Last week, House and Senate majority and minority leaders worked together to create a much needed two year budget deal. The deal raised the debt ceiling for the rest of President Obama’s term and delayed budget disputes until after the 2016 election. These changes could possibly increase public confidence in Congress.
The deal was much needed and beneficial to both sides. For one thing, the deal raises spending 3.9 percent above 2012 sequestration levels put in place as a means to pressure negotiations. The increased spending of 80 billion dollars over the next two years will be put towards Social Security, Medicare and the Department of Defense.
The Social Security Trust Fund was set to be empty by next year, and enrollees would have faced a 20 percent cut in benefits. However, enrollees and big-government liberals will be happy to know that the deal shifts payroll tax revenue to the fund and will pay for all disability claims until 2022.
Defense hawks will also be pleased to know that out of the 80 billion dollars proposed for increased spending, half of it will go to defense funding, offsetting sequestration cuts. An extra 32 billion dollars will also be set aside for the Overseas Contingency Operations fund. This money is not affected by Congressional appropriations, and only the executive branch has the discretion to use it.
Both sides of the aisle should also be satisfied with the fact that the increased spending is also completely paid for. According to the Congressional Budget Office, the deal will cut 45.9 billion dollars and increase spending by 29.8 billion dollars over the next ten years through a variety of ways.
The deal extended cuts to repayments for Medicare doctors, which will generate 14 billion dollars in revenue; increased premiums to pension plans by 10 dollars per person over the next two years, generating 11 billion dollars; and increased the IRS’s power to audit and collect from equity firms, generating 11 billion dollars.
The deal also protects taxpayers from increased costs as well. The deal generates revenue by reining in exorbitant drug costs, requiring generic drug makers to pay a fee if drug prices outpace inflation, something that name-brand drug makers already do. Lawmakers also stopped a 52 percent premium hike for one-third of Medicare enrollees.
In the end, everyone got what they wanted and it is beneficial to all. Republicans received increased military spending through government reforms, and Democrats received increased funding for entitlement programs. Such bipartisanship renews faith in our elected officials. Conservatives such as Rand Paul and Ted Cruz denounced the deal for increasing the debt ceiling, yet the increased spending is entirely paid for.