In the summer of 1997, a rare moment of bipartisanship between Democratic President Bill Clinton and Republican Speaker of the House of Representatives, Newt Gingrich, became the foundation of suspicion that would span for decades.

Follow me down the rabbit hole. I'm your host, Danny, and today we are talking about the balanced budget act of 1997. Thank you, Kelly, for requesting this episode. If you guys would like to request an episode or you want a shout out for requesting an episode, go to stay skeptical.com. You can also go to my Instagram and submit your requests through the link in the bio.

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The balanced budget act of 1997 was an omnibus legislative package designed to balance

the federal budget by 2002. It was to result in $160 billion in spending reductions between

1998 and 2002. After taking into account an increase in spending on welfare and children's health care,

the savings totaled $127 billion, Medicare, taking the blunt of the cuts at $112 billion.

They reduced the Medicare spending by reducing payments to health service providers.

The Balanced Budget Act of 1997 represented not just a legislative victory,

but an unusual convergence. Clinton's third way centristism meeting Gingrich's revolutionary

conservatism on common ground. While marketed as a triumph of fiscal responsibility,

the BBA acted as the economic dial that permanently set the American safety net on a path toward privatization.

Beneath the facade of saving Medicare, the act implemented complex formulas and structural handovers

that signaled the end of representative democracy in fiscal matters in the beginning of a technocratic uniparty era.

By moving the levers of economic power out of the reach of the ballot box and into the hands of algorithmic automatic

stabilizers, the BBA ensured that the fundamental direction of the American economy would

remain untouched by future elections. The big question is, what made Clinton and Gingrich political enemies suddenly aligned so perfectly

on such drastic changes on Medicare, Medicaid, and welfare?

Many skeptics started questioning whether it was really a compromise or just a consensus

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