AARP opposes Senate tax bill, calls Medicare cuts and Obamacare mandate repeal ‘troubling’

AARP, the large lobbying group for older Americans, opposes the Republican-sponsored Senate tax bill.
AARP warns the bill could lead to sharp cuts to Medicare, the federal health insurance program for seniors.
The group also is concerned the bill will lead to tax increases on many older Americans, and higher Obamacare insurance premiums.
Dan Mangan | @_DanMangan
Published 12:45 PM ET Thu, 30 Nov 2017 Updated 1:25 PM ET Thu, 30 Nov 2017 CNBC.com
Senate Majority Leader Mitch McConnell, a Republican from Kentucky, center, speaks as Senator Orrin Hatch, a Republican from Utah, left, and Senate Majority Whip John Cornyn, a Republican from Texas, listen during a news conference after a weekly GOP luncheon meeting at the U.S. Capitol in Washington, D.C., on Tuesday, Nov. 28, 2017.
AARP, the lobbying group for almost 38 million older Americans, on Thursday blasted the Senate’s proposed tax bill for threatening cuts to Medicare, repealing a key Obamacare rule and hiking taxes on many seniors.

“We urge the Senate to vote NO on the proposed tax legislation that will cut billions of dollars from Medicare and increase taxes for millions of older Americans,” AARP said in a tweet pinned to the top of its Twitter page.
AARP’s position, laid out in a letter to senators, came as the Senate prepared for a series of preliminary votes on the controversial Republican-sponsored legislation, which could end with a final vote on the bill by late Thursday or Friday.

No Democrats are expected to vote for the bill.

The group’s CEO, Jo Ann Jenkins, wrote that AARP is “prepared to support tax legislation that makes the tax code more equitable and efficient, promotes growth, and produces sufficient revenue to pay for critical national programs, including Medicare and Medicaid.”

“However, the Senate Tax Cuts and Jobs Act, in its current form, does not meet these criteria,” Jenkins wrote.

Her letter said the “most troubling” aspect of the GOP’s tax bill was the fact that it would add $1.5 trillion to the federal deficit over the next decade,” hampering the nation’s “ability to fund critical priorities.”

That big boost in the deficit will “inevitably lead to calls for greater spending cuts, which are likely to include dramatic cuts to Medicare, Medicaid and other important programs serving older Americans,” the letter warned.

AARP cited the Congressional Budget Office’s finding that the bill would trigger automatic funding cuts of $136 billion next year, $25 billion of which would be from Medicare, unless Congress separately took action to prevent that.

Medicare is the massive federally run health coverage program that covers 59 million Americans, most of them age 65 and older.

Medicare and other programs would risk automatic funding reductions under the PAYGO law, which require offsets from increases in projected budget deficits resulting from new legislation.

“Such sweeping cuts would be detrimental to an already vulnerable population,” the letter said.

AARP also said the Senate bill “may not deliver tax cuts that older Americans anticipate.”

The group noted that the Joint Committee on Taxation has projected that starting in 2021, people who earn between $10,000 and $30,000 annually will see their taxes rise under the Senate bill. And by 2027, filers with incomes below $75,000 will see taxes rise by $27.4 billion if the bill becomes law.

AARP’s own estimates found the bill would hike taxes on 1.2 million people age 65 and older in 2019, and that the number of people in that age group seeing higher taxes would be 5.2 million by 2027.

“In addition, this bill will provide no tax relief for 5.1 million older taxpayers in 2019 and 5.6 million taxpayers by 2027,” the letter said.

AARP said it also opposes the bill’s repeal of Obamacare’s individual mandate, which requires most people to have health insurance of some kind or pay a tax penalty.

CBO has estimated repeal would lead to 13 million more Americans lacking health insurance by 2027, and that individual health plan premiums would be 10 percent higher each year than they otherwise would have been.

AARP said that translates into 64-year-old Obamacare customers facing premiums almost $1,500 higher annually.

Sen. Susan Collins, R-Maine, told reporters on Thursday that Senate Majority Leader Mitch McConnell, R-Ky., gave her “a personal commitment” that Congress would act to prevent the automatic big cuts to Medicare and other programs triggered by the tax bill.

“I met with Senator McConnell just yesterday, and he has assured me that that will not be allowed to happen,” Collins said, according to Talking Points Memo.

“If it were going to occur, I would not even be considering voting for this [tax] bill.”

However, McConnell does not have the power to guarantee that promise. While passing the tax bill will require just 50 Republicans to vote for it, passing a waiver of PAYGO restrictions would require at least eight Democrats to join the 52 GOP senators in voting for the measure.

And it is far from clear that any Democrats in the Senate will choose to do so.

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John McCain Claimed He Cares About “Honor” in the Senate. His Tax Vote Shows He Lied.

Jon Schwarz

December 2 2017, 6:55 a.m.

Sen. John McCain of Arizona joined 50 fellow Republicans on Friday night in voting yes on a Senate bill that slashes taxes on corporations and billionaires, while enacting the largest tax increase in history on many poorer Americans.

That McCain supports such policies is no surprise, given his ideological history. However, his vote is shocking nonetheless in its flagrant violation of all the values McCain claimed to hold just a few months ago.

Senators received the tax bill hours before voting, in an unsearchable version so new that it had handwritten changes. Members learned of possible amendments from lobbyists. There were no regular committee hearings, or any attempts whatsoever to involve Democrats.

There may be no historical precedent for jamming through a bill of such significance in this manner – except the chamber’s efforts this past July and September to repeal the Affordable Care Act. But in those instances, McCain loudly proclaimed he could not vote for those bills because of his devotion to regular order in the Senate.

McCain returned to Washington in late July soon after being operated on for brain cancer in order to vote on the first GOP healthcare bill, and delivered a dramatic speech that CNN called “a Washington moment for the ages.”

“As I stand here today,” McCain declared, “I have a refreshed appreciation for the protocols and customs of this body.”

It was wrong, he said, to force through “social and economic change” that was “massive” without any support from across the aisle. Republicans were trying to do this “by coming up with a proposal behind closed doors in consultation with the administration, then springing it on skeptical members.”

So, McCain said, “Let’s return to regular order … the old way of legislating in the Senate, the way our rules and customs encourage us to act.” The Senate’s traditions were “deliberately intended to require broad cooperation to function well at all.”

He then concluded with a stirring paean to slow, deliberative lawmaking, asking, “What greater cause could we hope to serve than helping keep America the strong, aspiring, inspirational beacon of liberty and defender of the dignity of all human beings and their right to freedom and equal justice?”

To McCain’s credit, he then did vote against the Republican healthcare bill shortly afterwards. And his announcement in September that he would not support another GOP run at the American Care Act led to Majority Leader Mitch McConnell shelving the issue indefinitely.

In the interim, McCain took the time to again express his dedication to Senate traditions and bipartisan compromise in a Washington Post op-ed.

“We seem convinced that majorities exist to impose their will with few concessions,” he wrote. But this was dangerous: “We might not like the compromises regular order requires, but we can and must live with them if we are to find real and lasting solutions. And all of us in Congress have the duty, in this sharply polarized atmosphere, to defend the necessity of compromise before the American public.”

In particular, McCain said, “Let’s try it on tax reform.” This would “prove the value of the United States Congress to the great nation we serve.”

McCain clearly now feels some sensitivity about his shameless about-face. “I have called for a return to regular order,” he weakly explained in a statement about his support for the tax bill, “and I am pleased that this important bill was considered through the normal legislative processes, with several hearings and a thorough mark-up in the Senate Finance Committee during which more than 350 amendments were filed and 69 received a vote.”

For anyone who understands Senate procedure, this is meaningless. “Citing filed amendments is deeply cynical and shows that he doesn’t really care about regular order,” says Adam Jentleson, former deputy chief of staff for Nevada Democrat and one-time Senate Majority Leader Harry Reid. “He just used it because it’s a big number and he thinks no one will call him on it. … It could be a million amendments filed but that doesn’t mean any of them received real consideration.”

And it’s simple even for non-experts to judge McCain’s sincerity. The Senate Finance Committee debated the bill for a mere four days, and passed it on a party line 14-12 vote. By comparison, the same committee conducted 33 days of hearings on the comparable Tax Reform Act of 1986 — in 1985, a year before the vote — followed by a subsequent month of drafting meetings. Eventually the bill was unanimously approved by the Finance Committee, and subsequently passed the entire Senate in mid-1986 by a vote of 97-3 after three weeks of floor debate.

It’s impossible to know McCain’s true motives, of course, and his office did not immediately respond to a request for comment. But the tax bill does differ from the attempts to repeal the Affordable Care Act in one key aspect: It directly benefits McCain and his family in obvious ways. His wife Cindy McCain’s estimated $100 million fortune is largely based in her ownership of liquor distributor Hensley Beverage, which would gain from the bill’s cut to alcohol taxes. It also will allow the McCain children to inherit $22 million tax free, doubled from the $11 million exemption under current law.

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Chuck Grassley Says Working Class People Don’t Deserve Tax Cuts Because They Spend Their Money On Booze And Women

By Jason Easley on Sun, Dec 3rd, 2017 at 6:11 pm

Sen. Chuck Grassley (R-IA) suggested that rich people deserve tax cuts more than working class people because working class people spend all of their money on booze, women, or movies.

Grassley told the Des Moines Register, “I think not having the estate tax recognizes the people that are investing, as opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies.”

In the Republican view of America, there are two classes of people, the deserving rich, and the undeserving everyone else.

Sen. Orrin Hatch (R-UT) also expressed this view when he said during the tax cut debate that Republicans no longer have the money to pay for children’s health insurance, “[L]et me tell you something: we’re going to do CHIP. There’s no question about it in my mind. It’s got to be done the right way. But we, the reason CHIP’s having trouble is because we don’t have money anymore.”

The problem with the thinking of Grassley and Hatch is that rich people don’t reinvest their tax cuts back into the economy. If a tax cut is given to someone making $25,000-$75,000 a year, they put the money back into the economy. They don’t spend the money on women and booze and Grassley said. They pay bills or make purchases that they have put off for a long time because they couldn’t afford it. They don’t blow the money. Working class people put their tax cuts back into the economy, and benefit businesses.

Grassley was suggesting that working class people lack the morals to deserve a tax cut, and Hatch directly stated that Republicans drained the treasury and let children suffer.

The mentality expressed by Sen. Grassley shows why Republican trickle-down economics always fails. Republicans don’t care that cutting taxes for the rich doesn’t work because they believe that the wealthy are morally superior to everyone else.

 

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