Debt Ceiling, March Spending Cuts Present Policy And Political Choices

As the White House and congressional Republicans wrestle with strategies to deal with these upcoming budget issues, Medicare and Medicaid will be important factors.

The New York Times: Difficult Choices On Debt If The U.S. Hits The Ceiling
The Treasury Department is undertaking "extraordinary measures," … to leave it with more cash on hand. But such measures buy the country only so much time. … That day might be Feb. 15, for instance. According to a Bipartisan Policy Center analysis, the government expects about $9 billion in revenue to arrive in its coffers that day. But it has $52 billion in committed spending on that day: $30 billion in interest payments, $6.8 billion in tax refunds, $3.5 billion in federal salaries, $2.7 billion in military pay, $2.3 billion in Medicaid and Medicare payments … and a smattering of other commitments. The Treasury would be confronted with paying doctors but not soldiers (Lowrey, 1/17).

Los Angeles Times: House GOP Weighs Backing Off Default Threat
The threat of the coming March cuts – which both parties have said they hope to avoid – provide an opportunity for the GOP to try to force Obama and Senate Democrats to consider alternative reductions elsewhere. Republicans have long sought to spare the Pentagon from cuts and shift the burden to other domestic programs, including Medicare and safety net programs. But to get to that debate, Republicans must first dispatch with the need to raise the nation's debt limit, which could come as soon as mid-February (Mascaro, 1/17).

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