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Economy

Half Of The Spending Cuts In Blunt’s Jobs Plan Aren’t Actually Spending Cuts

Last week, I pointed out that the “jobs plan” proposed by Rep. Roy Blunt (R-MO), who is running for his state’s open Senate seat, includes a provision permanently guaranteeing taxpayer giveaways to the real estate industry, which calls into question Blunt’s commitment to deficit reduction. But that’s not the only part of his plan that proves Blunt is fundamentally disinterested in addressing government spending.

Blunt included in the plan what he has claimed is $2 trillion in spending cuts, which would presumably be used to either reduce the deficit or to fund some of the massive tax cuts that he’s embraced. “In this plan, Roy identified over two trillion dollars in cuts right off the bat that can be taken out of government,” said former Missouri treasurer Sarah Steelman, who has endorsed Blunt’s campaign.

But in what he charitably calls an “accounting error,” the Kansas City Star’s Dave Helling notes that fully one half of Blunt’s spending cuts aren’t actually spending cuts at all:

A look at that plan shows half of those savings — $1 trillion — would come from Blunt’s proposal to repeal the health care reform package…Repealing health care reform would eliminate $1 trillion in spending, but it would also eliminate the $1 trillion in tax and fee increases and Medicare reductions that are in the law as well. The net effect of health care repeal on the federal deficit is, roughly, zero.

Actually, contrary to Helling’s assertion, repealing the Affordable Care Act wouldn’t have zero effect on the deficit: it would actively increase it. According to the Congressional Budget Office, repealing the bill would increase the deficit by $143 billion over the next ten years.

But the point remains that the only way Blunt’s push for repeal works as a deficit reduction measure is if he plans to keep all of the tax increases and Medicare savings, without actually giving anyone any additional health care.

Plenty of other spending cuts that Blunt suggests are equally ill-informed. He proposes repealing the remaining stimulus funds, including those dedicated to middle class tax cuts. He also says he’d cut an unidentified “wasteful welfare program,” which is presumably the Temporary Assistance for Needy Families Emergency Fund that House Republicans like to cite all the time. But it’s actually a successful work program that is supporting hundreds of thousands of jobs across the country, including 4,600 in Blunt’s own state.

Of course, Blunt is far from the only one who thinks that repealing the Affordable Care Act is a legitimate deficit reduction strategy. For instance, New Hampshire’s Republican Senate candidate, Kelly Ayotte, has made it the centerpiece of her deficit reduction plan.

Former Gov. Pataki Absurdly Claims That Heath Care Reform Is ‘One Of The Reasons We Have This Deficit’

Republicans have been trying very hard to blame President Obama for the nation’s deficit (which he largely inherited from his predecessor), but former Gov. George Pataki (R-NY) today may have gone to the most absurd lengths yet. On MSNBC, Pataki said that the health care reform bill that became law this year is “one of the reasons we have this deficit”:

You just said that Boehner indicated Obamacare as one of the reasons we have this deficit, one of the reasons we have failed to create private sector jobs and he’s absolutely right.

Watch it:

Pataki made no attempt to explain how a law that was passed this year and has yet to be implemented could have possibly caused this year’s deficit. Here’s a handy chart from the Center on Budget and Policy Priorities explaining where the deficit actually comes from:

See health care on there anywhere? No. The deficit was caused by the economic downturn (and the drop in tax revenue that came along with it), the wars in Iraq and Afghanistan, and the Bush-era tax cuts that turned a record surplus into a deficit.

The Affordable Care Act not only adds nothing to the deficit this year, but is entirely deficit neutral. As Igor Volsky pointed out earlier, the Congressional Budget Office released a letter this week stating that the Affordable Care Act “will produce $143 billion in net budgetary savings over the 2010-2019 period.” Repealing the parts of the law that Republicans love to gripe about would cause an increase in deficits of $455 billion. Let’s repeat: repealing health care reform would increase, not decrease, the deficit.

Throughout the health care reform debate, Obama was very clear that he wasn’t interested in a bill that added to the deficit, and Democrats went to great lengths — having the CBO score and then re-score the legislation over and over — until they were certain that it had no deficit impact. In fact, it had to be deficit neutral to pass via reconciliation. Pataki’s claim is simply absurd and has no basis in reality (which hasn’t stopped other Republicans from making it as well).

Of course, Pataki seems to believe that Americans don’t actually deserve to hear policy details at all, at least from any Republicans. “Do the Republicans need to be more specific? Do the American people need to hear the ABC’s, how and then why [the Republican agenda] will work?” MSNBC’s Chris Jansing asked him. “No, I don’t think so,” Pataki replied.

Education

Daniels To Accept $434 Million In State Aid That He Requested But Then Opposed

In an interview this week, Gov. Mitch Daniels (R-IN) asserted that “only a blind zealot” would say that the American Recovery and Reinvestment Act (the stimulus) “has done any good.” “It hasn’t worked,” he said. “It’s trickle down government is the best way I can describe it.”

Daniels’ rhetoric hid the fact that he not only trumpets stimulus investments on his state’s website, but he also signed a letter in February asking that some stimulus provisions be extended. And now that an additional $26 billion in state aid has been approved by the Congress, Daniels has his hands open for $434 million, “even though he opposed the legislation”:

“Whether it’s wise from a national standpoint, whether it’s really doing anything about the private economy where we need the jobs, that’s an open question to say the least,” Daniels said…“But they’re going to send it so we’ll be very cautious with it. … The most likely event is that it helps us maintain our position in the black with a little more room to spare.”

“If they send a check, we’ll cash it,” said the governor’s press secretary, Jane Jankowski. So, for the record, Daniels requested the money in February, opposed it this month, but now plans to accept it, just like all the other governors who have grandstanded against stimulus funding before gladly taking it.

Daniels says that the additional funding — which will help save the jobs of 3,100 teachers — “helps us maintain our position in the black” without noting that he is only in the black because of the Recovery Act. In fact, the Indiana budget includes more than $1 billion in stimulus money.

However, Indianans should keep an eye on Daniels, as he used some Recovery Act funding meant for education to simply bolster his state’s Rainy Day Fund, instead of spending it on students and teachers. Gov. Rick Perry (R-TX) pulled the same trick, earning a slap on the wrist from Congress. The money is meant to prevent cuts in vital services and to preserve jobs, not to get tossed into the bank to boost the conservative budgeting credentials of a state’s governor.

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