Obama to hold town hall meeting in Reno on budget

By Karoun Demirjian

Published Friday, April 15, 2011 | 11:47 a.m.

Updated Friday, April 15, 2011 | 1:06 p.m.

Congress is on break for the next two weeks, so the president is bringing the budget battle to Nevada.

Beginning Tuesday, President Obama will be making a three-day tour through northern Virginia, Palo Alto, Calif., and Reno to promote his plan to reduce the deficit by $4 trillion over the next 12 years, which he laid out the framework for in a speech this past Wednesday that focused on themes of “shared responsibility” and “shared prosperity.”

The format of Thursday’s event in Reno will be a town hall-style forum.

Obama is making these town hall stops in his capacity as the president. But now that his campaign for re-election is officially under way, it’s hard not to read a modicum of campaign politics into his public appearances -- especially in a state like Nevada, which is expected to be a key battleground for Obama in his efforts to keep his office, and to keep the Senate blue.

In an era of recession recovery and soaring deficits, both parties are betting that the budget will play big on the election circuit and scrambling to stake out the high ground with deficit-busting, pro-growth proposals.

The ink has barely dried on the deal to fund the federal government through fiscal 2011, but already the wrangling over fiscal 2012 is well under way.

The House was first out of the gate with a proposal for reducing spending in the next fiscal year, in the form of a budget from Republican Rep. Paul Ryan that projects a $6.2 trillion reduction in spending by 2030.

It’s a plan that’s been lauded by conservatives for its courage, and presented as necessary to “decrease government spending, create jobs and preserve Medicare for future generations while making no changes for current recipients,” according to Nevada Rep. Dean Heller, referencing the clause in Ryan’s proposal that ensures seniors 55 and over won’t face any changes.

“The federal government must stop spending money we don’t have,” he continued in a statement released Thursday. “The status quo leads to bigger government, higher taxes, less jobs, and rationed health care for our seniors.”

Democrats have objected to the budget because it does so by repealing Obama’s health care law, revamping Medicare into a subsidized voucher program, and converting Medicaid to block grants -- but doesn’t touch taxes.

That’s anathema to many Democrats, who along with the president, have been planning on curtailing the Bush-era tax cuts for wage earners of $250,000 or above once the compromise deal on tax policy struck during last year’s lame duck session runs out.

Obama’s deficit reduction proposal depends on curtailing those tax breaks, as well as making deeper reductions in mandatory defense spending, to reach his projected deficit reduction of $4 trillion over the next twelve years without drastically altering Medicaid and Medicare.

“Nevadans oppose the Republicans’ extreme budget because it ends Medicare and slashes Medicaid in order to protect wasteful taxpayer giveaways,” said Nevada Democratic Rep. Shelley Berkley. “Instead of protecting tax breaks for big oil and corporations that ship jobs overseas, we should be investing in creating clean energy jobs in Nevada, strengthening our economy and protecting Medicare, Medicaid and Social Security for Americans of all generations.”

If these issues -- health care, entitlements, spending and taxes -- are going to be what the parties duke it out over in the run-up to 2012, that goes double for Berkley and Heller. The two are all but assured to face off against each other in the race for the Senate seat occupied by Republican Sen. John Ensign, but for them, these issues aren’t just confined to the campaign trail: they’ll be slogging them out in genteel style in every hearing before the Ways and Means Committee, on which they both serve, when these issues arise.

And arise they will. While Ryan’s budget process has consolidated the Republicans’ deficit reduction agenda in a single document, Ways and Means has been working in parallel, and will likely have a stepped-up role to play designing changes to entitlement programs and the tax code, as Ryan’s House-cleared budget moves through negotiations and compromises with Democrats in the Senate and White House who despise it.

“The House budget is so unfair to many different people in our country ... it changes Medicare as we know it, and in fact turns it over to the insurance industry,” Senate Majority Leader Harry Reid said Thursday, recalling his own experience as a hospital board member in Clark County -- his first elected office -- before and after Medicare was introduced.

“I've seen the difference between having Medicare and not having it,” Reid said, adding Friday that “the Republican plan to end Medicare and immediately raise prescription drug costs for seniors in order to pay for millionaire tax breaks will never pass the Senate. The fact that it passed the House shows just how far to the right the Tea Party has dragged the Republican Party.”

Republicans say though that the Democrats’ concerns are overblown, and point the finger back across the aisle, charging that the Democrat-backed health care law, which the Ryan budget would repeal, strips half a trillion from Medicare that would be put back into the system under their proposal. They also point to calculations that show the country would be spending more overall on Medicaid in every successive year their plan is in place, while freeing up the states to make their own decisions.

But Democrats argue the Republicans’ top-line figures, which they also challenge the merits of, don’t matter if the money isn’t going to trickle down to the individual middle class Americans who are currently dependent on these services -- and they say it isn’t.

“[Republicans] want to give people like me a $200,000 tax cut that’s paid for by asking 33 seniors to each pay $6,000 dollars more in health care costs,” Obama said Wednesday when outlining the framework of his deficit plan, which doesn’t yet exist in legislative form. “It’s not right. It’s not going to happen as long as I’m president.”

Expect to hear more along those lines in Reno.