House GOP Pushes Tight Budget Plan

The GOP plan, drafted by Budget Committee Chairman Paul Ryan, R-Wis., would use sharp cuts to domestic programs to shrink U.S. deficits to $3.1 trillion over the coming decade, less than half the size of those proposed by President Barack Obama last month.

But it does so in ways that would be unprecedented — and unrealistic — by relying on assumptions like cutting transportation outlays from $93 billion this year to just $50 billion in the 2013 budget year starting in October. Its cuts to the Medicaid health care program for the poor and disabled would total more than $800 billion over the coming decade, Van Hollen said.

The measure cuts even more deeply than last year's GOP blueprint in an apparent appeal to GOP tea partyers unhappy with the Republican Party's performance on the budget. It also seeks to win over voters frustrated with out-of-control deficits. Proposals like transferring the food stamp program to the states and allowing them to impose time limits on benefits or work requirements are red meat for conservatives, as is a tax proposal to lower the top individual and corporate tax rate to 25 percent, financed by rolling back a variety of tax breaks.

"For years, both political parties have made empty promises to the American people. Unfortunately, the president refuses to take responsibility for avoiding the debt-fueled crisis before us," Ryan said. "The American people deserve real solutions and honest leadership. That's what we're delivering."

The annual budget debate is conducted under arcane rules. The main budget document, called a budget resolution, is a nonbinding measure that sets the parameters for follow-up legislation on spending and taxes. Even though its broader goals usually are not put into place, it is viewed as a statement of party principles.

Ryan's plan is more of a campaign manifesto than a governing document. It is a dead letter in the Democratic-controlled Senate and is not even a starting point for a dialogue with Obama. For one thing, it breaks faith with last summer's hard-fought budget pact, seeking to impose new 5 percent cuts on domestic agencies whose operating budgets will be written by the Appropriations committees later this year.

"It would be difficult to overstate the radicalism of the domestic cuts proposed by the House budget," said acting White House budget director Jeff Zients. "Over a decade, the resolution would cut over $1 trillion in non-defense spending on top of the reductions the president has already signed into law."

The measure is, however, more generous to the Pentagon, calling for restoring more than half of the almost $500 billion cut from defense accounts over the coming decade by last year's budget pact. But it fails to address a $300 billion-plus hole in Medicare's budget under an archaic formula for physician reimbursements.

"Let me tell you something. I'm happy that you introduced this budget," said Rep. Bill Pascrell, D-N.J. "I'm happy to run against it — politically, economically, any way you say it — because you've handed it to us. It defines our battle."

Separately, House Republicans introduced a $46 billion, one-year tax cut for smaller businesses that GOP lawmakers said would spur job growth.

The measure would allow businesses with fewer than 500 employees — or 99.9 percent of the nation's companies — to deduct 20 percent of their income from their federal tax bill. The measure exempts no businesses from the tax cut, leaving the door open to certain Democratic criticism that it would provide breaks to everything from hedge funds to pornography businesses that qualify.