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What a choice! One year of investment tax cuts equals 10 years of Social Security cuts?

Choices to surviveBudgets are all about choosing priorities.  And here’s one choice: chained CPI?  Or eliminate the tax break for investment income?

When I looked at the numbers this morning, I was stunned.

Chained CPI is a way of recalculating – and permanently lowering – everyone’s Social Security benefits.  It has been a top Republican priority for years.  The White House Budget Director estimates that changing to chained CPI would save the federal government $150 billion over the next decade.

And how much does the federal government spend on tax breaks on investment income?  According to Congress’ Joint Committee on Taxation, tax breaks on investment income will cost $161 billion this fiscal year alone.

Go back and read that again.

Tax breaks on investment income cost the federal government more – in just one year – than chained CPI would save over an entire decade.

Budgets are all about choices.  For many American families, the choices are between food and heat, medicine or mortgage?  For Congress, as it debates this budget, the choices are about who pays – and who benefits.

I’m still stunned.  One year of treating investment income as if it was wage income would pay for ten years of the Republicans’ proposed cuts to Social Security benefits.

I’m still at a loss for words.  It is morally wrong, that this choice is even being considered.

 

The House GOP Is Acting Like Teenagers, As President Obama Submits His Budget

This Wednesday, President Obama is expected to file his budget proposal for the next fiscal year.

Are you wondering why his budget is expected to include

Straight from an observer in DC, here is the best explanation I’ve heard so far:  Having President Obama support these policies is a guaranteed way to get Republicans to oppose them.

“Yes, we have reached that level of adolescence on Capitol Hill.”

Here’s the thing about teenagers: they don’t always think ahead to the consequences of their actions.

14 Days of Furlough Is Better Than 22, But It Is No Win

US_Capitol_by_DBKing_FlikrYesterday it was announced that the Department of Defense would reduce the number of forced furloughs for DOD civilian employees from 22 days (one month over the next six) to 14 workdays.

“Most Defense Department civilians can expect 14 furlough days this year instead of the previously planned 22 days, Defense Secretary Chuck Hagel confirmed Thursday, adding that the department needs additional flexibility to respond to across-the-board budget cuts from sequestration.”
(GovExec.com)

This is somewhat good news for the over 5000 workers at the Portsmouth Naval Shipyard who have been fighting back against the mandatory sequester cuts.

Giving workers almost two work weeks of pay back, or in other words not taking two weeks worth of pay is good, however it should not be called a win.  The fact that the DOD is going to take another three weeks of pay from these men and women is a shame.

“Federal employee unions were not buying into the Hagel’s reasoning. Defense is not taking full advantage of the added flexibility and “needs to eliminate furloughs entirely,” the American Federation of Government Employees said in a statement Thursday.”

“The department’s leaders have always had the flexibility to impose budget cuts from sequestration in any way they chose,” AFGE National President J. David Cox Sr. stated. “Although reducing the number of furlough days from 22 to 14 shows that they’re listening, they still haven’t gotten the whole message.”
(GovExec.com) (see full release from AFGE)

We need to continue to push our elected Congressional Representatives and U.S. Senators to pass a budget that will eliminate all of the furloughs throughout the government.  The Sequester has already begun and companies have already started to shed workers due to these cuts.  For federal employees there is still time to fix this problem before real harm is done to these middle class families.  Most of the furloughs will not take effect until the second week of April.  This means that Congress could come back from their vacation (recess) and do what they are elected to do.  Pass a budget to remove the sequester cuts, and keep the federal government open for business.

John Joyal a worker at the Portsmouth Naval Shipyard in Portsmouth, NH summed it up completely at a rally to cancel the cuts last week.  He said:

The men and women at that shipyard over there – every single day, they put their politics aside, their gender aside, their religion aside, their ideological beliefs aside, you name it, they put everything aside to go perform the people’s business.

“That flag right there does not belong to the right-wing of the GOP of our Congress, that flag belongs to the American people. What the US Congress needs to do is, they need to grow up, put their differences aside, go into a room and perform the people’s business just like the people on this island do, every single day.

(Video of John Joyal’s speech, a must watch)

The one video every Republican, Democrat and Independent must see!!!


More than 200 people rallied at the Portsmouth Naval Shipyard yesterday to rally against the budget cuts known as “sequestration”.

At the same time they were rallying, Congress passed a bill to make most of those cuts permanent.

That bill – the “continuing resolution” to fund the federal government for six months – also rescinded a long-planned increase in pay for federal workers. Read Congress Adds Insult to Injury!

The continuing resolution was crafted to protect military contractors from the effects of sequestration – at the expense of federal employees, including Portsmouth Shipyard workers. Read more about Sen. Kelly Ayotte’s defense of defense contractors here.

As Portsmouth Shipyard worker John Joyal told the crowd yesterday:

The men and women at that shipyard over there – every single day, they put their politics aside, their gender aside, their religion aside, their ideological beliefs aside, you name it, they put everything aside to go perform the people’s business.

“That flag right there does not belong to the right-wing of the GOP of our Congress, that flag belongs to the American people. What the US Congress needs to do is, they need to grow up, put their differences aside, go into a room and perform the people’s business just like the people on this island do, every single day.

There are other options. Ending special corporate tax breaks would pay for the sequester cuts twice over. Ending tax breaks on unearned income would pay for the sequester cutsplus everything the House GOP wants to cut from next year’s federal budget.

Is this the best six-month budget that our Congress can come up with?

Congress Adds Insult To Injury! Pay Freeze Continues As Sequester Sets In

Smashed Piggy Bank RetirementLet me start by saying the last thing I want to see is a full government shutdown.  However once again Congress as a whole takes more from the piggy bank they call federal workers’ pay.

“Congress on Thursday agreed on a measure to keep the government running through the end of the fiscal year. The bill, which also extends the pay freeze on federal employees, now heads to President Obama.”  (GovExec.com)

What is becoming a normal situation for Congress, they are continuing to take more from the federal workers.  The first pay raise they would have seen in three years was killed by Congress.  This is on top of the fact that almost every government employee is facing a mandatory furlough of 11-22 days.

Furloughs are not vacation days as some people are saying.  These are days when workers are forced off from work and are not paid.  For those people who are being forced to take a 22 day furlough, that is a 12% reduction in pay, or in more simple terms, a loss of one month of pay (over the next six months).

This continuing resolution does absolutely nothing to stop the sequester cuts.

“I remain deeply dissatisfied that sequestration is not addressed and will slash the very priorities I believe all of us came here to fulfill,” said House Appropriations Committee Ranking Member Nita Lowey, D-N.Y. (GovExec.com)

As I said before, a full government shutdown is the worst possible thing for federal employees and the entire United States.  The fact that we almost shut down in 2011, cost us in our national credit rating.

The sequester cuts have already started to have an impact on business.  According to the Huffington Post and the AP, workers are being laid off already.

  • On Monday, 250 workers at the Hanford Nuclear Reservation in Washington state received pink slips, while another 2,500 others found out they’re facing furloughs. Approximately 9,000 people work at the nation’s most contaminated nuclear site, and the Associated Press reports that “cleanup is likely to be slowed” because of the budget cuts.
  • Continental Maritime, a contractor that repairs U.S. Navy ships, expects to lay off 185 employeeseffective April 12. Other contractors have issued conditional layoff notices — meaning that jobs are safe if Congress restores some funding to the Defense Department — to thousands of employees.
  • Four-hundred eighteen contract workers tied to the Tobyhanna Army Depot in Pennsylvania are losing their jobs due to sequestration. Two-hundred sixteen people will be dismissed on April 15 and 107 on April 30, the Morning Call of Allentown, Pa., reports. The paper noted that the Tobyhanna Army Depot is losing 35 percent — $309 million — of its government funding through the end of the fiscal year, and that more than 5,100 of the people who work there are being forced to take 22 furlough days.
  • At least eight municipal employees in Monterey County, Calif., are losing their jobs as a result of a decrease in the number of military contracts.
  • In early March, 23 people who work with the parks and recreation and maintenance departments in Tooele County, Utah, were laid off in order to grapple with the federal budget cuts. “I have four kids. This is my livelihood,” said Scott Chance, a 12-year employee. “It pays my health insurance. It gives me my house.”
  • Engineering Services Network is an engineering and technology company and one of the top Latino-owned companies in Virginia. President and CEO Raymond Lopez Jr. told NBC Latino that he has “lost about 20 employees through sequestration.”
  • The Red River Army Depot in Texarkana, Texas, announced in February that it was cutting 414 jobs — about 10 percent of its workforce. “I don’t know how we’re going to make it,” Raymond Wyrick, whose last day was scheduled to be March 9, told CNN Money.

Someone please tell me: how is preserving these sequester cuts in the continuing resolution going to help our economy?  How is cutting services, cutting personnel, and cutting families’ income helping our economy? Federal workers are already at the mercy of Congress. On top of sequestration, this continuing resolution that keeps the 0.5% raise off the table is just another slap in the face to federal workers.

Federal workers are not a piggy bank that Congress can turn to, every time it wants help balancing the federal budget.

There are other options.  Ending special corporate tax breaks would pay for the sequester cuts twice over.   Ending tax breaks on unearned income would pay for the sequester cutsplus everything the House GOP wants to cut from next year’s federal budget.

Hungry like a (baby) wolfRemember, too, that maintaining the sequester cuts means that 600,000 young children from low-income families are losing the free food they had been receiving through a U.S. government nutrition program.

Smack down federal employees (again) and take food away from hungry children.  Is this the best six-month budget that our Congress can come up with?   

Who’s counting? Corporate tax breaks are almost twice the Sequester cuts

US CapitolTax lobbyists help businesses reap windfalls: While Congress fights over ways to cut spending and the deficit, generous breaks for corporations pass with little notice

Today’s Boston Globe looks at the $154 billion a year that Congress has approved in special corporate tax breaks.

(Paying attention here? Those corporate tax breaks are worth almost TWICE as much as the infamous “Sequester” budget cuts.)

The Globe also begins to quantify the “return on investment” for corporate lobbying expenses. For instance,

  • Multinational corporations with overseas investments spent about $134.5 million lobbying on various issues. What did they get for their money? An estimated $11.2 billion, just in one tax break (special treatment of certain foreign investment income).
    Approximate return on investment: 8,200%

Here’s how one observer described it: “What we’re doing is running a Soviet-style, five-year industrial plan for those industries that are clever enough in their lobbying to ask all of us to subsidize their business profits.’’

It’s a long read, but worth taking the time. Read the story here. Dig into the graphic here.

Stopping Sequester Cuts Should Be Number One Priority In Washington Right Now!

Portsmouth Naval Shipyard 3Every day that goes by brings us one step closer to the Sequestration cuts that nobody wants. Yet nobody can seem to stop them though many are trying.  Everyone agrees that allowing sequestration to happen would send America down the wrong path and would result in a loss of millions of jobs in both the private and public sectors.

“Prof. Stephen Fuller of George Mason University concluding that sequestration budget cuts would cost 1.05 million jobs from spending reductions at domestic agencies and 1.09 million jobs from Pentagon spending.” (GovExec)
(emphasis added)

These cuts will hit us right here in New Hampshire.  This would mean drastic cuts to the Portsmouth Naval Shipyard.  Recently Senator Jeanne Shaheen and Senator Collins released a statment on how these cuts would effect the workers at the PNS.

“The measures the Navy announced include a civilian hiring freeze, cutting temporary workers at shipyards and base operating support facilities, reduced funding for critical repairs, and a possible 22-day furlough of civilian Naval employees. As Shaheen and Collins say in their letter, these cuts “would have severe ramifications for many critical defense facilities, including our own Portsmouth Naval Shipyard.”

“The Navy’s announcement underscores just how unacceptable automatic sequestration cuts are not only to our national security but to our economy as well.  We need a comprehensive plan to rein in our debt and deficits but not in a way that puts our vital national security and economic interests at risk.  I’m disappointed that we missed an opportunity to work in this manner last year during the fiscal cliff negotiations but am hopeful that moving forward we can take steps to avoid the kinds of actions that the Navy announced,” Senator Shaheen said.

Senator Shaheen spoke to the Senate Armed Services Committee reaffirming the need for bipartisan support to end the Sequestration cuts. Shaheen raised particular concern over the impact sequestration could have on the country’s industrial base, citing the potential devastation on New Hampshire small businesses that constitute a core part of the national defense industrial base.

“When it comes to our budget we need a comprehensive approach that is fair and balanced with respect to cuts and new revenues,” Shaheen added. “I will do everything I can to be flexible about that and to be willing to look at all the options that we have to get a solution because this is not just about our military readiness and this country’s national security, it’s also about the future of the economy in this country.”

Senator Shaheen has been very vocal in her opposition to the Sequestration cuts and the inability of both the US House and Senate to pass a long term budget solution to this problem.

“The fact we have not [come up with a long-term solution] means each and every one of us in Congress should take a second look at what our jobs are in this body,” Shaheen said.

Unfortunately many of the GOP Congressional members are suddenly singing a different tune when it comes to Sequestration.  Durning the election season many of the GOP were against the cuts and now they seem to be throwing their hands in the air as if they cannot stop them.  Some have even suggested that these cuts are the best thing to get our national debt under control.

Both sides need to come together and stop these automatic cuts that will send our economy into a tailspin.  Millions of middle class Americans would be forced out of their jobs or forced to take almost a month off without pay.

Even a short term solution may be to late to stop job losses in the private sector.

“Even without sequestration, the country is slowly backing away from long-term investments that make it the global leader.” — Wes Bush, CEO and president of Northrop Grumman

All industries rely on the strength and security the Federal Government provides.  They need to know that their funding will continue or at least know what their funding will be over the next few years to plan for their own future.

Millions of jobs are on the line and we elected you to Congress to help create new jobs not destroy the good middle class jobs we already have.

How many times can the Republicans count the same money toward the budget?

  1. Back in 2001, the Bush Tax Cuts were supposed to be temporary. All the old tax laws were supposed to kick back in, starting in 2011. The fact that all those “old taxes” were going to come back into effect was what made the tax cuts “affordable”, back when Alan Greenspan was doing the math.
  2. Fast-forward to January 2013, as the federal government goes over the Fiscal Cliff. The Republicans finally agreed to some “new taxes” – even though the “new taxes” were less than one-third of the “old taxes” which had been “temporarily suspended” by the Bush tax cuts. (The 10-year cost of the Bush tax cuts was $2.2 trillion. The Fiscal Cliff deal was $617 billion over 10 years.)
  3. Now it’s March. House Budget Committee Chairman Paul Ryan just released his budget proposal. And gosh, there’s that money again — this time as “budgetary savings”. Here’s what The Hill had to say:

The Ryan budget counts the $600 billion in new tax revenue raised under the January “fiscal cliff” deal as budgetary savings. Ryan also counts hundreds of billions in additional revenue being raised due to rosier economic growth projections…

But wait. There’s more:

The budget would also cut the top individual tax rate from 39.6 to 25 percent as part of an overhaul of the tax code that would eliminate breaks within the system. Like last year’s budget, the overhaul would leave two remaining rates at 10 and 25 percent.

Are the Republicans still trying to increase tax revenues by cutting taxes on the rich?

Confused? Me too.

But here’s the most confusing thing. Ryan describes this as – direct quote, here – “A budget that addresses America’s needs.”

In order to address America’s needs, Ryan proposes to:

  • cut Medicare, Medicaid and other health care spending by $2.7 trillion over 10 years;
  • cut an additional $1 trillion from “other programs” including food stamps, student loans and federal employee pensions; and
  • add $500 billion to the Pentagon’s budget.

So… apparently, Paul Ryan thinks America needs a budget that increases spending on military contractors while cutting spending on actual citizens.

Meanwhile, around this great country of ours…

Sequestration cuts mean that 600,000 young children from low-income families are losing the free milk, fruits and vegetables they had been receiving through a U.S. government nutrition program.

It’s Lent, Rep. Ryan. Been to church lately?

Where your treasure is, there your heart will be also.”

Military contractors? or hungry kids? Where’s your tax money going?

 

Is there still a line between “government” and “business”?

I’ve been reading through that 2009 Interim Report to Congress about defense spending in Iraq and Afghanistan.  Of all the report’s conclusions and recommendations, here’s the kicker:

“The government still lacks clear standards and policy on inherently governmental functions.” 

In other words, we have gotten so used the government privatizing things that we don’t even stop to think about it anymore.

PBS Prisons for Profit

Click here to watch the PBS show “Prisons for Profit”

Holding people in prison.  Shouldn’t that be an inherently governmental function?  Why has it become a multi-billion dollar private industry, instead?

Taxation.  Shouldn’t that be an inherently governmental function?  Not if you have political connections.  Not if you live in Pennsylvania.  Or California.  Or Virginia.  Or Wisconsin.  (Or lots of other places here in the good ol’ United States.)

Eminent domain.  Inherently governmental?  Not since Kelo.  Just ask anyone standing in the way of the Keystone XL pipeline.

Criminal investigations, searches and seizures.  Inherently governmental function?  Not if you live in Arizona.  Or if your child goes to school there.

Counterterrorism?

War?

Where is the line?  Aren’t there still some things that are “inherently governmental” and should never be contracted-out to for-profit corporations?

And how much are they profiting, anyway?  In a 2011 survey, 63% of government contractors reported making profit rates of more than 5% of revenues (26% of the companies made more than 10% profit).

But it’s still supposed to be cheaper, right?  Another 2011 report found that government contractors pay their employees total compensation worth an average of 1.83 times more than what federal employees are paid.

How much money are we talking about?  It’s hard to tell.  Federal outsourcing was $500 billion a year in 2008.  Since then, the Obama Administration has saved taxpayer money by in-sourcing.

But look at the hoopla about Sequestration.  Remember that infamous George Mason University report calculating that the sequester would “cost the US economy 2.14 million jobs”?

That report was produced for the Aerospace Industries Association, which describes itself this way:

shapes public policy that ensures the US Aerospace, Defense and Homeland Security Industry remains preeminent and that its members are successful and profitable…

AIA lobbyingThe AIA has been investing a lot of money lately, to ensure that its members are successful and profitable.  (Read more here.)

And Rep. Hal Rogers’ bill to avoid a government shutdown?  Looks to me like that was crafted to protect government contractors from the effects of sequestration – at the expense of federal employees and programs for the poor.

Just where IS that line between “government” and “business”?

Does it even still exist?

Fund the Government?
House GOP protects corporate interests, instead

budget_cutsThe House has passed a bill to keep the federal government from shutting down on March 27th.

According to Appropriations Committee Chairman Hal Rogers, the bill:

  1. provides $2 billion more than the President requested for non-war Defense funding – as well as an additional “$87.2 billion for Overseas Contingency Operations (OCO) for Defense activities related to the Global War on Terror.”  It also includes $521 million more than the President requested for defense technologies research and development.
  2. includes “a provision allowing additional funding to ensure the safe and secure operation of Federal Prisons.”
  3. requires “Immigration and Customs Enforcement to sustain the mandated capacity of 34,000 detention beds.”
  4. extends the current pay freeze for federal employees.

Want to play connect-the-dots?

  1. Corporate profits of defense contractors are almost back to their pre-recession high.  Yet the defense industry “mobilized in a major way to stop the cuts to the Pentagon budget. The main thrust of the offensive has been a huge public relations campaign aimed at convincing Americans that the cuts would devastate defense contractors and the broader economy, causing the loss of about a million jobs.”  Connect the dots?   Chairman Rogers’ bill included defense funding levels that were higher than the President requested.  (For a sampling of how private contractors have wasted tax dollars, read the June 2009 Interim Report to Congress here.)
  2. The private prison industry didn’t actually feel the recession.  Contracting with the federal Bureau of Prisons is a growing business: up by almost 14% between 2010 and 2011.  Now check out the lobbyists: Corrections Corporation of America employed 33 different lobbyists last year.  (Geo Group had only four lobbyists; but one of them used to be Special Assistant for Legislative Affairs for President George W. Bush, so he probably knows a few people.)  Connect the dots?   Chairman Rogers’ bill provides “budget security” for federal prisons.
  3. And then there’s immigration.  Ever notice how – even though seven out of 10 Americans want there to be an easier path to citizenship – that idea hasn’t actually gotten very far in Congress? Ever wonder why Congress set a minimum number of ICE “detention beds”?  Just follow the money.  Private prisons spend $45 million on lobbying and rake in $5.1 billion for immigrant detention.  The industry invests in campaign contributions to key legislators.   Connect the dots?  Last month, sequestration cuts prompted ICE to release low-risk detainees from custody, dropping the number of detainees to less than 31,000.   Chairman Rogers’ bill requires ICE to resume paying for all 34,000 detention beds.  (And BTW, the cost of a detention bed is comparable to many hotel rooms.)
  4. And then there’s the pay freeze for federal workers.  (Are we ever going to have an economy that works for the 99%?)  Here’s the reality that most of us have known our entire working lives: productivity has skyrocketed, while our wages have remained relatively flat.  Growth of real hourly compensation for production/nonsupervisory workers and productivity, 1948–2011. Economic Policy Institute
    Ever since Richard Nixon was President, economic growth has been transformed into corporate profits rather than increased wages.  How does the 1% keep that trend going?  By pitting workers against each other.  By telling us to consider ourselves lucky to even have a job.  By breaking union contracts, cutting benefits and implementing pay freezes.  This move is straight out of the ALEC playbook.  Connect the dots?  Chairman Rogers’ bill extends the federal employee pay freeze and, by maintaining the sequester, mandates unpaid furlough days – guaranteeing that federal workers will be losing ground on wages, just like the rest of us.

Yep, the House GOP still thinks they were elected to protect corporate interests.  Nope, they still don’t care how their budget will affect America’s families.  Bottom line: this budget reflects the priorities of the House GOP.

Where your treasure is, there your heart will be also.”

(Where can hungry five-year-olds find a good lobbyist?)

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