From The New York Times:
WASHINGTON — Congress has yet to settle its first budget fight of the year but is already about to move on to an even more consequential fiscal clash.
Even as the two parties struggled over the weekend to reach a deal on federal spending for the next six months and avert a government shutdown at the end of the week, House Republicans were completing a budget proposal for next year and beyond. It is likely to spur an ideological showdown over the size of government and the role of entitlement programs like Medicaid and Medicare.
The plan, which is scheduled to be unveiled Tuesday, will be the most ambitious Republican effort since the November elections to put a conservative stamp on economic and domestic policy.
The longer-term budget proposal has been led by Representative Paul D. Ryan [chairman of the Budget Committee], a Wisconsin Republican who is the party’s leading voice on budget matters, and will go beyond numbers to provide policy prescriptions.
It will call for deep spending cuts again in 2012, chart a path to reducing the deficit and slowing the growth of the accumulating national debt, and grapple with the politically volatile issue of reining in the cost of entitlement programs, starting with Medicaid, which provides health coverage for the poor.
The efforts of Mr. Ryan, backed by [John] Boehner and other Republican leaders, are certain to meet serious resistance from the Democratic-led Senate and from [President] Obama.
House Democrats, who are preparing an alternative budget, say the Republican approach would cut off aid to some of the neediest Americans and shortchange education programs vital to staying economically competitive.
“It seems to be the same old, same old,” said Representative Chris Van Hollen of Maryland, the senior Democrat on the Budget Committee. “It is going to be continued big tax breaks for millionaires and big corporate special interests like oil companies and deep cuts in education for kids and health care for seniors.”
Republicans have been urging Mr. Obama to seize the opportunity provided by a divided government and lead a legislative push to rein in spending on programs like Medicaid, Medicare and Social Security. Emboldened by their election wins and a sense that the public is ready for a new approach, House Republicans say they will push forward on their own and try to draw the president and Senate Democrats into a broader discussion about long-term deficit reduction and the soaring costs of the entitlement programs.
“You are going to see major reforms in Medicare and Medicaid; you are going to see a change in the deficit trajectory that is pretty dramatic,” said Representative Tom Cole, an Oklahoma Republican who is on the Budget Committee.
“Ryan isn’t touching the third rail,” Mr. Cole said, employing the expression used to suggest that messing with Social Security and Medicare can be politically fatal. “He is wrapping both hands around it.”
Any deal for the current fiscal year is likely to fall short of what the Tea Party movement and some other fiscal conservatives are demanding, but Republican leaders are already signaling that the big prize is a deep spending cut for next year and a start on reining in the entitlement programs — steps that could involve trillions of dollars over coming decades, as opposed to the tens of billions of dollars on the table in the budget battle for this year.
While Mr. Ryan and top Republican aides would not discuss specifics, there are strong indications that the proposal will draw on deficit reduction plans that Mr. Ryan laid out in his 2010 “roadmap plan” and a second proposal he wrote with Alice M. Rivlin, a director of the Office of Management and Budget in the Clinton administration.
In that plan, Ms. Rivlin and Mr. Ryan proposed that Medicaid financing be converted into a block grant program, with states given a set allotment of money and new discretion to shape health coverage programs for the poor. Their Medicare proposal would allow those nearing eligibility to remain with the current system, and it would create a program that would provide payments to Medicare enrollees to buy private health insurance.
Democrats said they intended to draw sharp distinctions between their approach and that of Republicans.
“The idea of block-granting and flexibility kind of sounds good, but it is actually code for cutting,” said Representative John Yarmuth, a Kentucky Democrat on the Budget Committee. “It is a license to cut.”