Week Ending January 25, 2013
Debt Ceiling Raised Through May 18; Automatic Spending Cuts Slated for March 1
By a vote of 285-144, the House passed legislation (H.R. 325) that would allow the federal government to pay its bills until mid-May. The bill still requires Senate passage, which seems likely next week. It is unclear if or how the Senate will try to amend the bill, possibly to avoid another debt ceiling showdown like we experienced in August 2011 that resulted in a downgrading of the United States’ credit rating and a slowdown in employment growth.
In addition to suspending the debt limit through May 18, H.R. 325 would also require that both the House and Senate pass a budget by April 15. Failure to meet this deadline would require congressional salaries to be withheld until a budget is passed. Democrats have proposed, and AFSCME strongly supports, a long-term solution that would bar the debt ceiling from being used as a political ploy and endangering the U.S. economy.
Assuming the debt ceiling is pushed to May, the automatic, across-the-board spending cuts known as sequestration will loom large because they will begin on March 1 unless averted. If allowed to take effect, these cuts are deep and will harm the economy, programs that working families rely on, and state and local government budgets.
Coming up next, the funding bill for the current fiscal year will expire on March 27. Some GOP leaders have threatened a government shutdown which would disrupt innumerable programs and delay Social Security and unemployment checks, veterans’ benefits, home heating assistance and many other essential benefits.
House Republicans and Senate Democrats remain far apart on funding and deficit-reduction priorities, with the GOP leadership firmly resisting additional revenues and Democratic leadership demanding them. It is far from certain that an agreement will be reached either on legislation to replace the sequester or how to address funding for the rest of this fiscal year. GOP leaders continue to press for cuts to Medicare, Medicaid, Social Security and other core programs which have thus far been shielded from automatic cuts.
AFSCME continues to work with Congress to increase revenues to protect Medicare, Medicaid and Social Security, and funding for other critical services delivered by state and local governments.
Senate Makes Modest Reforms in Filibuster Rules
On Thursday, the Senate approved modest revisions in the filibuster rules which were agreed to by Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY). The deal will streamline some of the more cumbersome procedures but leaves intact the principle that an entrenched minority can force a 60-vote threshold to overcome a filibuster. Now, there will be two new limits on the minority’s ability to block the start of debate: 1) by eliminating one filibuster vote at the start of consideration of legislation (the motion to proceed) to a bill or nomination, and 2) by reducing to one from three the number of ways to filibuster efforts to start legislative conference negotiations with the House. Also, the debate time for many nominations will be reduced to two hours from 30 hours after a filibuster has been broken.
Affordable Care Act Helps Control Medicare Costs
A recent study by the Department of Health and Human Services found that Medicare spending per beneficiary grew just 0.4% per person in fiscal year 2012, thanks in large part to the Affordable Care Act. The success in reducing the costs per beneficiary helps set Medicare on a sustainable path without any reduction in benefits. While the Affordable Care Act has set a platform for protecting Medicare, work remains to be done since the baby boomers will increase the number of Medicare beneficiaries in this and the next decade. AFSCME supports ending the sweetheart deal given to the pharmaceutical industry in 2003 that prohibits Medicare from negotiating for lower drug prices.
President Barack Obama is Sworn-In for Second Term
On Monday, President Obama took the oath of office in a public ceremony on the steps of the nation’s Capitol. The crowd on hand was estimated to be 800,000 or more, much smaller than the crowd that turned out in 2009 but also much larger than inaugural ceremonies of the recent past.
The president’s inaugural address struck a number of themes, but consistent throughout was the notion that we are in it together. Together we solve problems, together we meet the challenges of the future, together we protect ourselves from life’s worst hazards and only through collective action can we achieve the fundamental value enshrined in our founding documents – that all of us are created equal. These principles, applied to the struggles of today, were laid out in the speech repeatedly and, in particular, in the following way: “For we, the people, understand that our country cannot succeed when a shrinking few do very well and a growing many barely make it. We believe that America’s prosperity must rest upon the broad shoulders of a rising middle class. We know that America thrives when every person can find independence and pride in their work; when the wages of honest labor liberate families for the brink of hardship. We are true to our creed when a little girl born into the bleakest poverty knows that she has the same chance to succeed as anybody else, because she is an American; she is free, and she is equal, not just in the eyes of God but also in our own.” The entire text of the speech is available at: http://www.whitehouse.gov/the-press-office/2013/01/21/inaugural-address-president-barack-obama
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