House Republicans Said to Seek Spending Cuts, Health Law Repeal


"A Pledge to America", House Republicans' new governing agenda, will champion tax cuts and health-care changes

(Updates with Pence Comments in Third, Fourth and Sixth Paragraphs.)

(Bloomberg) — House Republicans will announce a governing agenda today that would cut federal spending, extend expiring tax cuts and repeal the Democrats' health-care law,according to a draft provided by a party aide.

The program is to be released by party leaders at a hardware store in Sterling, Virginia, as Republicans make their case to voters to retake the House majority in the Nov. 2 elections.

The first priority, according to Representative Mike Pence of Indiana, is the extension of Bush-era tax cuts.

"It's the top of the list to get the economy moving again right now. There would be almost nothing more important that Congress could do right now," Pence said today onBloomberg Television, calling on House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid to take all of the proposals for extensions of 2001 and 2003 tax cuts to a vote.

Titled "A Pledge to America," the plan is patterned after House Republicans' "Contract with America" from 1994. Republicans unveiled the earlier plan six weeks before elections in which they gained the majority for the first time in 40 years. House Republican leader John Boehner of Ohio was an architect of the 1994 plan and the new version. Democrats regained the House majority in 2006.

"It's not the long-term platitudes and commitment of the past," Pence said. " These are very specific proposals that we believe, if passed, would take our national government in the direction the American people want it to go."

The plan includes a number of proposals previously offered by Republicans, including a permanent extension for all income levels of tax cuts enacted under former President George W. Bush.

It would repeal the Democrats' health-care law and replace it with longstanding Republican priorities such as controlling medical-malpractice costs, expanding health-savings accounts and allowing people to buy insurance policies across state lines. It would provide health coverage to the costliest Americans to insure by expanding high-risk pools and reinsurance programs.

Insurance Companies

"Under Republicans, insurance companies will once again be in charge of Americans' health care," House Majority Leader Steny Hoyer of Maryland said in an e-mailed statement. Republicans would make "a full accounting of Social Security, Medicare and Medicaid," according to the draft, which didn't give specifics.

Republicans also will seek to end government control of Fannie Mae and Freddie Mac and require them to establish a minimum capital standard. That would save as much as $30 billion, the plan said.

Small businesses would get a 20 percent tax deduction on their income, and the military prison in Guantanamo Bay, Cuba, would be kept open to hold suspected terrorists. According to the draft, Republicans want to roll back federal spending to "pre-stimulus, pre-bailout levels" and set spending caps for the future. They estimate this would save $100 billion in the first year. They also would impose a net hiring freeze on non-security federal employees. The plan didn't estimate how much money a hiring freeze would save.

Approval of New Rules

Anticipating a series of showdowns with President Barack Obama over health care and federal spending, Republicans propose requiring congressional approval of any federal regulation that would result in more than $100 million in new annual costs to the economy.

Some of the proposed rules changes echo complaints about the legislative process by Tea Party activists who favor lower taxes and limited government. Republicans want to establish a certification process to make sure all bills meet a constitutional standard. They also promise to act on one major legislative issue at a time instead of bundling them into a "must-pass" vehicle.

Obama has accused Republicans of not being serious about cutting the $1.34 trillion federal deficit because they back an extension of tax cuts for the wealthiest Americans that will cost about $700 billion over 10 years. Speaking last night at a Democratic fundraiser in New York, he said past Republican policies "turned record surpluses into record deficits."

Obama's Comments

"Republicans running for Congress, they want the next two years to look like the eight years before I ran for office," Obama said.

House Speaker Nancy Pelosi's spokesman, Nadeam Elshami, said in a statement the Republican plan would send jobs overseas, reduce patients' rights, boost the deficit by $700 billion to provide tax cuts for the wealthy, and "once again, subject American families to the recklessness of Wall Street."

Elshami said that after Republicans hold their event at a small business, they will be "racing back presumably to vote against the Small Business Jobs Act" scheduled for a final vote today. The plan offers a mix of tax cuts, loans and spending to ease the flow of credit to small businesses.

The 1994 "Contract With America" spelled out a 10-point legislative agenda. While the new Republican-controlled House passed nine of the measures, most, including a constitutional amendment requiring a balanced budget, failed to get Senate support.

The new plan would seek to save money by canceling unspent funds from the $814 economic stimulus plan enacted last year.

The White House called the idea of unspent stimulus funds a "myth" in an Aug. 11 website article by Chief Economic Adviser Jared Bernstein. He said 94 percent of the money is obligated through payments already made, promised tax cuts, or projects under contract. The remaining 6 percent has been awarded or soon will be, he wrote.


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