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White House raps Congress on budget stalemate

By Andrew Taylor

Associated Press

Published: Tuesday, April 5 2011 9:26 a.m. MDT

Ryan's program also includes a controversial proposal to convert the traditional Medicare program for the aged into a system by which private insurers would operate plans approved by the federal government.

Current Medicare beneficiaries or workers age 55 and older would stay in the existing system.

At the same time, Republicans propose to sharply cut projected spending on the Medicaid state-federal health program for the poor and disabled and transform it into a block grant program that gives governors far less money than under current estimates, but considerably more flexibility.

GOP officials requiring anonymity to discuss the budget before its release Tuesday said more than $1 trillion in savings would come from Medicaid.

Spending on hundreds of domestic programs — the accounts at the heart of the talks to avoid a government shutdown — would be returned to levels at or below those in effect in 2008, producing savings of hundreds of billions of dollars.

Ryan's goal for tax reform calls for a top tax rate of 25 percent for both individuals and corporations, down from the current top rate of 35 percent for both. That would mirror a proposal by Rep. Dave Camp, R-Mich., chairman of the tax-writing House Ways and Means Committee. Ryan embraces the popular goal of simplifying the tax code.

However, Republicans on Monday disclosed plans to instruct lawmakers "on how the House would operate in the event Senate Democrats shut down the government." And the Obama administration advised government agencies to take the proper steps to prepare for a shutdown.

In a memo to agency officials, the deputy director of the Office of Management and Budget, Jeffrey Zients, urged agency heads to refine and update contingency plans in the event negotiators don't strike a deal by Friday's deadline. The memo was first reported by The Washington Post.

Boehner's one-week measure that cuts an additional $12 billion could reassure tea party-backed lawmakers who are among the most vocal in seeking to reduce the size and scope of the government. It could also put pressure on Democrats and the White House to offer greater spending cuts.

But there's no visible movement on an impasse over GOP policy riders attacking Obama's health care and financial reform laws, cutting taxpayer funds to Planned Parenthood and reversing a host of Obama's environmental policies.

Under the decidedly arcane congressional budget process, the GOP plan is not actual legislation but provides a nonbinding, theoretical framework for future actions of Congress.

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