As lawmakers count down to “X-date” — the day the Treasury exhausts its extraordinary measures and officially reaches the debt ceiling — House Republicans are making their final preparations for negotiations with the White House and the Democrat-controlled Senate. While President Obama and congressional Democrats widely support a debt limit raise with no strings attached, Speaker John Boehner has abandoned his previous call for dollar-for-dollar cuts and has instead drawn up an assortment of menu options focused on reforming mandatory spending. Varying in size and scope, the prospective savings resulting from each of the proposed reforms would be tied proportionally to the length of time the Treasury’s borrowing authority is extended. The bigger the savings, the longer the government can continue to borrow.
The largest “entrée” on the menu is the enactment of Medicare premium support, a comprehensive and controversial reform championed by House Budget Committee Chairman Rep. Paul Ryan (R-Wisc.). The plan carries a price tag of a three-and-a-half year extension of the debt limit, and supporters believe the savings to Medicare would be significant as newly created market competition suppresses the skyrocketing costs ultimately burdening the program’s sustainability.
Further down the list, a medium-sized extension to the debt limit would equate to Medicaid or Supplemental Nutrition Assistance (SNAP, or “food stamps”) reforms – proposals directly from the House’s most recent budget. With the specific aim of providing states further flexibility to administer the programs with maximum efficiency, they would save the federal government $810 billion and $125 billion over 10 years, respectively. Chained-CPI is also on the table, but it is unclear to which of the several relevant programs it would be applied.
The smallest savings for the shortest extension include reforms to agricultural commodity and insurance programs — also in the House’s fiscal year 2014 budget — saving $31 billion over 10 years. Means-testing Social Security is put under this category as well. Though the particulars on this reform are hazy, a similar proposal to slightly reduce the benefit formula figures for the top 25% of beneficiaries has shown long-term savings of up to $59 billion over 30 years.
Though these specific selections may be controversial to some, one would have trouble denying that bringing down the ballooning costs of mandatory programs must go hand-in-hand with fighting deficits and massive national debt. Admittedly, it is hard not to perceive some of the smaller savings in the 10-year window as chump change compared to the repair needed for the largest mandatory programs. Net outlays for Medicare, Social Security, and Medicaid are individually projected to double by 2023 and together account for more than half of all federal spending within the same window. Social Security alone is anticipated to inflate to $1.41 trillion in 2023, totaling more than the projected annual discretionary outlays for the next 10 years.
Regardless of their often-entrenched ideologies, millennials must recognize that choices on mandatory spending must be made so as to ensure that these crucial safety nets can be preserved and fortified for not only for the Baby Boomers, but also their own generation.
James McKitrick is politically active conservative devoted to addressing America's massive national debt and its impact on millennials now and in the coming years. James is a blogger for The Can Kicks Back. Views expressed are not necessarily those of the campaign.
This article was originally published by The Can Kicks Back, a non-partisan and Millennial-driven campaign to defeat the national debt and reclaim our American Dream.