Week Ending April 4, 2014
Ryan Budget: A Road to Ruin
This week House GOP Budget Chairman Paul Ryan (R-WI) introduced a budget with the same wrong-headed policies and priorities that we have come to expect from him over the past four years. This time, the cuts are even deeper and more harmful to pay for big new tax cuts for the wealthy and to boost Pentagon spending. The Budget Committee passed the proposal 22 to 16 along party lines, with no Democratic support. The committee rejected all Democratic amendments, including those to raise the minimum wage, stop cuts to education and student loans, and to implement comprehensive immigration reform.
The spending reductions in this budget of more than $5.1 trillion over the next decade would incapacitate state and local governments, leading to massive cuts in vital public services and enormous job losses that would threaten our fragile economic recovery. The Economic Policy Institute (EPI) projects that the proposal would result in the loss of three million jobs next year. Fully 69% of its cuts come from low-income programs while defense spending is increased by $483 billion. Funding for programs including job training, public education, student loans, child care, infrastructure, health care research and more would be cut by least 24%. Job training programs would serve 3.5 million fewer individuals, Head Start would serve 170,000 fewer children, and Title I would serve 3.4 million fewer disadvantaged K-12 students, likely resulting in the loss of 29,000 jobs for teachers and aides. Student loans would become much more expensive because students would be charged interest while still in college, and the maximum Pell grant at best would be frozen. SNAP (formerly food stamps) would be converted into a block grant and cut by an extraordinary $137 billion, threatening food security for the most vulnerable. And, it completely eliminates the Social Services Block Grant which currently funds child care, child welfare services and other vital programs and services.
The Ryan budget once again robs working families to subsidize tax cuts for the wealthy and corporations. It would reduce the top individual tax rate on the highest income Americans from 39.6% to 25% and reduce the corporate tax rate from 35% to 25%. It raises taxes on middle class families with children by an average of at least $2,000 in order to cut tax rates for households with incomes over $1 million. In addition, Ryan’s budget fails to identify a single special interest tax break that would be ended to reduce the deficit, such as those benefiting large oil and gas firms or offshore tax havens.
The budget would end Medicare as we know it by turning the guarantee of medical care for seniors into a voucher for all beneficiaries. It raises the age for Medicare eligibility to 67 for individuals born in 1959 or later. This change would increase costs for seniors, states and employer retiree health plans, which will be forced to bear the costs of private health insurance for an additional two years. It would also increase Medicare beneficiaries’ costs for prescription drugs and for recommended preventive care, including mammograms and prostate cancer screenings.
The Ryan budget also takes an ax to the Medicaid program, cutting Medicaid by $732 billion – nearly 30%. This enormous cut would be on top of proposed cuts from repealing the Affordable Care Act’s federal support to states for expanding Medicaid. The ranks of the uninsured would increase, further stressing low-income individuals, hospitals and communities. As a consequence, states will be forced to eliminate services and reduce coverage. Because two-thirds of Medicaid expenditures are for low-income seniors and people with disabilities, states will be forced to make deep cuts in nursing home and other long-term care services for these vulnerable populations.
The House is expected to vote on the budget next week. AFSCME is strongly opposing the Ryan budget.
Tell Your Representative to Vote “No” on the Ryan Budget!!!
Next week the House will vote on the GOP House Leadership’s budget, authored by Rep. Paul Ryan. It proposes deep spending cuts to pay for tax cuts benefiting the wealthiest 2% of Americans and corporations. It would kill jobs and put our economy into a tailspin, slash Medicare and Medicaid benefits and repeal the Affordable Care Act.
Call your Representative toll-free at 1-855-712-8590.
Urge your Representative to vote against Rep. Ryan’s unbalanced, unfair budget proposal. The budget would end Medicare and Medicaid as we know them and slash vital programs and services to pay for tax breaks for the wealthiest Americans and corporations.
Final Senate Vote to Extend Federal Unemployment Benefits Set for Next Week
The Senate this week continued to work through the obstacles that GOP leaders threw in front of legislation providing for a five-month extension of the Federal Emergency Unemployment Compensation program (H.R. 3979). On Thursday, a motion to end debate on the bill passed with the necessary 60 votes. Under the Senate’s rules, this action clears the way for a vote on final passage of the legislation on Monday, April 7. Only 50 votes will be necessary to move the bill on to the House of Representatives, where it will face another uphill climb.
House GOP Unanimously Blocks Consideration of Minimum Wage Increase
In a party-line vote Wednesday, the House GOP majority blocked consideration of an amendment to pending legislation that would have raised the federal minimum wage to $10.10 per hour. In spite of broad bipartisan and public support, no Republican member crossed party lines to allow the measure to come up for a vote.
The Senate was scheduled to vote on Sen. Tom Harkin’s (D-IA) Minimum Wage Fairness Act (S. 460) next week but it now seems unlikely to come up until later in the month, if 60 senators agree to proceed to debate the bill.
One-Year Medicare Deal for Doctors Enacted; Cuts to Safety Net Hospitals Delayed
On Monday, the Senate approved legislation (H.R. 4302) passed by the House to overrule cuts to Medicare payments to physicians for one year by a bipartisan vote of 64 to 35. The so-called “patch” ends April 1, 2015. On Tuesday, the President signed the bill into law.
The law also delays cuts in Medicaid payments to public safety net hospitals for one year. It continues the Transitional Medical Assistance (TMA) program for one year, which allows families to maintain Medicaid coverage as they move into employment and increase their incomes. It also creates a new grant to support community mental health providers to offer a broad range of mental health services. And, it continues federal support for Maternal, Infant, & Early Child Home Visiting Programs through March 31, 2015.
This is the 17th time that Congress has overridden scheduled cuts in Medicare payments to doctors. There is bipartisan agreement to repeal and replace the flawed Medicare payment system for physicians, but there is no agreement on how to pay for the needed policy changes.
Push in House for Comprehensive Immigration Reform Continues
Congressional supporters of comprehensive immigration reform (CIR) continue to use all means at their disposal to force House Speaker John Boehner (R-OH) to hold a vote before the Senate bill (S. 744) expires at the end of 2014. A pending House bill (H.R. 15), modeled on the Senate bill, has 200 bipartisan co-sponsors. This means only 18 additional House members would have to vote in favor for the bill to pass. More than that number are on record in support of CIR. To put further pressure on the House GOP leadership, over 190 House Democrats have signed what’s called a “discharge petition” to force a vote on H.R. 15. A majority of House members must sign for the petition to have its intended effect.
House CIR supporters are seizing upon other opportunities to highlight the need for comprehensive reform. This week, Rep. Tony Cardenas (D-CA) sponsored an amendment to Budget Committee Chair Paul Ryan’s FY 2015 budget that would have implemented H.R. 15 through the budget process. “Any serious debate on balancing our budget must include comprehensive immigration reform,” Cardenas said, noting that the Congressional Budget Office (CBO) concluded that H.R. 15 would reduce the federal budget deficit by $900 billion over two decades. It also would add tens of thousands of jobs to our economy. Unfortunately, the amendment was rejected along party lines, 15 to 21.
Build It, and They Will Come
On March 31, the inaugural open enrollment period for the Affordable Care Act ended with a bang. Over seven million people signed up for private coverage through health exchanges operated by the federal government or some states. The seven million mark was the original estimate of enrollment that the CBO had made last summer, before the federal exchange was launched. Given the rocky beginnings, the federal exchange made up a lot of ground in order to meet the original enrollment estimate. But more than that, the enrollment numbers are an indication of the eagerness of millions who could finally access affordable coverage. The open enrollment is officially over, but those who were in the middle of researching coverage options will still be able to complete their enrollment. The next open enrollment period begins in the fall. In addition to those who obtained private coverage through the exchanges, three million young adults have health care through their parents’ plans, which must extend coverage up to age 26. Millions more are gaining coverage through Medicaid programs that have been expanded in 27 states.
Tax Extenders Approved by Senate Finance Committee
The Senate Finance Committee approved extending a costly set of temporary, expired tax provisions called the tax extenders package. The package includes tax breaks for individuals, including the deduction for state and local sales taxes, the mass transit commuter tax benefit to extend transit parity, the deduction for mortgage insurance premiums, as well as some significant tax benefits for businesses, such as the Research and Development (R&D) tax credit; Work Opportunity Tax Credit; Expensing (Section 179); Bonus Depreciation; and breaks encouraging energy efficiency.
The popular mass transit commuter tax break, which is championed by AFSCME, would re-establish parity between the parking and mass transit portions of the transportation fringe benefit, more commonly known as the commuter benefit. At the end of 2013, the monthly cap on the mass transit portion of the commuter benefit dropped to $130 per month because Congress failed to act. The monthly cap on the parking portion, on the other hand, increased from $240 per month to $250 per month because of a cost-of-living adjustment. The legislation passed by the Senate Finance Committee will restore parity by increasing the mass transit cap to $250 per month through the end of 2015.
New Finance Committee Chairman Sen. Ron Wyden (D-OR) led the effort to extend the tax provisions that expired at the end of 2013. Significant questions were raised by panel members and others about the cost and effectiveness of some of the big corporate tax loopholes, particularly those that provide tax breaks to companies that ship profits and jobs offshore, but those concerns were brushed aside. The 10-year cost of a two year extension is pegged at about $90 billion. No provision was added to pay for any of them. House Ways and Means Committee Chair David Camp (R-MI) plans to hold hearings on the extenders with an eye towards making some of the temporary tax provisions permanent.
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