House GOP looks ready to shrink US role in Medicare. Is Obama?

House Republicans' budget plan for fiscal year 2012, slated to be taken up by the full House later this week, aims to roll back nearly half a century of social policy, as well as cut trillions in federal spending. Though it has scant prospect of gaining Senate approval, the plan is nonetheless expected to define partisan fault lines through the 2012 election and beyond.

On Wednesday, President Obama will lay out a competing idea for how to go about cutting government spending and reducing the record federal deficit. He, too, is expected to address the social contract with Americans via entitlement programs, after mostly ignoring that issue in his 2012 budget proposal earlier this year.

Crafted by Rep. Paul Ryan (R) of Wisconsin, who is the Budget Committee chairman, the plan would cut $5.8 trillion over the next 10 years, targeting some of America's most popular government programs. He said on April 5 that it's time to end "empty promises to Americans from a government that is going broke."

The House GOP proposal would roll back Obama-era tax increases, defund the health-care reform law passed last year, transform Medicaid (for the poor) into block grants to the states, and replace the defined benefits of Medicare (for seniors) with subsidies for private insurance.

Democrats see the plan as a deliberate bid to dismantle the legislative legacy of the New Deal and Great Society, especially by downgrading the government safety net for the most vulnerable.

"The Republican budget is the same tired formula of extending tax breaks to the rich and powerful at the expense of the rest of America – except this time on steroids and dressed up with nice-sounding sweet talk of 'reform,' " said Rep. Chris Van Hollen (D) of Maryland, the top Democrat on the House Budget Committee, before the panel approved the measure on a party-line vote on April 6. "There is nothing courageous about targeting the most vulnerable in our society."

On the Senate floor Tuesday, majority leader Harry Reid spoke of the 2011 budget battle – expected to end with a vote on the compromise deal later this week – and the wrangling that lies ahead over the 2012 budget. "This budget battle has once again illustrated for the American people the fundamental differences between the two parties. In some cases, our priorities are poles apart," he said. "As we work toward finalizing this year's budget, as we start the conversation about next year's budget, and as we engage in the many other debates before us, Democrats will continue to insist on policies that reflect and respect our values."

Republicans see this as a last chance to overhaul entitlement programs before the bulk of the huge baby-boomer generation starts receiving Medicare and Social Security benefits. They compare this fight with the Clinton-era battle to overhaul the welfare system, led by the last GOP House majority. The 1996 welfare reform law limited the duration of cash benefits and gave states more authority to encourage work and control spending. "Opponents of these reforms said that they would lead to large increases in poverty and despair. Instead, the exact opposite occurred," the 2012 GOP budget document notes.

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