Obama Pledges $15b for Medicaid, Answers Critics

WASHINGTON (AP) -- President Barack Obama promised quick help for strapped Medicaid programs Monday as he brought in advisers and adversaries to discuss keeping entitlement programs from exploding the federal deficit.
Obama's summit at the White House, which was coming at close of a three-day meeting of the nation's governors, was the first such forum of his young presidency designed specifically to get at problems threatening the long-term fiscal health of the nation. It came as Obama gets ready to disclose ambitious plans to slash the federal deficit in half within four years.
Even before it began, some of its 130 invited White House conference participants cautioned against overinflated expectations.
"It can either be a nice press event. Or it can be a substantive event," said Republican Sen. Judd Gregg, whom Obama appointed as commerce secretary before the New Hampshire lawmaker balked. "History tells us it will be the first. We've had these meetings before. There's always a lot of people willing to point out the problem.''
Yet, he said, there is seldom anyone willing to make the difficult decisions to solve those problems.
As the nation's economy continues its downward spiral, Obama's advisers are keeping their focus on the broader fiscal troubles that have sent millions to unemployment rolls. Taken in context, the summit is but one part of the White House's larger approach to the coming weeks focused on Obama's priorities for a first term, including a State of the Union-style address on Tuesday.
That speech is not likely to include plans to deal with long-crumbling entitlement programs.
Obama's first order of business on the domestic front Monday was his East Room talk to the governors about the stimulus program -- and an unmistakable warning to critics of the $787 billion plan.
Obama revealed that his administration will release $15 billion Wednesday to help governors meet Medicaid payments to poor Americans. And he took the opportunity, as well, to address concerns about the stimulus plan raised by a handful of Republican governors who have called the plan overly large and wasteful.
At issue is a proposed expansion of state unemployment benefits for part-time workers and others who where previously ineligible to receive the funding. Some GOP governors -- several with an eye on the 2012 presidential contest including Mark Sanford of South Carolina and Bobby Jindal of Louisiana -- say they may not accept that funding because it will require a tax increase on employers once the stimulus money runs out.
Obama addressed that critique directly, and warned against allowing political considerations to cloud a discussion of the stimulus program.
"I think there are some very legitimate concerns on the part of some about the sustainability of expanding unemployment insurance. What hasn't been noted is that that is $7 billion of a $787 billion program. And it's not even the majority of the expansion of unemployment insurance,'' Obama said.
He added, "If we agree on 90 percent of this stuff, and we're spending all our time on television arguing about 1, 2, 3 percent of the spending in this thing, and somehow it's being characterized in broad brush as wasteful spending, that starts sounding more like politics. And that's what right now we don't have time to do.''
On the larger question of burgeoning deficits, Senate Republican Leader Mitch McConnell of Kentucky said that a solution exists in legislation written by Gregg and his Democratic counterpart on the Budget Committee, Sen. Kent Conrad of North Dakota.
Their measure would create a bipartisan commission to deal with Social Security, Medicare and Medicaid. The entitlement programs face eventual bankruptcy, although experts differ on how urgently each is threatened.
Many House Democrats, however, remain opposed to a commission, including Speaker Nancy Pelosi, who believes any changes should be addressed through congressional committees. Obama has been open to the idea -- and many others -- as a way to move toward a viable solution.
McConnell said any movement would be a step toward getting a handle on the unfunded liabilities.
Obama plans to cut the federal deficit in half by the end of his first term, mostly by scaling back Iraq war spending, raising taxes on the wealthiest and streamlining government. The goal is to halve the federal deficit to $533 billion by the time his first term ends in 2013.
He inherited a deficit of about $1.3 trillion from his predecessor, President George W. Bush.