WASHINGTON (CN) - Former Tea Party congressman Mick Mulvaney testified Tuesday that he probably would not vote for President Trump’s $4.4 trillion proposal but that he stands by it as a member of the Trump administration.
"I'm the director of the Office of Management and Budget," Mulvaney told the Senate Budget Committee. "My job is to try and fund the president's priorities, which is exactly what we did.”
A former congressman who ascended to the Trump cabinet after representing South Carolina for seven years, Mulvaney was frank about the budget’s shortcomings.
"It doesn't balance within the 10-year window," said Mulvaney, the sole witness at Tuesday’s hearing.
Despite $3 trillion in cuts to food stamps, Medicaid, Medicare and other social programs, lost tax revenue and higher military spending in Trump’s budget is predicted to cause a $7 trillion deficit in the next decade.
Mulvaney noted that the tax overhaul could add nearly $1 trillion to the deficit next year alone. But that figure doesn't account for the two-year bipartisan deal Congress reached last week, which adds $500 billion in spending.
The actual deficit could thus be closer to $1.2 trillion, Mulvaney acknowledged.
Echoing the rhetoric of many of his Democratic colleagues, Vermont Sen. Bernie Sanders said the proposal shows that Trump is compensating for the Republican tax overhaul passed last year at the expense of government programs on which low-income Americans rely.
"If you were wondering how President Trump plans to pay for his massive tax cuts to millionaires, billionaires and large corporations, this budget answers that question for you," Sanders said. "By breaking his campaign pledge not to cut Medicare, Medicaid and Social Security."
While most presidential budgets are rarely acted upon as written, and there is little appetite in Congress to make drastic cuts to safety-net programs, they nonetheless outline an administration's priorities. Mulvaney drove this point home during Tuesday morning's hearing when he called the proposal a "messaging document."
Sen. Patty Murray, a Washington Democrat, asked Mulvaney to promise he would not cut a single penny from Medicare to pay for the Republican tax overhaul.
Mulvaney responded: "That's exactly what this budget reflects."
Though Murray zeroed in on $500 billion in proposed cuts to the program, Mulvaney denied her interpretation.
"That's just not right," Mulvaney said. "The number is $236 billion and most of that is tied up in drug reforms and some other proposals."
Murray pressed him to explain the proposed Medicare cuts.
"We do not propose any changes to any benefit – any benefits – any services to beneficiaries. We try to focus on lowering drug prices within Medicare," he said.
Mulvaney added that the Social Security proposals contained in the 2019 budget proposal do not touch old-age retirement or core Social Security benefits.
"We tried to address some reforms within Social Security disability insurance," he said.
Mulvaney added that the budget proposal would move payments from the Medicare trust fund that cover graduate tuition for medical students and bad debts for non-Medicare patients at hospitals to another part of the budget.
"We actually still pay those but we don't pay them out of the trust fund," Mulvaney said. "And a lot of folks said that's a cut to Medicare. No it's not. It's actually improving the Medicare trust fund."
The budget request would allocate $716 for defense spending, $18 billion to construct a border wall, and more than $3 billion for immigration items, including more officers for the Border Patrol and Immigration and Customs Enforcement agencies, 52,000 additional detention beds, and another 75 immigration judges.
The 2019 budget proposal also revives calls for former President Obama's federal health care law to be repealed and replaced with a proposal put forth last year by Sens. Lindsey Graham, Bill Cassidy, Ron Johnson and Dean Heller. The bill would replace the Patient Protection and Affordable Care Act with a series of block grants doled out to states.
While the Congressional Budget Office estimated that the plan would lead to $215 billion in spending cuts over a decade, it also estimated that 20 million fewer Americans would have health insurance by 2026 if enacted.
During a back-and-forth with Graham, Mulvaney said he supports the plan because it gives control over health care spending to states, which he said are best suited to make decisions about how to provide health care to their residents.
"It is by far the best idea we've seen come down the pike in a long time," Mulvaney said.
The 2019 funding bill assumes that the Graham-Cassidy bill will pass, Mulvaney added.
Analysis of the bill by Avalere found that it would eliminate the Medicaid-expansion programs, while fundamentally changing the financing structure of the program.
Rather than a federal match for Medicaid spending, states would receive a fixed amount of money to spend on health care in a block grant, which could leave some states with less funding to subsidize health coverage for lower-income Americans.
Sanders noted during his testimony that two thirds of nursing home care is covered by Medicaid, and asked Mulvaney what would happen to those covered by the program under steep funding cuts.
"Think about it - people now in nursing homes with Alzheimer's, serious illnesses," Sanders said. "What happens to them, what happens to their families?”
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