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The Medicare Budget Buster By: David Keene
FrontPageMagazine.com | Tuesday, February 03, 2004

In the days preceding the vote on the Administration’s Medicare expansion, the skepticism voiced by conservatives over the White House estimate that the new drug benefit would cost “only” $400 billion over the next decade, were pooh poohed by Administration salesmen intent on rounding up votes for the bill.

The Heritage Foundation, for one, suggested that there was no reason to believe the figures being bandied about in light of the fact that today’s Medicare costs have already exceeded by more than 800% the long term cost estimates provided when the program was instituted back in the sixties. In many cases such costs are routinely underestimated by those seeking new legislation and often reflect “best case” estimates rather than a realistic assessment of what will happen once these programs are actually put into place.


In other cases those seeking new entitlements seem to pull their estimates out of thin air more as a sales tool than as a serious attempt to let policymakers know what new programs are likely to cost. As a result, many conservatives sought and, indeed, demanded that mechanisms be built into the new entitlement that would go into effect to prevent such cost escalation. These demands were rejected out of hand by Administration and Congressional leaders who essentially argued that folks should simply trust their numbers and their desire to keep this from happening.


Twenty-five House Republicans voted against the expansion in spite of these assurances and now have the right to stand up and say, “we told you so.”


Now comes the President’s 2005 Budget revealing that the Administration is now working with estimates more than 30% higher than those it was using to round up Congressional support for the largest entitlement increase since Lyndon Johnson’s buddies ran around spending like drunken sailors in the sixties.


The numbers speak for themselves. The ten-year $400 billion estimate has been increased by the President’s budgeters to $540 billion … and this increased estimate comes before the program is even launched. Those who thought the earlier numbers were being fudged were clearly correct and one must now ask why anyone should believe these new estimates.


The Administration and Republican Congressional leaders were upset by those who expressed skepticism earlier and probably won’t take kindly to those who suggest that they told them so. Members of Congress who stood on principle and refused to go along with the leadership were openly threatened in the hours before the vote. Indeed, Majority Leader Tom DeLay, who just two days earlier had spoken to conservatives in Florida about just how awful he thought the bill was led the leadership effort to bribe, bludgeon and trick his colleagues into going along with it in the name of party loyalty.


We are now told that the President’s “estimators” didn’t actually let the President in on their estimates until after the bill passed, but they did tell the Congressional leaders rounding up votes for it. One has to assume that they didn’t tell the President so that he could stick with the lower estimate without knowingly lying to lawmakers and others with whom he talked in the run up to the vote. Their now apparent strategy was to publicly stick with the Congressional Budget Office estimate of $395 billion, though they knew it to be far below what they themselves believed the legislation would cost. Congressional leaders, presumably including Senate Majority Leader Frist, House Speaker Hastert and House Majority Leader DeLay, were told, however, and then proceeded to lie to their reluctant troops who were scared stiff even by the smaller number.


Now the President claims that under his new budget, we will halve the deficit in five years. Ignoring the fact that most of the costs of the Medicare expansion won’t rear their heads until later and that the folks at OMB have managed to leave much of the funding everyone knows will be needed for our efforts in Iraq out, one is still forced to wonder how they really expect to do this.


They claim, of course, that they will eliminate up to 65 federal programs and cut many others. But the White House has already announced the National Endowment for the Arts has escaped the budget axe because of its importance to the nation. Frankly, if there are 65 less important programs, I’d like to see them.


The fact is that the Administration and the GOP Congressional leadership has little credibility on budget and spending questions right now and without credibility, there are likely to be more than a couple of dozen conservatives on the Hill willing to take matters into their own hands.


The President seems well-intentioned, but when his people are forced to explain to Congress that while he’s prepared to veto funds to repair bridges in their districts, his proposal to channel more money to local theater groups deserves support, the best of intentions aren’t likely to mean much and neither will his budget.

David Keene, chairman of the American Conservative Union, is a managing associate with the Carmen Group, a D.C.-based governmental affairs firm.

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