Sen. McConnell Blames Social Security, Medicare, and Medicaid Rather Than Republican Tax Cuts for Gr
Voters, especially older voters, should have no illusions about what congressional Republicans would like to do to reduce the federal budget deficit if they retain the majority. In an interview with Bloomberg News and TV, Sen. Mitch McConnell blamed budget deficits on the big three entitlement programs rather than last year's Republican tax cuts.
Data from the US Treasury Department, released yesterday, showed that the deficit had grown 17% in the last fiscal year to $779 billion, and the Congressional Budget Office has projected deficits of over a trillion dollars each year going forward. Much of the problem is the direct result of last year's corporate tax cuts which have dramatically reduced tax receipts from businesses.
New York Times [July 25, 2018]: "The amount of corporate taxes collected by the federal government has plunged to historically low levels in the first six months of the year, pushing up the federal budget deficit much faster than economists had predicted."
"The reason is President Trump’s tax cuts. The law introduced a standard corporate rate of 21 percent, down from a high of 35 percent, and allowed companies to immediately deduct many new investments. As companies operate with lower taxes and a greater ability to reduce what they owe, the federal government is receiving far less than it would have before the overhaul. "
Last year, as Republicans were finalizing their tax bill, McConnell had promised that tax reductions would be revenue neutral because they would pay for themselves.
The Hill: “I not only don’t think it will increase the deficit, I think it will be beyond revenue-neutral.” [McConnell] added, “In other words, I think it will produce more than enough to fill that gap.”
Now that the deficit is growing [as most economists and the Congressional Budget Office predicted], he has changed his story and says congress must cut Social Security, Medicare and Medicaid to reduce the government's red ink.
Bloomburg: "Senate Majority Leader Mitch McConnell blamed rising federal deficits and debt on a bipartisan unwillingness to contain spending on Medicare, Medicaid and Social Security, and said he sees little chance of a major deficit reduction deal while Republicans control Congress and the White House."
Senate minority leader Chuck Schumer pointed out the hypocrisy of McConnell's argument and reminded voters of the stakes in November:
The Hill: “As November approaches, it’s clear Democrats stand for expanding affordable health care and growing the middle class, while Republicans are for stripping away protections for people with pre-existing conditions and cutting Medicare, Social Security, and Medicaid to fund their giveaways to corporate executives and the wealthiest few,” he said."
A bit hyperbolic, but essentially accurate.