More Debt, Big Medicare Cuts: The GOP Budget Is a Mess

The Republican budget plan cleared the Senate. Now it's on to the House. Molly Riley/Reuters

President Donald Trump was up late, tweeting and happy—or at least that was true for his social media maven, Dan Scavino. It was 1 a.m. on Friday and the Senate had passed a budget outline that not only sets the country's fiscal course for the next year but that lowered the threshold for passing tax reform. " This now allows for the passage of large scale Tax Cuts (and Reform)," Trump tweeted Friday morning, giving himself a pat on the back. But the budget plan that passed the Senate late Thursday night and that is expected to sail through the House is a mess.

Great news on the 2018 budget @SenateMajLdr McConnell - first step toward delivering MASSIVE tax cuts for the American people! #TaxReform

— Donald J. Trump (@realDonaldTrump) October 20, 2017

A budget outline isn't the same thing as a final budget. It just sets the broad parameters. In this case, the outline allows Congress to add $1.5 trillion to the deficit—even though the national debt is already north of $20 trillion and more than 100 percent of the U.S. gross domestic product, a level that alarms many economists.

A tweet from the chairman of the National Economic Council under President Barack Obama, Jason Furman, pointed out that $1.5 trillion would have funded the entire Affordable Care Act and universal kindergarten. Republican Senator Bob Corker of Tennessee called the budget "a hoax," though he voted for it.

To put the $1.5T tax cut in the budget in perspective--would have allowed the entire ACA unpaid for + universal preK with change to spare.

— Jason Furman (@jasonfurman) October 20, 2017

Deficit hawks were alarmed. "Today, with their vote, the Senate GOP has turned away from this goal, sprinting in the other direction and instead approving a plan that allows for $1.5 trillion in tax cuts to be added to the national debt," says Maya MacGuineas, president of the Committee for a Responsible Federal Budget.

But some of those who might have been expected to balk at a plan that raises the national debt were conspicuously silent. That's because the plan has benefits for some of the senators who have given the White House trouble. It has huge defense budget increases that pleased Senator John McCain of Arizona, whose vote this summer proved decisive in killing the repeal and replacement of Obamacare. There's also a benefit for Lisa Murkowski, the Alaska Republican who was another to balk at the Obamacare repeal that was backed by the White House. The budget bill created a provision to allow for drilling in the Arctic National Wildlife Refuge.

Democrats were furious. "This nasty and backwards budget green-lights cuts to Medicare and Medicaid in order to give a tax break to big corporations and the wealthiest Americans," Chuck Schumer of New York, the Senate minority leader, said.

House Republicans had passed a budget outline that was revenue-neutral, but they're almost certain to approve the Senate's deficit-heavy plan next week when they return from their district work period. That will pave the way for both chambers to move quickly on a tax overhaul, with the House and Senate tax-writing committees releasing their plans next week. That tax reform plan could add an incredible $6 trillion to the deficit.​