RFK Jr. Slashing 10,000 Jobs at HHS

HHS Secretary Robert F. Kennedy Jr. (Reuters)
Reuters
By Yuval Rosenberg and Michael Rainey

Happy Opening Day! The New York Yankees just beat the Milwaukee Brewers, putting them on pace for a 162-win season. And Tyler O'Neill of the Baltimore Orioles hit his sixth straight Opening Day home run, extending a record he already held.

Also today, President Donald Trump announced that he is pulling the nomination of New York Republican Rep. Elise Stefanik to be ambassador to the United Nations, citing a need to protect the slim GOP majority in the House to be able to enact his agenda. "With a very tight Majority, I don't want to take a chance on anyone else running for Elise's seat," Trump wrote on Truth Social.

Here's what else we're watching.

RFK Jr. Slashing 10,000 Jobs at HHS

Health and Human Services Secretary Robert F. Kennedy Jr. said Thursday that he plans to lay off 10,000 employees, bringing staffing levels at his department down to 62,000 - roughly 20,000 fewer than when President Donald Trump took office.

In a press release, the department charged with enhancing the health and well-being of the nation - which currently accounts for about 25% of the federal budget - said the staff reduction is in accordance with a Trump executive order issued in February. The moves will save an estimated $1.8 billion in costs in a departmental budget that came to roughly $1.7 trillion last year.

The newly announced staffing cuts come on top of roughly 10,000 job reductions that resulted from the Trump administration's government-wide offers of early retirement and voluntary separation.

Big changes ahead: HHS will also see significant reorganization, focused on Kennedy's vow to "make America healthy again."

"We aren't just reducing bureaucratic sprawl. We are realigning the organization with its core mission and our new priorities in reversing the chronic disease epidemic," Kennedy said. "This Department will do more - a lot more - at a lower cost to the taxpayer."

The organizational restructuring will include reducing 28 divisions at HHS to 15, closing half of the department's 10 regional offices, and centralizing key functions, such as human resources, information technology, procurement and policy. A new Administration for a Healthy America will consolidate multiple existing offices, with a focus on chronic care, disease prevention programs and health resources for low-income Americans.

Job losses will hit multiple agencies within HHS. The Food and Drug Administration will lose 3,500 full-time employees, while the Centers for Disease Control and Prevention will lose 2,400, although the CDC will pick up 1,000 employees currently with the Administration for Strategic Preparedness and Response. The National Institutes of Health will eliminate 1,200 workers through centralization of office functions across its 27 institutes and centers. And the Centers for Medicare & Medicaid Services will lose 300 jobs, which HHS said "will not impact Medicare and Medicaid services."

**Advocates sound the alarm: **Public health advocates expressed doubts about the likely effectiveness of the cuts and reorganization. "Losing people, losing money, making relationships dysfunctional is not going to improve the health of the American people," said Dr. Georges C. Benjamin, head of the American Public Health Association, per The Washington Post. "Wrong diagnosis, wrong therapy."

Democratic lawmakers said the layoffs and closures would hurt Americans who rely on public health services. "These offices work closely with communities to make sure child care, hospitals, and nursing homes are safe, strengthen rural health care, and much more," Sen. Ron Wyden, the senior Democrat on the Finance Committee, said in a statement. "The chaos that is coming will guarantee that kids and seniors fall through the cracks with deadly consequences."

Sen. Patty Murray of Washington said she sees the cuts as largely destructive. "It does not take a genius to understand that pushing out 20,000 workers at our pre-eminent health agencies won't make Americans healthier-it'll just mean fewer health services for our communities, more opportunities for disease to spread, and longer waits for lifesaving treatments and cures," she said, according to The Wall Street Journal.

Still, some lawmakers welcomed the news, saying HHS is unwieldy and in need of a shakeup.

Sen. Bill Cassidy, the Republican physician from Louisiana who played a pivotal role in approving Kennedy's nomination for the top job at HHS, said he hoped the new plan would generate efficiency and improve services. "I am interested in HHS working better, such as lifesaving drug approval more rapidly, and Medicare service improved," he told the Journal. "I look forward to hearing how this reorganization furthers these goals."

CBO Projects Rising Debt, Slower Economic Growth

The national debt is set to "grow far beyond any previously recorded level over the next 30 years," the Congressional Budget Office said Thursday. At the same time, the nonpartisan budget scorekeeper said that it now expects that both the deficit and federal debt held by the public will be somewhat lower in 2054 than it projected last year.

CBO's latest Long-Term Budget Outlook said that, under current law, debt held by the public - what the government owes to entities outside of the federal government, including individuals, businesses, state and local governments, foreign governments and more - will rise from 100% of gross domestic product at the end of this fiscal year to 107% of GDP in 2029, topping the high reached after World War II. It then continues to grow, hitting 156% of GDP by 2055.

"That large and growing debt has significant economic and financial consequences," the CBO report warns. "Over time, it slows economic growth, drives up interest payments to foreign holders of U.S. debt, makes the nation's fiscal position more vulnerable to an increase in interest rates, heightens the risk of a fiscal crisis, and increases the likelihood of other adverse outcomes."

As a share of the economy, the deficit is projected to climb from 6.2% this year to 7.3% by 2055. "Deficits average 6.3% of GDP over the 30-year period, which is 2.5 percentage points more than they averaged over the past 50 years," CBO says.

Net interest payments, the fastest-growing part of the budget, are seen growing from 3.2% of the economy in 2025 to 5.4% by 2055. "If interest costs followed their projected path, net interest outlays would exceed all discretionary outlays in 2052," the report says.

The report also projects that economic growth will be slower over the next three decades than over the past three decades, in part because of slower population growth and declining participation in the labor force. "Without immigration, the U.S. population would begin to shrink in 2033," it notes.

The debt outlook has shifted quite a bit since last year, though. "Federal debt held by the public in 2054 is now projected to be 12 percent of GDP less than it was projected to be in last year's report, and the deficit is now projected to be 1.3 percent of GDP less," the new report says. "Lower spending, particularly for net interest costs and Medicare, and higher revenues in CBO's current projections result in smaller debt and deficits."

The report comes as the Trump administration and Republicans in control of Congress are working to enact a massive package including trillions of dollars in tax cuts and spending reductions. CBO's analysis doesn't factor in those GOP tax plans or the effects of Trump's tariffs and various other economic policies his administration is pursuing.

An extension of expiring 2017 tax cuts would add more than $37 trillion to the national debt over the next 30 years, according to the nonpartisan Committee for a Responsible Federal Budget (CRFB), which advocates for deficit reduction. CBO estimated last week that debt held by the public will soar to 214% of GDP over the next 30 years, nearly 50% higher than its baseline forecast, if Republicans make their 2017 cuts permanent.

"CBO reports like this routinely present a sobering assessment of the dismal state of America's finances," said CRFB President Maya MacGuineas, "and our political leaders nod their heads in agreement that we need to do something. And then they do nothing, or even worse - they claim their priorities are too important to let the threat of higher debt get in the way of enacting their agenda."

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