Week Ending January 31, 2014
President Obama delivered his State of the Union address to a joint session of Congress this week, emphasizing growing income inequality and the need to expand opportunity to “speed up growth, strengthen the middle class, and build new ladders of opportunity into the middle class.” He said he wants to work with Congress toward his goals, but will not hesitate to go around them if necessary by using his broad administrative authority to institute change. "Wherever and whenever I can take steps without legislation to expand opportunity for more American families, that's what I'm going to do." AFSCME President Lee Saunders called on Congress to work with the President to take steps to address growing income inequality which hampers meaningful economic recovery in our country, calling it “the defining challenge of our time,” adding that the best way to combat inequality is by “empowering workers to bargain for better pay and secure benefits.”
The cornerstone of President Obama’s speech addressed the need to increase wages and put people back to work. Not waiting for Congress, a new Presidential Executive Order will be issued to raise the minimum wage to $10.10 an hour for individuals working on new federal service contracts. He also called upon Congress to pass legislation (S. 460/H.R. 1010), introduced by Sen. Tom Harkin (D-IA) and Rep. George Miller (D-CA), to raise the minimum wage from $7.25 to $10.10 and index it to inflation, while also raising the minimum wage for tipped workers for the first time in over 20 years. Additionally, he called for Congress to pass an extension of emergency unemployment insurance benefits for the longer-term unemployed, which Congress let expire in December, and to expand the Earned Income Tax Credit (EITC) by making it available to more lower-wage workers. The President also said that too many low-wage jobs are occupied by women, and once again called on Congress to pass the Paycheck Fairness Act which would strengthen the Equal Pay Act of 1963 and provide women with more tools to fight pay discrimination.
President Obama also emphasized on the need to create additional jobs and to build a “21st Century Workplace.” To achieve this he called for new investments to rebuild roads, bridges, transit, rail, energy and water infrastructure, financed by reforming business taxes and closing corporate tax loopholes. Moreover, the President is taking action on retirement security by directing the Department of Treasury to create a new starter savings account, called “myRA,” which will be made available through employers to help millions of workers who currently do not have access to a retirement savings account. He also renewed his request that Congress pass legislation giving all Americans access to automatic IRA accounts on the job.
In an effort to match workers to prospective employers, the President has directed Vice President Joe Biden to conduct a government-wide review of federal training programs with an eye towards skills improvement and ensuring that programs are driven by the needs of employers. Additionally, his administration is seeking to mobilize business, community colleges and labor to work together to expand innovative apprenticeships to meet changing labor needs. For education, he wants to increase college opportunity and graduation rates by making college more affordable, increasing the maximum Pell Grant award for working and middle-class families, pursuing effective student loan reforms and making high-quality preschool available to more children so they can succeed in K-12 and college.
President Obama also has renewed his call for fixing our broken immigration system by strengthening our border security, cracking down on employers who hire undocumented workers, and providing an earned path to citizenship for immigrants. The President also strongly defended the Affordable Care Act, touting its success in extending coverage to more than nine million Americans, eliminating pre-existing condition exclusions and lowering prescription drug costs for millions of seniors. He encouraged those who lack coverage to enroll by March 31.
Senate Democratic leaders are continuing to try to find a way to attract enough Republican support for continuing the federal unemployment benefits program, which expired December 28. Backing their efforts, AFSCME joined with the AFL-CIO, SEIU, Steelworkers and other allied organizations to conduct field actions in the states of a number of Senate Republicans during the congressional recess. A three-month extension that would be retroactive to the beginning of January and run through the end of March was introduced in the Senate this week, and a vote is expected next week. In the meantime, we are keeping up our phone and email campaign.
AFSCME and Allies Urge Congress to Renew Federal Unemployment Benefits
Alongside coalition allies, AFSCME is urging Congress to pass legislation to renew federal unemployment immediately. If Congress continues to fail to act, up to 3.2 million jobless workers will lose federal benefits after their state benefits run out.
AFSCME urges you to call your Senators and Representative now! Call toll-free at 877-363-6141 and urge them to fully reinstate federal unemployment benefits.
During its retreat this week, the House GOP released bare-bones “standards” for immigration reform. Clocking in at a page and a half, the document does little to clarify where the House GOP leadership is headed, if anywhere, after the Senate passed its comprehensive immigration reform bill (S. 744) seven months ago with a bipartisan vote of 68-32. Vague as the GOP document is, it is a good sign that the House leadership has finally taken some step on this vitally important issue and has moved away from promoting self-deportation for the 11-12 million undocumented immigrants living and working in the U.S. The document explicitly calls for a path to citizenship for the “DREAMers”, undocumented immigrants who were brought to the U.S. as children. However, depending on how the policies are fleshed out, most of the currently undocumented could become part of a permanent underclass with legal status but no achievable path to citizenship. It is against everything our country stands for to relegate hard-working aspiring Americans to perpetual second-class status. Another very troubling aspect of the document is the apparent embracing and doubling-down on failed guest worker programs that harm both U.S. and foreign workers.
It remains to be seen if the political will exists among the House GOP leadership to pass legislation that would actually fix our broken immigration system. The tea-party wing of the Republican party is still rejecting any movement on immigration reform this year, fearing primary challenges from the right for their re-elections this year. Pending legislation exists (H.R. 15) which closely mirrors the Senate bill and has 195 co-sponsors. Unfortunately, only a handful of GOP House members have signed on, and the leadership refuses to move this bill forward. We will continue to work with our allies to demand that the House leadership move forward with H.R. 15 or with another detailed legislative proposal that will provide for an achievable roadmap to citizenship for the 11 million, vital worker protections and other key reforms.
The House this week passed a Farm Bill which had taken weeks for Senate and House negotiators to hammer out. The vote was 251-166, with 103 Democrats and 63 Republicans voting against the bill.
The Democrats who voted against the bill did so largely because they opposed the cuts in the Supplemental Nutrition Assistance Program (SNAP), while the Republican members opposing it believed the cuts were not deep enough. The bill cuts SNAP by $8.6 billion over the next 10 years, substantially less that the almost $40 billion in SNAP cuts in the House-passed bill, yet twice the $4 billion in the Senate-passed bill. The reduction is achieved by tightening up on the way states calculate utility costs, a factor in determining eligibility for benefits. Almost 4% of SNAP beneficiaries would face a benefit cut; 850,000 households would face a significant benefit reduction of an estimated average of $90 per month.
As part of the agreement to eliminate the tough work requirements in the House-passed bill, negotiators agreed to establish a new work pilot program consisting of up to 10 pilots that would run for three years. Among the activities would be public and private subsidized and unsubsidized employment and workfare (working off the value of SNAP benefits, often in public agencies). Participation could be voluntary or mandatory. Existing SNAP non-displacement and other worker protection provisions would apply and a rigorous evaluation is required.
The bill also prohibits the use of administrative funds on television, radio and billboard ads to promote the program, including among those who are eligible but not receiving food assistance.
Senator Majority Leader Harry Reid (D-NV) has broken publicly with the White House on trade promotion authority (TPA). By doing so, he instantly imperiled two major international trade deals – the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP) – punching a hole in one piece of the economic agenda the President outlined in his State of the Union address on Tuesday. Senator Reid said, “I'm against fast track ... I think everyone would be well-advised just not to push this right now.” Reid’s comments show how difficult it will be for the President to win fast track authority from Congress. AFSCME opposes fast track and urges a new course on trade policy after decades of devastating job losses and attacks on environmental and health laws resulting from past trade agreements.
Three Senate Republicans Announce Proposal to Replace The Affordable Care Act
Senators Tom Coburn (R-OK), Orrin Hatch (R-UT) and Richard Burr (R-NC) announced they will introduce legislation to repeal almost all of the Affordable Care Act (ACA) and replace it with an alternative health care plan. While they have not yet released an actual bill, based on their description, their plan would:
- Tax employees for coverage provided by their employer;
- Repeal the ACA’s Medicaid expansion and turn Medicaid into a block grant, taking health coverage away from millions and cutting federal payments to the states;
- Weaken and eliminate consumer protections, especially for people with pre-existing conditions;
- Reduce tax credits subsidies to purchase coverage for those who do not have health coverage through their employer;
- Allow insurance companies to once again set annual limits on payments for benefits, charge women higher premiums than men, and prohibit parents from covering adult children up to age 26 on their insurance plans; and
- Repeal the ACA’s requirement that insurance companies spend at least 80% of premiums on health care services, rather than on CEO pay, advertising or shareholder profits.
For three years, Republican leaders have been criticized for trying to repeal the Affordable Care Act but not offering an alternative that would replace it. Unfortunately, this alternative returns us to the days when insurance companies could jack up prices at will and use loopholes to deny coverage or prevent paying customers from getting the care they need. Moreover, by taxing workers on their health coverage, it would drive up costs for the more than 150 million people who get health care coverage through their or a family member’s job.
According to researchers at the Brookings Institution, the Affordable Care Act, which was designed to expand health insurance coverage, improve quality and slow the growth of health care costs, also will help address income inequality. The research projects the law will improve the economic well-being of those with incomes in the bottom 20th percentile, who will see increased income of almost 6%. Those in the bottom one-tenth will see an increase of more than 7%. The law benefits these lower-income Americans by requiring employers to offer affordable health insurance to their full-time employees, providing refundable tax credits making private health insurance affordable, and expanding eligibility for Medicaid. Given that nearly every aspect of social and economic justice is connected to access to health care, the Affordable Care Act is a foundation for not only health security but also economic security and expanding the middle class.
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