The ‘Grand Bargain’ Would Hurt Middle Class Working Families

I am happy the elections are over, because now we can get back to work on resolving the issues that have dominated the campaigns over the last nine months.  Everyone agrees that we need to do something about the National Debt.  The debt issue and the looming ‘sequestration’ budget cuts are now all people seem to be talking about.

The two issues are one in the same.  Sequestration is the result of the super committee failing to reach agreement on budget cuts to balance the budget and reduce the debt.  Their failure triggers an automatic budget cut of one trillion dollars.

Right now there are two very different trains of thought on how to resolve this looming destruction. President Obama wants to raise taxes on the ultra-wealthy and continue to reduce the burdon on students and middle class families. (Watch the full video here. )

I’m committed to solving our fiscal challenges,” he said. “But I refuse to accept any approach that isn’t balanced. I am not going to ask students and seniors and middle-class families to pay down the entire deficit while people like me, making over $250,000, aren’t asked to pay a dime more in taxes. I’m not going to do that.”

Contrary, the Speaker of the House John Boehner, wants to extend the ‘Bush Era Tax Cuts’ and make deep cuts to the Federal Budget. Boehner says he would be willing to compromise to stop the sequestration cuts but held firm on his stance not to raise taxes.

Flicker Creative Commons via DonkeyHotey

Labor organizations are getting ahead of the lame duck session calling for action not cuts to entitlement programs.

“The American Federation of Government Employees strongly opposes any legislative action that reduces Social Security or Medicare benefits, reduces federal jobs or lowers the living standards of the middle-class men and women who comprise the federal workforce.”

Congresses so-called “Grand Bargain” would be an unmitigated disaster for all middle-class and working class Americans, including the men and women who make up the federal workforce. Their plan:

  • Cuts Social Security benefits by raising the retirement age, changing the benefit formula, and reducing cost of living adjustments (COLAs) by using an inferior measure of inflation.
  • Voucherizes Medicare, adjusting it by the Consumer Price Index (CPI) rather than the rise in health care costs. This saves the government money solely by shifting health care costs to seniors who, inevitably, will not be able to afford the care they need.
  • Adds three years to the two-year federal employee pay freeze, for a total of five years with no raise. In the meantime, the price of everything else goes up: health care premiums, rent, child care, gas and electricity.
  • Voucherizes the Federal Employees Health Benefits Program (FEHBP), adjusting it by the CPI rather than the rate of premium increases, so that they pay far more for already unaffordable health care.
  • Cuts 10% of jobs in every federal agency. Such reductions would force VA nursing assistants to take care of 30% more veterans with 30% less support and would throw 200,000 more Americans out of work.
  • Slashes retirement benefits by charging workers more and reducing the amount they receive. Benefits would be cut by between a third and a half, leading to old age poverty for people who worked and faithfully contributed to a fully-funded system for 30 years.
These two very different ideas have two very different outcomes for middle class families.  

“No cuts to Social Security, Medicare or federal employee jobs or compensation are justified now or in the future, and no amount of deception, misrepresentation or hyperbole regarding the budget can change that fact.”
– AFGE National President J. David Cox Sr.

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About Matt Murray

Matt Murray is the creator and an author on the NH Labor News. He is a union member and advocate for labor and progressive politics. He also works with other unions and members to help spread our message. Follow him on Twitter @NHLabor_News
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