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March 20th, 2012 
FAKE NEWS for the Zionist agenda WASHINGTON (Reuters) – House Republicans unveiled an ambitious budget plan on Tuesday to cut taxes, slash spending and overhaul Medicare in a bid to draw a stark election-year contrast between their vision of the size and role of government and that of President Barack Obama.
The budget proposes sweeping changes to the popular government-run Medicare healthcare program for the elderly, a politically risky gambit for Republicans who faced a voter backlash last year when they offered a similar plan.
It also seeks to cap discretionary federal spending on education, transportation and other government programs at $1.029 trillion, roughly $18 billion less than Democrats want. That sets up a battle over spending that, if unresolved, could lead to a government shutdown later this year.
While its proposals have little chance of becoming law due to opposition in the Democratic-controlled Senate, Republicans in the House of Representatives are looking for the plan from Congressman Paul Ryan to provide a lift to their re-election fortunes in November.
After a string of debacles ranging from last summer’s debt-limit standoff to a near-revolt over extending a payroll tax cut, Republicans want to get back to their core message of shrinking the size of government. They claim an advantage over Obama on spending, debt and taxation and intend to use Ryan’s budget plan to exploit it.
Where Obama wants to raise taxes on the wealthy and boost near-term spending on infrastructure and education, the Republicans want to cut taxes and spending on healthcare and social safety net programs – benefits used more by the poor and middle classes.
The Republican budget plan would produce deficits totaling $3.13 trillion in the next 10 years – less than half the $6.39 trillion in deficits the Congressional Budget Office says Obama’s fiscal 2013 budget plan would rack up.
The Republican plan claims to put U.S. debt on a downward path, to 62.3 percent of U.S. economic output by 2022, versus Obama’s 76.3 percent, which is slightly above current levels.
Ryan said in the document that U.S. debt growth, if left unchecked, would spark a debilitating European-style debt crisis.
“The growing possibility of such a crisis is creating debilitating uncertainty about the future, hurting job creation and economic growth today,” he wrote.
DISMANTLING HEALTHCARE REFORM
The Republican budget achieves much of its deficit-reduction goals through savings gained by dismantling Obama’s 2010 healthcare reform law and by turning social safety net programs like food stamps and the Medicaid program for the poor into block grants for states.
After proposing last year to convert Medicare into a voucher-like program to allow seniors to purchase private health insurance, Ryan has modified his reforms in a bid to blunt criticism that it would shift too many costs onto the elderly.
The new plan offers so-called premium support to allow beneficiaries to purchase either traditional Medicare or competing plans through a government-run exchange.
But political strategists say the party will still struggle to sell it to older voters who worry about their benefits. Democrats believe Ryan’s determination to push ahead with the Medicare revamp in an election year is a huge mistake that will prove politically toxic for Republicans in congressional races.
“This process risks creating an actual death spiral for the basic guarantee of Medicare as more people are forced out of the system and those who remain face higher and higher costs,” Obama economic adviser Gene Sperling said on MSNBC’s “Morning Joe” program.
House Democrats labeled it a “vicious plot to destroy our nation’s promise to our seniors.”
BRASH REFORMER, VP CANDIDATE?
But the political risk on Medicare has not daunted Ryan, the 42-year-old House Budget Committee chairman who fashions himself as a brash young reformer determined to shrink government.
Known for his slick YouTube videos to illustrate his dire predictions of the U.S. debt trajectory and for slipping in iPod earbuds sometimes when reporters are around, Ryan has kept the debt debate on the boil since Republicans took control of the House two years ago.
The budget plan gives Ryan, who is frequently mentioned as a potential vice presidential candidate, a huge platform to influence the party’s direction and set the agenda for the election-year spending debate.
But many conservative Republicans, including those backed by the Tea Party movement, wanted Ryan’s budget to contain even deeper cuts to discretionary spending now.
They were pushing to go below fiscal 2013 discretionary caps agreed with Democrats last August by as much as $116 billion, but the Ryan budget settles on a $18.4 billion reduction. Democrats warn that even the smaller cut breaks last year’s debt-limit agreement meant to keep fiscal peace and risks a government shutdown by causing conflict over spending bills.
Some conservative Republicans may balk at the lower level, making House passage less certain, but the plan does shield defense and security spending from automatic spending cuts that are scheduled to kick in next January.
The Ryan plan contains another element popular with Republicans across the board: tax reform. It proposes to cut top rates for individuals, paring back the number of tax brackets to two – 25 percent and 10 percent – from six now.
The current top rate is 35 percent, but it is set to rise to 39.6 percent at the beginning of next year if the tax cuts enacted during President George W. Bush’s presidency are allowed to expire.
It also would push through a corporate tax reform plan that would lower nominal tax rates to 25 percent from about 35 percent and largely eliminate taxes on U.S. companies’ overseas profits.
(Additional reporting by Donna Smith and Richard Cowan; Editing by Ross Colvin and Bill Trott)
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