Washington, DC–(ENEWSPF)–September 19, 2011. Working people are clamoring for leaders in Washington to focus first and hard on creating good jobs. Speaker Boehner was channeling George Orwell when he claimed the Congressional Super Committee is a jobs committee. The way to create jobs is not through fiscal austerity and cuts to core middle class programs like Social Security, Medicare, and Medicaid. Let’s be clear: if the Super Committee were to follow Speaker Boehner’s advice, it would deepen our jobs crisis and sink our economy into a black hole. This is the same failed economic philosophy that drove our economy off a cliff in the first place, and is now once again bringing the global economy to a standstill.
This is why working people will spend the month of October telling all members of Congress that “America Wants to Work” and demanding that they not push through job-killing proposals. Congress must take urgent action to address the jobs crisis on a scale that is equal to the size of the problem. This will undoubtedly require enactment of more than one piece of legislation, but it must include the $140 billion in additional infrastructure investment and state aid proposed by the President in the American Jobs Act. We cannot hope to put our fiscal house in order if we do not put America Back to Work.
The AFL-CIO believes that while Congress should focus first and foremost on solving the jobs crisis, the national debt can be stabilized in the long term in ways that will not make the immediate jobs crisis worse and addresses the real causes of our long-term fiscal imbalance. The Super Committee can meet its targets through a combination of (1) drawing down from Iraq and Afghanistan; (2) health care cost containment that does not diminish benefits or cut Medicaid; and (3) progressive tax revenues.
This memo further details the positions of the AFL-CIO on the various aspects of policy facing the Congressional Super Committee.
Jobs. We support Sen. Merkley’s proposal to require a CBO score of the jobs impact of every proposal considered by the Committee.
No Benefit Cuts The Super Committee should oppose any cuts in Medicare or Social Security benefits or the federal contribution to Medicaid.
Health Care Cost Containment Health care cost growth can and must be brought under control, but cutting benefits is not the answer. The AFL-CIO has endorsed proposals to reduce the deficit through Medicare negotiation of drug prices ($200 billion over 10 years); establishing the option of a public health insurance plan ($88 billion over 10 years, more than $15 billion in one year); and allowing the re-importation of prescription drugs ($11 billion over 10 years); as well as requiring a Part D rebate for dual eligible Medicare beneficiaries and low-income subsidy recipients ($120 billion over 10 years).
Drawdown from Iraq and Afghanistan The Ryan budget resolution included over $1.2 trillion in savings from drawing down from overseas contingency operations (OCO) in Iraq and Afghanistan. The Super Committee should apply these savings towards its target.
Progressive Tax Revenues The Budget Control Act of 2011 already cut $915 billion from discretionary spending, and it is only fair to insist on $915 billion in progressive tax revenue before any more job-killing budget cuts. It is obscene even to suggest cuts in Social Security or Medicare benefits or Medicaid when there has been no provision for the expiration of Bush-era tax cuts for the wealthy. The AFL-CIO has endorsed progressive tax revenue proposals that would meet the Super Committee’s deficit reduction target, some of which could be phased in over time. These include a miniscule tax on financial transactions (more than $1 trillion over 10 years); a surtax on millionaires (more than $400 billion over 10 years); taxing capital gains as ordinary income (more than $168 billion over 10 years); and eliminating deferral of income from foreign subsidiaries, which encourages firms to export American jobs (more than $100 billion over 10 years).
Scapegoating Federal and Postal Employees and Retirees Federal workers have already sacrificed $60 billion over 10 years as a result of the two-year pay freeze. Agencies are freezing hiring and planning layoffs to comply with the appropriations cuts imposed by the debt ceiling deal. Any further cuts to pay, health insurance and retirement benefits will harm the livelihood of federal and postal employees, make it much harder to attract qualified candidates for federal jobs and further hurt our economic recovery.