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Office of the Press Secretary

For Immediate Release May 8, 1995
                       AND MAJORITY LEADER DOLE.

May 8, 1995

The Honorable Robert Dole
Majority Leader
United States Senate
Washington, D.C. 20510

Dear Mr. Leader:

This week both the House and Senate Budget Committees are reported to be laying down budget plans that include Medicare cuts totalling between $250-$300 billion. As the President stated at the White House Conference on Aging, while the status quo is not acceptable, we also must make sure that we are dealing with Medicare and the Medicare Trust Fund in the right way. The right way to address such health care issues is to ensure that the steps we are taking not only control costs but also expand coverage, preserve choice, and ensure quality and affordable health care for our people.

The wrong way, as the President stated, is to use Medicare and Medicaid as a bank to pay for tax cuts for well-off Americans. Regardless of what budget or accounting devices are used, it is clear that current proposals would mean that Medicare and long-term care are being cut dramatically in order to ensure that there are enough savings to fund a huge tax cut. It is unwise and unfair to ask senior citizens to bear the largest cuts in history in Medicare and long-term care in order to free up funds for a tax cut for our most well-off Americans. How could we justify asking hundreds of thousands of families to lose their long- term coverage and tens of millions of seniors to pay thousands more in out-of-pocket costs at the same time we give the top one percent a $20,000 tax cut and allow major corporations to pay no tax whatsoever?

The only way to guarantee that historic cuts in Medicare and Medicaid are not funding tax cuts for the wealthy is to drop such tax cuts now, clearly and unequivocally. Only when you have proposed and passed a specific budget that explicitly rules out tax cuts for the wealthy and ensures that health care savings are part of a sensible overall health reform effort that works for everyone, can we start the vital discussion of how to secure health care and responsible deficit reduction for the future.


                         Leon E. Panetta
                         Chief of Staff