Five Republican members of Congress—Chip Roy of Texas, Ralph Norman of South Carolina, Josh Brecheen of Oklahoma, Andrew Clyde of Georgia, and Lloyd Smucker of Pennsylvania—voted in committee Friday against the Trump budget reconciliation package because it didn’t do enough to reduce the deficit. As a result, the measure failed, 16–21. The bill later passed Sunday night after Smucker switched to a “yes” (his initial “nay” was just a procedural maneuver allowing him to reintroduce it) and the four remaining rebels voted “present.”
This mini-uprising, which may not be over, furnishes an opportunity to consider the state of fiscal conservatism within the Republican Party. It’s a fraud.
The four rebels are all members of the House Freedom Caucus. Roy is its policy chair. The Freedom Caucus was founded in 2015 largely (but not exclusively) to push mainstream Republicans harder to balance the federal budget. After the budget bill advanced Sunday night, the caucus’s board complained in a statement posted on Twitter that the budget bill “continues increased deficits in the near term with possible savings years down the road that may never materialize” and fails to “lead our nation towards a balanced budget.”
No argument there. The House budget bill, comically titled “The One, Big, Beautiful Bill” (text; section-by-section summary), is a piece of legislation no honest fiscal conservative can support. Its tax provisions would, over 10 years, cost $4.6 trillion, according to the Penn Wharton Budget Model. The bill’s offsetting spending cuts—mostly decimating Medicaid, the state-federal program that provides health care to lower-income people—would save $1.3 trillion. The net effect would more than double the current budget deficit ($1.9 trillion) to $5.1 trillion.
Let us note, class, that the cost of the tax cut is more than three times the savings from spending cuts. As a matter of simple arithmetic, a fiscal conservative should be more interested in the $4.6 trillion figure than in the $1.3 trillion figure. As Willie Sutton would say, $4.6 trillion is where the money is.
Yet the Freedom Caucus rebels don’t especially care that their party wants to piss away $4.6 trillion in tax cuts. What they object to is that their party wants to cut Medicaid spending only by about 10 percent.
“To my friends on the left,” Ralph Norman said at the Friday markup, “you’re being untruthful. You say however you want to say, but to say we’re cutting Medicaid, Medicare, Social Security is simply untrue.” Huh? Nobody says House Republicans are cutting Medicare and Social Security. What they’re cutting is Medicaid, and that is indisputably true. Norman went on to say: “The tax cuts are great. The tax money is the taxpayers’ not the government bureaucracy.” Even when the tax cuts cost $4.6 trillion?
Norman’s beef with Medicaid is that it doesn’t require recipients to work. As a consequence, Norman said last week, “It’s being stretched thin by able-bodied adults and even illegal immigrants who’ve never paid into the system.”
The man’s either a fool or a liar. Undocumented immigrants are ineligible to enroll in Medicaid. Meanwhile: What “system”? There is none. Medicare, the health care program for people aged 65 and over, is funded through a dedicated payroll tax, but there’s no payroll tax for Medicaid; that’s funded by general revenues from the federal government and state governments. And, oh, I almost forgot: The problem of Medicaid recipients not working doesn’t exist. Among able-bodied Medicaid recipients under 65, 64 percent work full- or part-time, and those who don’t typically attend school, have a disability that prevents them from working, or are providing care to a family member in lieu of employment.
A question perhaps for another day: Why should we even care whether people who require medical treatment demonstrate moral fitness? We don’t deny health care to serial killers serving life sentences in prison.
The cuts to Medicaid that Norman says don’t exist consist largely of those same work requirements Norman says he’s for. Norman and his other Freedom Caucus compatriots want these to take effect sooner, and House Speaker Mike Johnson is working to do that. The work requirements throw sufficient sand into the gears that some proportion of beneficiaries will say the hell with it, even if they have jobs. (Private health insurers play a similar game; artificial intelligence turns out to be a fabulous tool for generating inaccurate claim denials.) The Congressional Budget Office has shown that work requirements don’t increase employment among Medicaid recipients. They just reduce enrollment—which is all that the proponents of cuts really want.
It would be unfair to conclude the Freedom Caucus’s fake fiscal conservatives are entirely hypocritical about tax cuts. “We have to deliver on extending the tax cuts,” Roy said in one tweet Monday, but in another tweet that same day he complained that the bill left “half of the green new scam subsidies continuing.” By “green new scam subsidies,” Roy meant tax breaks passed by President Joe Biden under the Inflation Reduction Act to encourage manufacturing of climate change technologies—mostly in Republican states! The House bill cancels about $500 billion of these tax credits. We liberals call that a tax increase.
Many expected the House GOP would try to find a way to take credit for these green tax credits that Biden lavished on GOP constituencies. I kind of expected that myself. I never imagined House Republicans would instead decide these tax credits had cooties. Indeed, to pacify the Freedom Caucus the House GOP may have to cancel more green tax cuts tainted by association with Democrats. Those will be tax increases too.
But they won’t be big enough to make much difference. The House bill will still double the budget deficit. Where do Freedom Caucus members get off calling themselves fiscal conservatives? Moody’s doesn’t buy it. On Friday, it downgraded United States Treasuries, and on Monday the bond market freaked out. Unlike Roy, Norman, Brecheen, and Clyde, Wall Streeters bother to count. These clowns should try it sometime.