economy

 (Reuters) – The House of Representatives on Friday passed a budget plan for the next fiscal year that would cut federal spending by around $6 trillion over a decade and includes controversial long-term cuts to healthcare programs for the elderly and poor.

By a vote of 235-193, the Republican-controlled House passed the budget for fiscal 2012, which starts on October 1. It has been attacked by President Barack Obama and Democrats in Congress for cutting social programs while also reducing the tax burden for high-income earners.

The Senate is expected to unveil a much different budget plan in coming weeks.

Before Washington goes on their two-week Easter break, the House wants to vote on Rep. Paul Ryan’s 2012 Budget proposal that would cut $6 Trillion over the next ten years.

FoxNews | House to Vote on GOP 2012 Budget

With a fundamental restructuring of Medicare and Medicaid, the plan has been blasted by Democrats, including President Obama, as an attempt to leave seniors and poor holding the bag on health care costs. 

But Ryan, R-Wis., says the effort is an attempt to “preempt austerity” that will come by following the current budget route, which on its current trajectory adds $6.7 trillion to the deficit over the next 10 years. 

“What we’re trying to do here is keep the social compact,” Ryan told an audience in Washington on Thursday. “A limited government, free enterprise system, a government that lives within its means, a government (that) keeps its promises to the most vulnerable in our society, to the seniors in our society, but a government that continues the idea of America, the characteristics of America, equal opportunity, upward mobility, prosperity.”

According to Ryan’s plan, Medicare payments would no longer be paid by government sending out checks for medical bills, but would let people under age 55 choose among private insurance plans that the government would then supplement. People 55 and over would remain in the current system, but younger workers would receive subsidies that would steadily lose value over time. Ryan says those who can pay more will have to do so while lower income Americans will still be covered.

As it should come as no surprise, all that effort to cut more and save more over the budget battle, and it comes down to a numbers game. But the numbers will leave most on Captial Hill scratching their heads trying to get them to come out as promised. But, as Pelosi would probably put it, the bill should be passed so we can figure out what’s in it.

FoxNews | Ahead of Key Vote, Estimate Shows Budget Bill Saves Less Than Advertised

According to a Congressional Budget Office estimate, the hard-fought budget deal funding the government for the rest of the year saves only $352 million from non-war accounts this year. The new figure has rankled conservative lawmakers who thought they had extracted a fair amount of concessions out of the other side of the aisle. It wasn’t the $61 billion in cuts they had originally sought, but House Speaker John Boehner and his deputies insisted $38 billion in cuts was the best deal they could get, with the White House and Senate Majority Leader Harry Reid on the other side of the negotiating table. 

But the CBO analysis showed the savings mostly won’t materialize this year, potentially spelling trouble for the deal as it approaches a floor vote Thursday, though Boehner insists it’ll pass. 

About $8 billion in immediate cuts to domestic programs and foreign aid are offset by nearly equal increases in defense spending. When war funding is factored in the legislation would actually increase total federal outlays by $3.3 billion relative to current levels. 

To a fair degree, the lack of immediate budget-cutting punch is because the budget year is more than half over and that cuts in new spending authority typically are slow to register on deficit tallies. And Republicans promise that when fully implemented and repeated year after year, the cuts in the measure would reduce the deficit by $315 billion over the coming decade.