Medicare has become the pivotal political issue in Washington, not just in the deficit debate but in the Republican 2012 election as well. GOP primary candidate Newt Gingrich has spent his week furiously backpedaling from his observation on Meet the Press last weekend that Paul Ryan’s Medicare plan amounts to “right-wing social engineering.” The incident shows that a willingness to gut Medicare has become the price of acceptance into the Republican Party.
As Jamelledescribed yesterday, California just cut its deficit in half, not through dramatic spending cuts but through an unexpected tax windfall, the result of improved economic growth in the state. It’s not unique in experiencing this – Michigan and New Jersey also reported higher-than-expected tax revenues this week.
As expected, the JOBS Act we [previewed](http://prospect.org/csnc/blogs/tapped_archive?month=05&year=2011&base_na...) earlier this week received a passing vote in the House Ways and Means Committee yesterday, giving states the option to use the money they receive from the federal government for extended unemployment benefits elsewhere. GOP lawmakers expect cash-strapped states will divert the cash toward deficit reduction, which they see as a more pressing goal.
Despite the fact that a deficit-reduction deal probably won’t be reached through the adoption of a comprehensive budget package, lawmakers continue to produce them, tweaking the available deficit-reduction mechanisms to just their liking. So far this week, Sens. Pat Toomey and Kent Conrad have both released budgets, although Conrad’s has yet to go public. What they both show is a response to the backlash to Paul Ryan’s budget and the GOP’s current budget strategy.
Soon, the House Ways and Means Committee will vote on legislation that would allow states to divert the money they receive from the federal government for extended unemployment-insurance benefits toward other uses that would help them get their financial houses back in order. While states will eventually have to deal with their deficits, doing so at a time when the unemployment rate remains at 9 percent and 4.1 million workers are accessing extended benefits (the additional supports that kick in after 26 weeks of unemployment) defies logic.