Show L New bill jeopardizes both student loans and medicare Jonathon The Washington Post drafting proposals that would N Lawmakers of or are f dollars from the growth of cut billions student loans just as students stu- stu slice into food Medicaid college pare back food stamps dents return to in the midst of a and trim farm price supports drought inthe in inThe inthe Midwestern out of 16 committees bills bius ou due The raft of by Sept 16 wm will present es Senate the House and Ser its toughest toughest test of fiscal Pa PartY the Republican decade For years the party nearly a austerity in of f small government rhetoric has while embraced overseeing the legislation that hose has helped I boost federal spending by more than a third since the GOP took control of Congress 10 years ago Now Republican lawmakers will be faced with the tough votes needed to slow that growth and enact the first cuts in entitlement spending since 1997 The impact of the bills will be broad The energy committees will produce legislation legislation legislation legis legis- lation to open Alaska's Arctic National Wildlife Refuge to oil drilling to secure 24 billion in royalties and other payments The Senate Finance Committee is trying to find as much as 10 billion in savings from New Bill Conton Page 7 S J s New Bill Cont from front Tennessee and Missouri are throwing tens of thousands thousands thousands thou thou- sands of people off their Medicaid ro rosters The The Senate agriculture committee will try to trim farm fann price supports by 24 bi billion lion through 2010 while cutting an additional million from food stamps Senate aides are crafting crafting crafting craft craft- ing legislation to cut 7 billion billion billion bil bil- bil- bil lion from the federal student student student stu stu- stu- stu dent loan program The The House and Senate education and labor committees committees committees com com- are expected to draft legislation to raise the premiums corporations pay to the troubled Pension Benefit Guaranty Corp from 16 to 31 per worker work work- er a move that would improve the governments government's balance sheet by 65 bil bil- bil- bil lion The bills are mandated by a budget resolution that passed this spring after acrimonious debate The budget blueprint mandated 35 billion in entitlement savings over five years along with 70 billion in tax cuts over that period By parliamentary rules the resolution ensures that both the spending and tax cut packages cannot be filibustered filibustered filibustered and thus can pass the Senate with a simple majority of 51 votes Such rules were established established established by the Congressional Budget Act of 1974 specifically to facilitate te passage of tough reduction deficit-reduction measures measures- But since the GOP took control of Congress and the White House the rules have been used instead to ease passage of President Bushs Bush's major tax cuts This year amid pledges of fiscal discipline Republican lawmakers lawmakers lawmakers law law- makers vowed to restore the budget acts act's original intent Now they have just weeks to turn the abstract pledges of the 2006 budget resolution into detailed legislation Its been off the radar screen but I can assure you it will be front and center very soon said Jim Manley spokesman for Senate Minority Leader Harry M. M Reid D Congressional aides cautioned that no legislation legislation legislation legisla legisla- tion will take final form until lawmakers return But a series of meetings through July helped aides begin to shape the bills that must be passed in the coming weeks Medicaid will be the largest target Even with the cuts the program would grow from billion this year to billion as Medicaid rosters rosters rosters ros ros- ros- ros swell with population growth and the working poor are dropped from provided employer-provided health plans The budget resolution resolution resolution tion mandated that the Senate Finance Committee produce legislation legislation legislation legis legis- lation that would carve 10 billion out of entitlement entitlement entitlement entitle entitle- under its ment programs jurisdiction Finance Committee Chairman Charles E. E E Grassley R-Iowa R ha had d hoped to find all 10 billion billion billion bil bil- bil- bil lion from Medicaid but bu t committee and Senate leadership aides say divisions divisions divisions divi divi- in the panel may force him to lower that Medicaid target Instead some savings will have to come from Medicare and welfare programs Record high gasoline prices should ease case passage of legislation to open Alaska's Arctic wilderness to oil drilling a move that environmentalists have thwarted for decades Timings everything in inthis inthis inthis this town said a senior Senate GOP aide who spoke on the condition of anonymity because the proposals have not been finalized But timing will make other proposals far more difficult aides conceded Cuts in farm price supports would come as farmers in Illinois Missouri and parts of Iowa cope with drought Senate aides say they can find 7 billion in savings from federal student loans by squeezing the banks that act as middlemen But with students just returning to school the timing of the proposal will feed into Democratic attacks For the student this shouldn't feel like anything anything anything any any- thing the senior Senate aide said But he conceded ed This ones one's going to cause some consternation The increase in iii premium 1 p payments payments' to the Pension I Benefit Guaranty Corp is I strongly opposed by business business business busi busi- busic c ness interests that maintain the move could prompt 1 companies to drop traditional traditional traditional 1 pension plans rather than face the added cost Democrats intend tomake to tomake b make the Republicans squirm especially since the sixth tax cut in five years will be moving simultaneously These spending cuts are deeply misguided andare and andare andare are only needed to make a partial down payment on the deep tax cuts coming said Thomas S. S Kahn Democratic staff director of the House Budget Committee The cost of the tax cut measure must total 70 billion bil bil- lion But Grassley hopes to craft legislation that would cut taxes by 90 billion over five years while closing closing closing clos clos- ing enough tax loopholes to bring the net cost down downto to the 70 billion price tag that can pass the Senate without a filibuster Under Grassley's proposal propos propos- al the deep cuts in the tax rates on dividends and capital capital capital cap cap- ital gains approved in 2003 would be extended through 20 2010 I 0 from their expiration date of 2008 A tax deduction for college tuition which is set to expire this year would also be extended through 20 2010 I 0 as would a tax incentive for low-income low savers The package would also include a year one measure to slow the reach of the alternative minimum tax a parallel income tax designed to ensure the affluent pay taxes but which is increasingly affecting the middle class A senior GOP tax aide said 20 billion in tax loophole loophole loop loop- hole bole closures should blunt Democratic charges that y I Republicans Republicans are cutting utti g programs programs for the poor to pay for capital gains and dividend cuts for the rich But Democrats say that will be precisely the point they will try to drive home The Democrats will make very clear that theres there's really really realy real real- ly y only one bill here Kahn said |