Congress May Cut More Medicaid, Medicare Benefits

Article excerpt

What is an onlooker to make of the unremitting mix of gloomy and euphoric economic forecasts wafting through the land like imported perfume at one moment and the aromatic calling card of a disturbed skunk at the next?

For Congress, which returns officially to work this week after the annual holiday reconnoitering of home districts, the easy path - perhaps the right path - is to surrender to confusion and do nothing that might invite a worse disaster.

Given the current state of affairs, it seems all too likely that lawmakers will be sorely tempted to peel back still more from benefits manadated under Medicaid and Medicare, the government's two largest health care programs, as they search again for ways to reduce the mountainous budget deficits.

Medicaid is a nice round target, easy to hit, because the poor, whom it serves, have few defenders and even fewer advocates. Medicare, the strictly federal health plan for the elderly, can be replenished by reaching into the pockets of its constituents.

If the economy is indeed lowering itself toward a recession as a few economists are predicting, is the correct antidote a tax cut, or a tax increase putting the government nearer a pay-as-you-go policy , or would it be better to continue the heavy borrowing of recent years? Congress might well opt for the latter because the more government borrows, it appears, the better the economy performs.

It's possible, but the scary outlook could act as a restraining hand on many members of Congress. A more likely scenario, therefore, would seem to be another round of domestic trimming coupled with more borrowing.

The unknown cipher, however, is Sen. Daniel Patrick Moynihan's January surprise. Moynihan, D-N.Y., dropped a hand gerenade in the corridors the other day with his proposal to cut Social Security payroll taxes, an idea already embraced by large segments of business and labor. …