House Republicans say adopting work requirements for federal entitlement programs and putting caps on federal spending could help balance the budget over the next decade.
GOP lawmakers are unlikely to release their official budget proposal for weeks, but aides stress that “everything is on the table” outside of raising taxes or cutting Social Security and Medicare.
House Speaker Kevin McCarthy has told Republican lawmakers that “Social Security and Medicare are ‘off the table” when it comes to cuts, according to a senior GOP aide with knowledge of the talks. “But that means nearly everything else is on the table if we want to be serious about balancing the budget and ending runaway spending.”
Balancing the budget and paying down the existing $1.4 trillion deficit would require a decrease in federal spending of 27% over the next decade, according to the Committee for a Responsible Federal Budget, a D.C.-based nonprofit public policy group that advocates for sound fiscal policy. Federal spending would have to be cut by 78% if Medicare, Social Security, defense, and veterans benefits are excluded, the group said.
“These cuts would be so large that it would require the equivalent of ending all nondefense appropriations and eliminating the entire Medicaid program just to get to balance,” the group wrote in a recent white paper.
House Republicans believe they can get close to the goal of a balanced budget by capping federal spending at levels authorized by President Biden’s 2022 fiscal budget. Those spending levels are at least $130 billion lower than what Congress opted to appropriate in December when passing a $1.7 trillion measure to fund the government until the end of September 2023.
Defense spending alone has grown by nearly 10% — from $782 billion to $858 billion — between the 2022 and 2023 fiscal years. GOP lawmakers say that defense spending is likely to be excluded from the cap and the difference can be made up by slashing domestic spending.
“This means cutting funding for the woke and weaponized bureaucrats that received massive increases under the $1.7 trillion omnibus,” said Rep. Chip Roy, Texas Republican.
Another cost-saving measure that Republicans are eyeing is work requirements for entitlement programs like Medicaid and food stamps. Both programs have grown substantially since being overhauled by President Bill Clinton and Republicans in the 1990s.
Medicaid added 20.2 million people to its rolls between February 2020 and October 2022 alone, costing the federal government $592 billion. The number of people getting food stamps, meanwhile, has grown by nearly 2.5 million since July 2019.
Republicans have long argued that able-bodied adults without dependents should work in exchange for receiving welfare benefits, especially with nearly 11 million job openings across the U.S.
“We know that work is the only path out of poverty,” said Rep. Dustry Johnson, a South Dakota Republican who is backing legislation to expand work requirements for food stamps.
Expanding work requirements for both programs would impact about 40 million people, according to Congressional Budget Office. Medicaid would feel the biggest brunt of the change.
Under the proposal being weighed by House Republicans, able-bodied adults between 19 and 49 would be required to work at least 80 hours per month to receive Medicaid. Excluded from the work requirements would be Medicaid recipients who are pregnant, have children, or have a disability preventing them from being able to work.
The work requirements are similar to those already adopted by a handful of states, including Arkansas. The CBO estimates the change would save $135 billion in Medicaid costs throughout 2033.
Such savings, however, would mean kicking off about 2.2 million adults from the program. That makes the changes a hard sell to Mr. Biden and Senate Democrats ahead of the 2024 elections.
Mr. Biden has proposed his own $6.8 trillion budget that is set to pay down the deficit by hiking taxes by more than $5.5 trillion. The White House has sought to paint House Republicans as unserious by proposing to balance the budget while ruling out raising taxes.
“What are they going to cut,” Mr. Biden said during an event last week to promote his budget. “How will they make these numbers add up?”