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Column: The GOP attack on the safety net and middle-class programs begins to take shape

Published

4 months ago

January 21, 2025

Column: The GOP attack on the safety net and middle-class programs begins to take shape

No one can be surprised that Republicans are hoping to exploit their Washington trifecta — the White House and majority control of the House and Senate — by implementing vast federal budget cuts in order to save their 2017 tax cuts from expiration.

Now we’re beginning to see some meat on the bare bones of GOP policies, thanks to a “menu” of fiscal policy reforms recently leaked to Politico.

The one-page document, which Politico reports was produced by the House Budget Committee chaired by Rep. Jodey Arrington (R-Texas), lists dozens of cutbacks adding up to supposed savings of as much as $5.7 trillion over 10 years.

We ought to be able to unleash growth through tax cuts … and we ought to be able to bend the spending curve.

— House Budget Committee Chair Jodey Arrington (R-Texas)

The primary near-term goal appears to be staving off the expiration next year of the 2017 tax cuts, which disproportionately benefited corporations and the wealthy.

Many of these proposals are vague, presumably deliberately, though the drafters surely know the details. The ideas tend to match proposals that have been advanced by congressional Republicans in the past, and include some that were implemented by the first Trump administration and reversed or dropped by the Biden White House.

The main targets, moreover, are programs that the GOP has advocated paring back or eliminating for years, such as Medicaid, the Affordable Care Act and food stamps. Cuts in some programs are described in the “menu” under misleading headings.

Proposals that would cut Medicaid benefits or eligibility for thousands of Americans are titled “Making Medicaid Work for the Most Vulnerable.” A sheaf of proposals to raise costs for Obamacare enrollees comes under the anodyne heading, “Reimagining the Affordable Care Act.”

Arrington hasn’t commented publicly on the leaked document. His committee hasn’t responded to my request for comment. But he has made his name as a budget hawk: “We ought to be able to unleash growth through tax cuts,” he told the Wall Street Journal after the November election, “and we ought to be able to bend the spending curve.”

How many of these proposals can actually be enacted by the current Congress is unclear, since the GOP majority is narrow in the Senate and razor-thin in the House. Some proposals could hit hard in states and districts represented by Republicans. But the theme of the proposals is unmistakable — safety net programs and several Biden initiatives are on the chopping block.

Let’s examine some of the lowlights:

—Medicaid: Hostility to this federal-state program, which provides healthcare for low-income households, is a Republican hobbyhorse.

The proposal would change Medicaid into a block-grant program that provides federal assistance to states based on their population. As I’ve reported in the past — including when Trump proposed the change during his first campaign for office — block grants are just budget cuts in disguise. They’re invariably aimed at antipoverty programs.

Block-granting Medicaid would sap states’ ability to respond to changing conditions driving up healthcare spending, such as the COVID pandemic. The committee asserts that this change would yield as much as $918 billion in savings over 10 years. That’s the equivalent of about 15% of the federal share of Medicaid spending — potentially a major hit to state budgets.

The committee also advocates paring back the federal share of Medicaid spending on enrollees signed up under the ACA’s Medicaid expansion, which brought childless low-income adults into the program, to the percentage paid under traditional Medicaid. The ACA set the federal share for Medicaid expansion at 90% of costs.

The federal share in traditional Medicaid averages about 69% but varies by state, from a minimum of about 60% to a maximum of 83%. So this change, which the committee pegs at a 10-year savings of $690 billion, would place a further strain on state budgets. The proposal also would reduce the federal share of Medicaid administrative expenses, set by law at no less than 50%.

The committee also advocates imposing work requirements on Medicaid recipients. It claims that this would save $120 billion over a decade, but that could be achieved only by throwing thousands of enrollees out of the program. We know this because that’s exactly what happened when Arkansas tried it during the first Trump term.

The work rules did nothing to reduce joblessness, exacerbated a healthcare crisis, and raised administrative costs for the state. The Arkansas program was overturned by a federal judge, who also blocked other red states from proceeding. The Republican love for this policy despite ample evidence of its failure remains a mystery.

—Public assistance: Republican attacks on the most economically vulnerable Americans continue apace. The committee proposes reducing federal spending on Temporary Assistance for Needy Families (TANF), the federal-state program generally described as “welfare,” by 10%, to produce $15 billion in savings over a decade.

This is nothing but a cruel hit on America’s most desperate households. In no state do TANF benefits reach even 60% of the poverty level for a family of three. In 17 states — mostly those with large Black populations — they’re below 20% of the poverty level. In all but 11 states including California, according to the Center on Budget and Policy Priorities, TANF benefits were eroded by inflation between 1996 and 2023, sometimes by more than half.

A related proposal would reinstate the tightened standards for the “public charge” rule instituted in the first Trump term. This malevolent policy was aimed at immigrants by denying them entry or improvement in their immigration status if they were thought likely to access public assistance programs.

Trump added Medicaid and other noncash programs to the traditional roster of cash programs such as food stamps as signs the recipients would become a public charge.

As then-California Atty. Gen. Xavier Becerra noted at the time, the change was designed not only to throw millions of people out of public assistance programs, but also to have a chilling effect that would keep people who need healthcare and other help from seeking it. The Trump rule succeeded in doing so, according to an analysis by KFF; it was rescinded by Biden.

The menu lists “SNAP reforms” as the source of $22 billion in savings over a decade. It doesn’t specify the “reforms” sought in the food stmp program, but simple math suggests that they would involve either throwing people out of the program or reducing benefits, which currently average $6-$7 a day per person.

—The Biden Agenda: Other elements of the GOP menu take aim at key initiatives passed under Biden, including many that had bipartisan support.

It proposes dropping the green-energy provisions of the 2021 infrastructure bill, which included funding to modernize the nation’s public transit systems, building a national network of electric vehicle chargers and converting thousands of school buses to electric energy. The committee claims this would save $300 billion over 10 years, but since much of this spending is going to red states and conservative districts, rescinding it might be a tough lift for the GOP.

—The coming emergencies: The committee proposes to place restrictions on emergency spending — limiting the spending to the “recent average” to produce $500 billion in savings over a decade. This sounds like the elevation of hope over reality, since recent emergencies include not only the California fires, but tropical storms that leveled whole communities from Florida and Louisiana to Tennessee, North Carolina and Pennsylvania last year. Mother Nature, plainly, doesn’t pay much attention to budgetary posturing. Global warming is likely to raise the cost of emergency relief, not reduce it.

Politics as well as natural conditions will get in the way of these policies’ implementation. But it’s worth knowing what the Republicans aspire to achieve, and assessing their intentions.

Business

Delaying Medicare enrollment. What to know

Published

11 hours ago

May 31, 2025

Press Room

Delaying Medicare enrollment. What to know

Dear Liz: When my husband was approaching 65, he was employed and covered by a high-deductible healthcare plan with a health savings account by his employer. Neither his employer nor our local Social Security office had concrete advice on how to proceed about enrolling in Medicare, but after tremendous research, he eventually delayed enrollment. Now I am approaching 65. My husband is still working, and I am still covered by his health insurance, although both are in his name. Do I enroll in Medicare at the appropriate time or do I delay enrollment like he did?

Answer: Delaying Medicare enrollment can result in penalties that can increase your premiums for life. If you or a spouse is still working for an employer with 20 or more employees, however, generally you can opt to keep the employer-provided health insurance and delay applying for Medicare without being penalized. If you lose the coverage or employment ends, you’ll have eight months to sign up before being penalized.

Delaying your Medicare enrollment also allows your husband to continue making contributions on your behalf to his health savings account. In 2025, the HSA contribution limit is $4,300 for self-only coverage and $8,550 for family coverage, plus a $1,000 catch-up contribution for account holders 55 and older. Once you enroll in Medicare, HSA contributions are no longer allowed.

Medicare itself suggests reaching out to the employer’s benefits department to confirm you are appropriately covered and can delay your application. Let’s hope that by now your employer’s human resources department has gotten up to speed on this important topic.

Dear Liz: We read your recent column about capital gains and home sales. Our understanding is that if you sell and then buy a property of equal or greater value within the 180-day window, the basis for tax purposes is the purchase price, plus the $500,000 exemption, plus the improvements to the property, minus the depreciation, whatever that number comes to, and then the profit above that has to be reinvested or it is subject to capital gains. We talked to our CPA about this and he referred us to a site that specializes in 1031 exchanges.

Answer: You’ve mashed together two different sets of tax laws.

Only the sale of your primary residence will qualify for the home sale exemption, which for a married couple can exempt as much as $500,000 of home sale profits from taxation. You must have owned and lived in the home at least two of the previous five years.

Meanwhile, 1031 exchanges allow you to defer capital gains on investment property, such as commercial or rental real estate, as long as you purchase a similar property within 180 days (and follow a bunch of other rules). The replacement property doesn’t have to be more expensive, but if it’s less expensive or has a smaller mortgage than the property you sell, you could owe capital gains taxes on the difference.

It is possible to use both tax laws on the same property, but not simultaneously.

In the past, you could do a 1031 exchange and then convert the rental property into a primary residence to claim the home sale exemption after two years. Current tax law requires waiting at least five years after a 1031 exchange before a home sale exemption can be taken.

You can turn your primary residence into a rental and after two years do a 1031 exchange, but you would be deferring capital gains, while the home sale exemption allows you to avoid them on up to $500,000 of home sale profits.

Liz Weston, Certified Financial Planner, is a personal finance columnist. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the “Contact” form at asklizweston.com.

Business

LinkedIn cuts 281 workers in California as tech layoffs continue

Published

1 day ago

May 31, 2025

Press Room

LinkedIn cuts 281 workers in California as tech layoffs continue

LinkedIn, the professional social network where people search for work, is shedding jobs.

The Microsoft-owned tech company has cut 281 workers in California, a notice filed this week to the California Employment Development Department shows.

Earlier this month, Microsoft said that it was terminating 3% of staff, or about 6,000 workers. The layoffs affected its California employees and LinkedIn workers.

LinkedIn is among major tech companies that have slashed their workforces this year. Meta, Google, Autodesk and other tech companies have also been cutting workers, citing various reasons, including restructuring, investments in artificial intelligence and low worker performance.

LinkedIn, headquartered in Sunnyvale and Mountain View, notified its employees about the layoffs on May 13. Workers posted about their pink slips on the social network, letting hiring managers and recruiters know that they were open to work.

The company didn’t respond to a request for comment. Its website says it has roughly 18,400 employees and offices in more than 30 cities globally.

LinkedIn’s California layoffs affected workers at its offices in San Francisco, Mountain View, Carpinteria and Sunnyvale. More than half of those cuts hit its workforce in Mountain View.

Software engineers were heavily impacted by LinkedIn’s California layoffs, according to data provided to the state. Talent account directors, senior product managers and other workers also lost their jobs.

The cuts come as tech companies are releasing more artificial intelligence-powered tools that can generate code. Executives have also said that would impact engineering jobs.

Microsoft Chief Executive Satya Nadella said in April that as much as 30% of the company’s code is written by AI. Nadella spoke during a conversation with Meta Chief Executive Mark Zuckerberg at the social network’s AI developer conference.

As Microsoft competes to release more AI tools, the company has said that it’s trying to increase how fast it moves by reducing the number of managers and cutting down on redundancies.

It’s the latest cost-cutting round at LinkedIn. In 2023, the company laid off nearly 700 employees and said that it was trying to improve agility and accountability as part of a reorganization effort.

Microsoft purchased LinkedIn for $26 billion in 2016. In April, the company reported that its revenue in the third fiscal year quarter reached $4.3 billion in the third fiscal year quarter, up 7% over last year.

Business

FCC commissioner sounds alarms about free speech 'chilling effect' under Trump

Published

2 days ago

May 30, 2025

Press Room

FCC commissioner sounds alarms about free speech 'chilling effect' under Trump

Federal Communications Commissioner Anna M. Gomez traveled to Los Angeles this week to sound an alarm that attacks on the media by President Trump and his lieutenants could fray the fabric of the 1st Amendment.

Gomez’s appearance Wednesday at Cal State L.A. was designed to take feedback from community members about the changed media atmosphere since Trump returned to office. The president initially expelled Associated Press journalists from the White House, for example. He signed an executive order demanding government funding be cut to PBS and NPR stations.

Should that order take effect, Pasadena-based radio station LAist would lose nearly $1.7 million — or about 4% of its annual budget, according to Alejandra Santamaria, chief executive of parent organization Southern California Public Radio.

“The point of all these actions is to chill speech,” Gomez told the small crowd. “We all need to understand what is happening and we need people to speak up and push back.”

Congress in the 1930s designed the FCC as an independent body, she said, rather than one beholden to the president.

But those lines have blurred. In the closing days of last fall’s presidential campaign, Trump sued CBS and “60 Minutes” over edits to an interview with then-Vice President Kamala Harris, alleging producers doctored the broadcast to enhance her election chances. CBS has denied the allegations and the raw footage showed Harris was accurately quoted.

Trump-appointed FCC Chairman Brendan Carr, upon taking office in January, revived three complaints of bias against ABC, NBC and CBS, including one alleging the “60 Minutes” edits had violated rules against news distortion. He demanded that CBS release the unedited footage.

The FCC’s review of Skydance Media’s pending takeover of CBS-parent Paramount Global has been clouded by the president’s $20-billion lawsuit against CBS. The president rejected Paramount’s offer to settle for $15 million, according to the Wall Street Journal, which said Trump has demanded more.

Two high-level CBS News executives involved in “60 Minutes” were forced out this spring.

Gomez, in an interview, declined to discuss the FCC’s review of the Skydance-Paramount deal beyond saying: “It would be entirely inappropriate to consider the complaint against the ’60 Minutes’ segment as part of a transaction review.” Scrutinizing edits to a national newscast “are not part of the public interest analysis that the commission does when it considers mergers and acquisitions,” she said.

For months, Gomez has been the lone voice of dissent at the FCC. Next month, she will become the sole Democrat on the panel.

The longtime communications attorney, who was appointed to the commission in 2023 by former President Biden, has openly challenged her colleague Carr and his policies that align with Trump’s directives. She maintains that some of Carr’s proposals, including opening investigations into diversity and inclusion policies at Walt Disney Co. and Comcast, go beyond the scope of the FCC, which is designed to regulate radio and TV stations and others that use the public airwaves.

The pressure campaign is working, Gomez said.

“When you see corporate parents of news providers … telling their broadcasters to tone down their criticisms of this administration, or to push out the executive producer of ’60 Minutes’ or the head of [CBS] News because of concerns about retribution from this administration because of corporate transactions — that is a chilling effect,” Gomez said.

Wednesday’s forum, organized by the nonprofit advocacy group Free Press, was punctuated with pleas from professors, journalists and community advocates for help in fending off Trump’s attacks. One journalist said she lost her job this spring at Voice of America after Trump took aim at the organization, which was founded more than 80 years ago to counter Nazi propaganda during World War II.

The Voice of America’s remaining staffers could receive reduction-in-force notices later this week, according to Politico.

Latino journalists spoke about the difficulty of covering some stories because people have been frightened into silence due to the administration’s immigration crackdown.

For now, journalists are able to carry out their missions “for the most part,” said Gabriel Lerner, editor emeritus of the Spanish-language La Opinión.

But he added a warning.

“Many think that America is so exceptional that you don’t have to do anything because fascism will never happen here,” Lerner said. “I compare that with those who dance on the Titanic thinking it will never sink.”

The White House pushed back on such narratives:

“President Trump is leading the most transparent administration in history. He regularly takes questions from the media, communicates directly to the public, and signed an Executive Order to protect free speech on his first day back in office,” spokesperson Anna Kelly said. “He will continue to fight against censorship while evaluating all federal spending to identify waste, fraud, and abuse.”

FCC Commission Chairman Brendan Carr on Capitol Hill.

(Alex Wroblewski / Bloomberg via Getty Images)

Traditionally, the five-member FCC has maintained an ideological balance with three commissioners from the party in power and two from the minority. But the senior Democrat — Geoffrey Starks — plans to step down next month, which will leave just three commissioners: Gomez, Carr and another Republican, Nathan Simington.

Trump has nominated a third Republican, Olivia Trusty, but the Senate has not confirmed her appointment.

Trump has not named a Democrat to replace Starks.

Some on Wednesday expressed concern that Gomez’s five-year tenure on the commission could be cut short. Trump has fired Democrats from other independent bodies, including the Federal Trade Commission and the Consumer Product Safety Commission.

Gomez said if she is pushed out, it would only be because she was doing her job, which she said was defending the Constitution.

Rep. Raul Ruiz (D-Indio) applauded Gomez’s efforts and noted that he’s long appreciated coordinating with her on more routine FCC matters, such as ensuring wider broadband internet access.

“But now the fight is the survival of the free press,” Ruiz said.

He noted that millions of people now get news from non-journalist sources, leading to a rise of misinformation and confusion.

“What is the truth?” Ruiz said. “How can we begin to have a debate? How can we begin to create policy on problems when we can’t even agree on what reality is?”