for the 2018 elections. 

They have run television ads warning the bill would result in a $25 billion cut to Medicare, and Senate Minority Leader Charles SchumerCharles (Chuck) Ellis SchumerTrump passes Pence a dangerous buck Democratic mega-donor reaching out to Pelosi, Schumer in bid to stop Sanders: report Trump administration freezes funding for study of hurricane barriers: report MORE (D-N.Y.) has repeatedly said the bill will “gut” the program. 

During an exchange on the Senate floor Thursday evening, Sen. Bernie SandersBernie SandersDNC warns campaigns about cybersecurity after attempted scam Overnight Health Care — Presented by American Health Care Association — Trump taps Pence to lead coronavirus response | Trump accuses Pelosi of trying to create panic | CDC confirms case of 'unknown' origin | Schumer wants .5 billion in emergency funds Biden looks to shore up lead in S.C. MORE (I-Vt.) asked Sens. Marco RubioMarco Antonio RubioOvernight Energy: Critics pile on Trump plan to roll back major environmental law | Pick for Interior No. 2 official confirmed | JPMorgan Chase to stop loans for fossil fuel drilling in the Arctic MacGregor confirmed as Interior deputy chief GOP casts Sanders as 2020 boogeyman MORE (R-Fla.) and Pat ToomeyPatrick (Pat) Joseph ToomeyNSA improperly collected US phone records in October, new documents show Overnight Defense: Pick for South Korean envoy splits with Trump on nuclear threat | McCain blasts move to suspend Korean military exercises | White House defends Trump salute of North Korean general WH backpedals on Trump's 'due process' remark on guns MORE (R-Pa.) to promise that Republicans wouldn’t cut Medicare and Social Security after passing the tax bill.

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“Will you guarantee the American people there will be zero cuts to benefits in Social Security, Medicare and Medicaid?” Sanders said.  

Toomey said there were no plans to cut the programs, but activists are skeptical.

“This is a tax bill that’s coming after Medicare and Medicaid cuts,” said Eliot Fishman, senior director of health policy at Families USA. “It’s fundamentally step one of a two-step process. Nobody should be under any illusions otherwise.”

Senate Republicans on Friday scrambled to piece together their legislation ahead of a final vote. The bill passed despite the $1 trillion price tag. 

Corker wanted to add $350 billion in automatic tax increases to reduce the bill’s impact on the debt, but other Republicans balked. He originally called for a tax-increase trigger, but that provision ran into issues with the Senate parliamentarian and couldn’t be included in the bill.

On Friday, Corker announced his opposition to the legislation.

“I wanted to get to yes. But at the end of the day, I am not able to cast aside my fiscal concerns and vote for legislation that I believe, based on the information I currently have, could deepen the debt burden on future generations,” Corker said in a statement.

Corker’s worries about increasing deficits were not echoed by other rank-and-file Republicans or members of leadership. They said the bill would grow the economy, reducing the debt in the process. 

“This will be a revenue enhancer. This will not be revenue decrease overall, or else we wouldn’t be doing it,” Sen. Mike RoundsMarion (Mike) Michael RoundsOvernight Defense: Pentagon policy chief resigns at Trump's request | Trump wishes official 'well in his future endeavors' | Armed Services chair warns against Africa drawdown after trip GOP chairman after Africa trip: US military drawdown would have 'real and lasting negative consequences' Trump pick for Fed seat takes bipartisan fire MORE (R-S.D.) said.

“We are presupposing it is going to cause a deficit and I am not sure that is a correct presupposition,” added Sen. Bill CassidyWilliam (Bill) Morgan CassidyThe Hill's Morning Report — AG Barr, GOP senators try to rein Trump in Overnight Health Care: Nevada union won't endorse before caucuses after 'Medicare for All' scrap | McConnell tees up votes on two abortion bills | CDC confirms 15th US coronavirus case Overnight Defense: Senate votes to rein in Trump war powers on Iran | Pentagon shifting .8B to border wall | US, Taliban negotiate seven-day 'reduction in violence' MORE (R-La.). 

Republicans are also facing the possibility that the $1 trillion tax bill will trigger deep, automatic cuts to Medicare next year unless Congress stops it from happening. 

Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellOvernight Health Care — Presented by American Health Care Association — Trump taps Pence to lead coronavirus response | Trump accuses Pelosi of trying to create panic | CDC confirms case of 'unknown' origin | Schumer wants .5 billion in emergency funds Push for national popular vote movement gets boost from conservatives To avoid November catastrophe, Democrats have to KO Sanders MORE (R-Ky.) promised Sen. Susan CollinsSusan Margaret CollinsThe Hill's Morning Report - Sanders takes incoming during intense SC debate Overnight Health Care — Presented by American Health Care Association — Lawmakers raise alarms over Trump coronavirus response | Top official warns virus appears inevitable in US | Democrats block two Senate abortion bills Democrats block two Senate abortion bills MORE (R-Maine) that the cuts required by the "pay-as-you-go" or "pay-go" budgetary rule won’t happen.

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Collins was a key holdout, and she said the personal promise from McConnell helped win her support for the legislation.

McConnell on Friday issued a joint statement with Speaker Paul RyanPaul Davis RyanPaul Ryan says he disagrees with Romney's impeachment vote Trump doubles down on Neil Cavuto attacks: 'Will he get the same treatment as' Shep Smith? Trump lashes out at Fox News coverage: 'I won every one of my debates' MORE (R-Wis.) saying the pay-go cuts won’t happen.

“Congress has readily available methods to waive this law, which has never been enforced since its enactment. There is no reason to believe that Congress would not act again to prevent a sequester, and we will work to ensure these spending cuts are prevented,” McConnell and Ryan said.

Lawmakers have voted numerous times in the past to waive the rule, but they need the support of Democrats, who have so far been reluctant to offer it.