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War Over Spending Kicks Off in Earnest

Republicans blasted President Barack Obama for bypassing the nation’s fast-growing entitlements in his $3.7 trillion fiscal 2012 budget blueprint Monday — but they now have to figure out how bold they will be on the issue.

While the administration contended that the president’s plan returns the deficit to sustainable levels by the middle of the decade after spiking to a record $1.65 trillion this year, Republicans argued the budget fails to deal with fast-rising costs for Medicare, Medicaid and Social Security.

“The budget was an opportunity for the president to lead. He punted,” Senate Minority Leader Mitch McConnell said.

The Kentucky Republican dismissed the $1.1 trillion in claimed deficit savings over a decade as a “status quo” budget and criticized the president for proposing new spending on clean energy and high-speed rail even as he trimmed spending elsewhere.

“We don’t have the money, Mr. President,” McConnell said. “We’re broke.”

And House Majority Leader Eric Cantor (Va.) threw down the gauntlet on Social Security, Medicare and Medicaid reform, explicitly challenging Democrats to show their cards on the issue. Entitlement reform has been atop Members’ list of reforms for decades, but neither party has been willing — or able — to take it on.

Republicans “will be presenting at the end of next month … our own budget, a serious document that will reflect the type of path we feel we should be taking to address the fiscal situation, including addressing entitlement reforms, unlike the president did in his budget,” Cantor said.

“It is high time that we see plans from [Senate Majority Leader] Harry Reid [Nev.] and this president. We want to see their plans,” Cantor said.

When asked whether he planned to include actual reforms in the Republican budget, Cantor demurred on specifics but was adamant they will be addressed.

“We will include entitlement reform provisions in our budget, again, unlike the president, and unlike Harry Reid who doesn’t even admit there needs to be any reform of Social Security,” he said.

Jon Summers, spokesman for Reid, parried Cantor’s attack. “Sen. Reid does not support the efforts of Cantor and other Republicans [whose] proposals would kill Social Security as we know it. If he’s serious about cutting spending, I would love to hear his plan for taking away the tens of billions of dollars in taxpayer subsidies that currently go to Big Oil.”

Aside from the political back and forth, Budget Chairman Paul Ryan (R-Wis.) said it will take a “family conversation to reach consensus” in the Republican Conference and refused to commit to taking on entitlements in his budget.

“Clearly we need to go there,” Ryan said, but he noted that he needs to find 218 votes to do so.

Republicans have been hesitant to endorse specific entitlement cuts without presidential cover and have so far focused on cutting a big chunk out of a small sliver of the overall budget — domestic discretionary accounts.

And they are split behind the scenes on the wisdom of stoking a battle over popular programs such as Social Security unless Obama gets on board.

A senior GOP leadership aide said Cantor is trying to challenge Democrats into a battle over entitlement reform and believes it will be a win-win for Republicans.

“These are huge problems and they need to be addressed. The president ignored them and we need to do something about it,” the aide said.

If they do force changes, in Social Security for example, they can take credit for fixing a broken system, the aide said. And if Democrats ultimately don’t take the bait, so long as Republicans make at least some sort of reform proposal, they can blame Democrats for failing to act.

But other Republicans are much more wary of jumping into a Social Security fight. One GOP aide pointed out that conservative reform proposals are never popular with seniors — who vote in disproportionate numbers. And, the aide added, Republicans’ electoral fortunes began to go south in 2005 when President George W. Bush pushed unsuccessfully for Social Security reform.

“We don’t want to get into this fight either. … We’re not prepared to engage people when they turn around and say, ‘OK, what’s your plan? You’re in the majority now,’” the aide said.

“I really feel like we’re kicking a hornet’s nest. … We didn’t get elected to reform entitlements. We got elected because we’re not as bad as them,” the aide added.

Democrats also are split between liberals who want to use the Republican fervor for budget cuts in Social Security and elsewhere against them in 2012, and moderate Democrats who are hoping to cut a grand bipartisan deal along the lines of the president’s own fiscal commission. That commission cut $4 trillion from the deficit over the coming decade, about four times Obama’s $1.1 trillion cut, and sliced deeply across the government.

Democrats, meanwhile, used Obama’s budget release to help frame the debate for this week’s House debate on the continuing resolution. Republicans are proposing a $58 billion cut to current spending — $100 billion less than Obama’s initial request — with steep cuts to numerous domestic spending programs.

Obama and Democrats are united in opposing deep cuts now, preferring a five-year freeze in domestic discretionary spending. Democrats and the president warn that cutting too much too soon could hurt the economy and damage programs, such as scientific research and education, that will boost the economy in the long run.

Still, there was talk from Members on both sides of the Capitol that they would try to reach a broad bipartisan agreement on the long-term debt that would go beyond the budget, which Democrats and Republican aides acknowledged privately is more a political document than a governing one.

Senate Majority Whip Dick Durbin (D-Ill.), who voted for the fiscal commission’s recommendations, praised Obama’s budget but at the same time noted that he’s been working with a bipartisan group on a grand debt deal.

“It will take a lot of work, but we can do it if we work together,” Durbin said.

The administration is pitching its budget request as an opening for working with Republicans. Officials point to Obama’s successful negotiation last year of an extension of the 2001 and 2003 tax cuts as a hopeful sign that the White House and the GOP can come together.

“Even though we may have some differences at the outset, we are very eager to work with the Republicans to cut spending [and] reduce our deficit,” a senior administration official said.

But McConnell said the president has to be bolder.

“We’ll need a president who gets it. And this president clearly does not get it — yet.”

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