The U.S. Senate’s budget plan calls for deep cuts in supports that low- and middle-income Minnesotans count on and would likely shift to the states more of the responsibility in making sure that families have enough food on their table or can access the health care they need. While the details around the edges might differ, the Senate plan looks a lot like the U.S. House budget resolution and President Donald Trump’s budget.
The Senate passed its budget proposal on Thursday. Among its main components are:
- $4.1 trillion in cuts over 10 years to entitlements. Much of these cuts would be in health programs. The proposal calls for a $1.3 trillion cut primarily to Medicaid and subsidies through the Affordable Care Act to make health insurance affordable, as well as a $473 billion cut to Medicare. The proposal also proposes deep cuts to other entitlements. Cuts are likely to come from supports for some of the lowest income folks, like SNAP food assistance, the refundable portion of the Earned Income Tax Credit, and Temporary Assistance for Needy Families. Without access to affordable health insurance, food, and other basic necessities, many Minnesota families will certainly face additional barriers in trying to make ends meet.
- $800 billion in cuts over 10 years to annual non-defense appropriations, the area of the budget which funds K-12 education, infrastructure, low-income housing, environmental protection, and many other programs that build strong communities. This area of the budget is already subject to strict funding caps and the Senate’s proposal would cut even more deeply.
- Large tax cuts that will overwhelmingly benefit the highest income U.S. households. The Senate plan paves the way for at least $1.5 trillion in tax cuts over 10 years. Estimates of the tax framework recently released by the White House and Republican leaders in Congress show that 80 percent of the tax cuts would go to the 1 percent of Americans with the highest incomes when fully in effect. The tax cuts will be considered under the fast-track “reconciliation” process that only requires a simple majority in the Senate to pass. Everyday Minnesotans would pay for these tax cuts, either through immediate cuts to critical programs that help Minnesota families thrive, including health coverage, tax credits for low-income families, and basic assistance for poor seniors and people with disabilities, or in the future when dramatically higher deficits would ultimately force cuts to health care, education, infrastructure, and other building blocks of economic growth.
- A rule change that would make it easier for the Senate to consider bills without a cost estimate from the Congressional Budget Office. The recent last-minute votes on health care proposals that would have caused deep harm to Americans’ access to health care underscore the need for full analysis of major legislation before policymakers take a vote. It is impossible for policymakers to make sound decisions and for the public to weigh in without having information in their hands.
Additionally, many of the Senate budget resolution’s provisions will likely push increased financial responsibility to the states. A recent economic update indicates that Minnesota may not be well positioned to meet the needs of Minnesotans if federal funding decreases.
The next step is for the Senate and the House, which passed its budget resolution in July, to reach agreement on a common plan. For insight into how this budget resolution fits in the federal budgeting process, check out the Minnesota Council of Nonprofits’ federal policy website and its federal budget tracker and appropriations infographic.
-Clark Goldenrod