Republicans have a plot to make Democrats take the fall for budget bill: report

The GOP is setting up Democrats to be the “fall guy” for their unpopular moves, according to Bloomberg columnist Erika D. Smith.

As Democrats point the finger at Republicans for potential cuts to Medicaid, Smith makes it clear it is a “mistake to assume the Democratic Party will escape blame entirely for the reconciliation bill.”

This is because the bill would transfer more of the costs of Medicare to the states. Currently, the federal government provides 90% of funding for people eligible for Medicaid under the Affordable Care Act.

Republicans in the Senate are looking to lessen the cost of Medicare by requiring states to pay more — thus making Democratic governors and mayors responsible for implementing cost-cutting measures.

“That’s [Republicans’] whole goal. They are transferring the burden onto the states so they can become unconscious pilots and wash their hands from what they know they’re doing,” Representative Raul Ruiz (D-CA) told Smith in a conversation last week.

“That could make Democrats the fall guys,” Smith said.

“Other than taxes, federal funding — and specifically Medicaid — represents one of the biggest sources of revenue for states,” Smith said.

Citing an analysis by Pew Charitable Trusts, Smith added, “In fiscal year 2024, for example, the program made up 69% of federal grants to the states.” It was the largest source of federal funding in all but one state.”

According to the Congressional Budget Office (CBO), Republicans want to cut Medicare by $700 billion. It would also end health care coverage for close to 8 million Americans.

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If the bill passes, Democratic governors and mayors will have hard choices about where funds will be cut. "Do Medicaid-funded homeless services get cut? Or should seniors lose resources? Which rural community will be denied a hospital?” Smith rhetorically asked.

“With the added pressure of having to pick winners and losers, Democrats run the risk of further antagonizing and dividing key constituencies in their coalition,” she added.

“It is handcuffing states to adapt,” Ruiz said of the reconciliation bill. “So what are [Democrats] going to do? They're going to raise taxes. They're going to take money from other programs. What’s more likely is that they’re going to cut benefits.”