How the New Budget Deal Just Doomed Your Entitlements

The congressional budget deal that passed just before daybreak this morning (Feb. 9) is one sneaky piece of legislation.

That's because it set the standards for the next two years of government spending, upending crucial budget control legislation.

The excess spending the new budget agreement allows will balloon America's federal deficit to the point of unsustainability, meaning cuts will have to be made elsewhere to shore up costs.

And we know just what programs would be sent to the chopping block...

Congress' Budget Deal Is the Beginning of the End for Entitlements

The new budget agreement will force Congress to cut entitlements.

budget deal

That's because it rolls back the Budget Control Act (BCA), enacted in 2011 to keep federal spending under some semblance of control. The new agreement flagrantly disregards the BCA, mandating that government spending increases by $300 billion over the next two years (roughly $80 billion per year on defense, $64 billion per year on non-defense).

That $300 billion sum will be added to Uncle Sam's tab - which is already expected to grow an additional $1 trillion over the next 10 years thanks to the Tax Cuts and Jobs Act.

These expenditures can't just grow unimpeded. Something has to give.

That's why this budget agreement spells doom for Social Security, Medicare, and welfare as we know it.

Here's how we know Congress will put entitlements in its sights first...

Congress Has Been Trying to Cut Entitlements for Months

In March 2017, Congress released the American Health Care Act as a replacement to the Affordable Care Act (Obamacare).

The AHCA sought to cut $880 billion in Medicaid spending by 2026, which would have forced 14 million people out of the program, according to the nonpartisan Congressional Budget Office.

The bill failed to pass.

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In May 2017, members of Congress proposed slashing more than $400 billion in entitlement spending - which accounts for 59% of the annual budget - through the reconciliation process in order to balance the national budget. The proposal, part of the House Budget Committee's fiscal 2018 budget, would have forced each department to make sweeping cuts without any consideration for the needs of each department or the populations they serve.

Some analysts believe that even President Trump's tax cuts - and the resulting $1 trillion deficit increase - will be used to justify entitlement cuts.

"That [deficit increase] will be a rallying cry for why [Congress members] have to deal with entitlement programs, even though they created the problem," Dee Mahan, director of Medicaid initiatives for Families USA, a consumer healthcare advocacy group, told CNBC on Dec. 6.

Indeed, immediately after tax reform passed, House Speaker Paul Ryan - arguably the most vocal proponent of entitlement cuts in Congress - admitted that GOP legislators' targets for closing that future trillion-dollar gap include Social Security, Medicare, and welfare cuts in the very near future.

"We're going to have to get back next year at entitlement reform, which is how you tackle the debt and the deficit," Ryan said that day, according to Vox.

And now, Congress just added $300 billion to the fire.

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