Trump Asks for Billions More in Emergency Border Funds

Plus, 3 reasons a gas tax isn't the answer on infrastructure

Trump Asks Congress for $4.5 Billion in Emergency Border Funds

The Trump White House on Wednesday asked Congress for $4.5 billion in emergency border funding, warning that the Department of Homeland Security is at risk of running out of money to deal with a developing “humanitarian and security crisis” resulting from a surge in migrants.

“The situation becomes more dire each day. The migration flow and the resulting humanitarian crisis is rapidly overwhelming the ability of the Federal Government to respond,” White House acting budget director Russ Vought wrote in the request, according to The Washington Post.

The $4.5 billion request includes $3.3 billion for humanitarian assistance such as increased shelter capacity and money to feed and care for migrants, the White House said in a fact sheet. It also includes $1.1 billion for border operations like additional personnel and detention beds. None of the additional fund requested would go toward building the president’s desired border wall.

The emergency funding would be in addition to the $8.6 billion in border barrier money that Trump is requesting in his 2020 budget, as well as the $6.6 billion he sought to secure for wall construction by redirecting other funds and declaring a national emergency at the border, The Washington Post reports.

Democrats greeted the request with some skepticism. "The Trump administration appears to want much of this $4.5 billion emergency supplemental request to double down on cruel and ill-conceived policies," said Rep. Nita Lowey (D-NY), who chairs the House Appropriations Committee. "We will carefully review the request in its totality and, where possible, work with the Senate and the White House to make conditions at the border more humane.”

Switch to Medicare for All Would Be ‘Complicated and Potentially Disruptive’: CBO

Transitioning the United States to a single-payer health care system “could be complicated, challenging, and potentially disruptive,” the Congressional Budget Office said Wednesday in a new report looking at the considerations involved in making such a switch. The transition could be eased by phasing in the biggest changes gradually to minimize their impact, the report says.

CBO did not assess any specific Medicare for All proposal or provide a cost estimate for a potential switch to a single-payer system. It noted that shifting from the current mix of private and public health care spending, which totaled $3.5 trillion in 2017, to a single-payer system “would significantly increase government spending and require substantial additional government resources.” Just how substantial those resources would need to be would depend on the specifics of the system and whether or not policymakers decided to increase annual budget deficits.

“Total national health care spending under a single-payer system might be higher or lower than under the current system depending on the key features of the new system, such as the services covered, the provider payment rates, and patient cost-sharing requirements,” the report says.

Overall, though, the highly anticipated report may be more notable for the host of questions it raises about a potential transition that it describes as “a major undertaking that would involve substantial changes in the sources and extent of coverage, provider payment rates, and financing methods of health care in the United States.”

The key questions CBO laid out for policymakers include:

  • How would the government administer a single-payer health plan?
  • Who would be eligible for the plan, and what benefits would it cover?
  • What cost sharing, if any, would the plan require?
  • What role, if any, would private insurance and other public programs have?
  • Which providers would be allowed to participate, and who would own the hospitals and employ the providers?
  • How would the single-payer system set provider payment rates and purchase prescription drugs?
  • How would the single-payer system contain health care costs?
  • How would the system be financed?

Rep. John Yarmuth (D-KY), who requested the CBO report, said Wednesday he hoped it would help speed the adoption of a single-payer system. “The fact remains that we have made immense progress in the past ten years, yet access to quality and affordable health care is still too often out of reach for families and hardworking Americans across the country,” Yarmuth said in an emailed statement. “We must do more, which is why I believe it is no longer a matter of if we will have a single-payer health care system in our country, but when. I hope this report and upcoming hearings help advance that timeline.”

But Republicans are certain to find ammunition in the report for their criticisms of a single-payer system. Rep. Steve Womack (R-AR), the ranking member of the House Budget Committee said in a statement: “While Democrats avoided asking questions they don’t want the answers to, including how much Medicare-for-All will cost the American people, the report CBO released today illuminates several consequences of Democrats’ one-size-fits-all health care approach, such as higher premiums, out-of-pocket expenses, and taxes.”

Chart of the Day: Medicare’s Specialty Drug Costs

“There's been an explosion in spending on specialty drugs within Medicare's prescription drug benefit over the past decade, and it may be warping insurers' incentives to keep overall costs down,” Axios’s Caitlin Owens writes.

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How to Pay for Infrastructure? 3 Reasons a Gas Tax Probably Isn’t the Answer

Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) announced Monday that President Donald Trump has agreed to pursue a massive infrastructure deal worth upwards of $2 trillion over 25 years. Democratic leaders will meet with the president again in three weeks to discuss how to pay for such a plan, with the White House on the hook for generating financing proposals.

“The ball is in their court,” Schumer said Monday after meeting with the president. “We told him that, it was repeated over and over again, that unless he is willing to come up with the pay-fors for this large package, it will never get done, and he agreed.”

Where can the White House turn for revenues to help fund such a massive infrastructure plan? Bloomberg’s Laura Davison and Mark Niquette say that the gas tax is one obvious place to look. The tax hasn’t been raised since 1993, leaving the U.S. with some of the lowest fuel taxes in the developed world — 18.4 cents per gallon of gasoline and 24.4 cents per gallon of diesel. But raising the tax won’t be easy. Here’s why:

1. The gas tax is politically fraught: Federal fuel taxes have remained frozen largely because U.S. lawmakers see any increase as a surefire political loser. The gas tax is regressive, hitting low-income households the hardest, and politicians on both the left and the right have expressed concerns about imposing new taxes on working-class voters. The opposition to a fuel tax hike has created some strange bedfellows, Davison and Niquette say, including Senator Elizabeth Warren (D-MA) on the left and various members of the House Freedom Caucus on the right.

Although the president’s backing could make a big difference —Rep. Chris Collins (R-NY), a Trump supporter, spoke in favor of doubling the gas tax this week — the dealmaking will be a challenge. Schumer said he would consider a gas tax hike only if Trump agreed to roll back some of the 2017 tax cuts as well. Senate Majority Leader Mitch McConnell called that approach “a non-starter.”

2. It won’t raise enough money. The federal fuel tax generated about $36 billion in revenues in 2016. Raising the tax by 25 cents a gallon would more than double the revenue, bringing in another $394 billion over 10 years, according to an analysis by the U.S. Chamber of Commerce, which supports the idea. The Tax Foundation is less optimistic, finding that a 50 cent per gallon increase would generate about $306 billion over a decade.

Either way, the increased revenue falls well short of what Pelosi, Schumer and Trump are contemplating for infrastructure. And the Highway Trust Fund, which is already in the red, would likely siphon off some of that money for ongoing maintenance, leaving less available for new projects. To top it off, there are legal restrictions on the kinds of projects fuel taxes can be used to pay for.

3. There are competing alternatives. Taxing fuel may be losing some of its appeal as electric vehicles become more prevalent. Rep. Mario Diaz-Balart (R-FL) spoke out against a fuel tax hike Tuesday: “I don’t think that is the way forward. The Highway Trust Fund is deficient because of a change in technology. We have more efficient automobiles, electric automobiles, we have hybrids — that’s not going to change.”

Rep. Chris Pappas (D-NH), who sits on the Transportation and Infrastructure Committee, called for a tax based on mileage driven rather than fuel consumed. "I think longer term — in terms of funding our roads and bridges, we all agree that vehicle miles traveled is a great way to look for revenue, we’re all driving more fuel-efficient vehicles and so the gas tax has less and less purchasing power," Pappas told The Hill Tuesday.

However, a new tax based on use rather than fuel consumption is still years away, experts say. So lawmakers may find themselves without a viable option for raising revenues, stuck between the existing fuel tax that’s too difficult to increase and a use-based tax that cannot yet be implemented.

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