GOP offers $3.8T budget that boosts defense, cuts elsewhere

WASHINGTON (AP) - House Republicans launched a boldly-conservative 10-year budget plan on Tuesday that would favor the Pentagon, partially privatize Medicare and rely on deep cuts in other social programs to help wipe out deficits at the end of a decade.

A little more than four months after winning their largest majority in 70 years, Republicans promised an overhaul of the federal tax code and called for repeal of two of the top legislative achievements of President Barack Obama's tenure in office. Those are the health care law known by his name and a measure enacted to crack down on Wall Street after the economy's near-collapse in 2008.

Republicans said their balanced-budget promise came with no tax increases, though the fine print assumes the expiration of about $900 billion in breaks for business research and development and other items.

"The new normal of slow economic growth and low expectations is unacceptable. We know we can do better," the House Budget Committee, chaired by Rep. Tom Price of Georgia, said in a report accompanying the proposal.

It promised "greater prosperity, opportunity, security and freedom" if enacted.

Projected spending for the budget year that begins on Oct. 1 was $3.8 trillion, rising to $5 trillion in 2025.

Obama countered Republican claims instantly. He said the GOP prescription "is a failure to invest in education, infrastructure and national defense - all the things we need to grow, to create jobs, to stay at the forefront of innovation and to keep our country safe."

The president's own budget calls for about $2 trillion over 10 years in higher taxes on corporations, wealthy individuals and smokers of all income levels as part of a plan to increase spending and give tax breaks to the middle class.

Rhetoric aside, the release of the tax and spending plan in the House begins a rite of spring as reliable as the appearance of daffodil shoots on the Capitol grounds.

Senate Republicans intend to outline their own plan on Wednesday, and each house is expected to ratify its own version next week.

After that comes, the harder challenge of forging a compromise between the two versions, a task Republicans acknowledge will mark a test of their ability to govern now that they control both houses of Congress.

An even more difficult challenge follows, the translation of policy objectives into legislation that would be sent to Obama to sign or - more likely - veto. The budget also is certain to become an issue in the still-early race for the White House in 2016.

The House budget relies heavily in some areas on previous plans put together by Price's predecessor as committee chairman, Rep. Paul Ryan of Wisconsin.

It also adapts to changing political circumstances, most notably by offsetting a looming automatic budget cut in national security accounts.

The proposal would allow spending in the coming budget year of $36 billion more than Obama recommended for overseas military and diplomatic efforts.

Less than half of the $36 billion would be guaranteed, and the rest would depend on offsetting spending cuts elsewhere in the budget.

Some Republicans and outside groups bristled at the prospect of so large an increase, tucked into the budget in an account for overseas operations that is not subject to spending caps designed to hold down deficits.

"I'm tired of seeing gimmicks in the budget process," said Rep. Justin Amash of Michigan, a conservative and frequent critic of his party's leadership.

At the same time, the added funds could gain support for the budget from pro-Pentagon lawmakers for whom military spending is a top priority.

As in prior budgets, the House GOP budget calls for transforming Medicare into a voucher-like program for seniors who join the health care program beginning in 2024. They would receive a subsidy to purchase coverage, a step Democrats say would effectively end the current guarantee of services pegged to a pre-determined level.

In all, Republicans said they would cut spending by nearly $5.5 trillion over the next decade.

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