‘PRESIDENT George W Bush wants to make sure his tax cuts for the wealthy become permanent, at a cost of about $3 trillion over the next 10 years’, said the AFL-CIO giant US trade union federation yesterday.
It added: ‘But to help pay for the huge tax cut, Bush’s Fiscal Year 2007 budget will slash $65 billion from health care, education, job training, low-income, food, child care and other domestic programmes that help families that aren’t so wealthy.’
AFL-CIO President John Sweeney commented: ‘At a time when the president is asking the nation’s vulnerable to swallow painful cuts to vital programmes, he continues to push for massive, fiscally irresponsible tax breaks for the wealthy that will leave generations of Americans in debt.’
Bush’s proposed spending cuts come just days after Congress finalised some $40 billion in Bush administration-backed spending cuts that will hurt working families.
And even as families mourn the deaths of 18 US miners in the past month, the Bush budget underfunds worker health and safety programmes.
Although the Mine Safety and Health Administration (MSHA) funding rose slightly (1.4 percent) since last year, the coal enforcement budget is down ten per cent in real terms since 2001.
Total MSHA full-time staff is down from 2,357 in 2001 to 2,136 in this budget.
Funding for the Occupational Safety and Health Administration (OSHA) remained flat compared with last year and is down three per cent since 2001. The number of full-time OSHA employees is down from 2,370 in 2001 to 2,173 in this budget.
‘This budget does little more than offer the status quo,’ says Senator Robert C Byrd (Democrat West Virginia). ‘Four years of budget cuts and four years of coal enforcement staff cuts are left in place,’ Byrd says. ‘Instead of offering significant resources to help make coal mines safer for the men and women who provide the power for this country, the Bush White House offers a band aid.’
Medicare, the federal health insurance programme for the nation’s elderly, is taking the biggest hit, with Bush proposing to slash the programme by $36 billion. Seniors would end up paying more for hospitals, doctors and other medical needs.
The Bush budget calls for across-the-board cuts in Medicare payments to medical providers who, likely, will pass those costs on to their patients and higher premiums for some seniors, including disabled patients.
Bush also seeks to cut Medicaid spending for low-income children, parents, seniors and people with disabilities by $17.6 billion over ten years – more than $12 billion in proposed regulatory changes and more than $5 billion in legislative changes, according to an analysis by the Centre on Budget and Policy Priorities.
Many of the changes to the Medicaid programme would shift costs to the states, with the result that many states will ‘reduce eligibility or scale back health benefits for low-income Medicaid beneficiaries,’ according to the centre’s analysis.
Other health-related budget cuts are aimed at the Centres for Disease Control and Prevention, the National Cancer Institute and the National Heart, Lung and Blood Institute.
The proposed expansion of Health Savings Accounts are a disaster for working families – they would shift costs from employers to employees and force many to go without needed care.
Meanwhile the official US unemployment rate released last month by the federal Labour Department is 4.7 per cent – but how accurate is that figure? asks the AFL-CIO.
It answers: ‘Not very, according to a new report by the Center for Economic and Policy Research (CEPR), which issued a new report that finds the nation’s unemployment rate could be as much as 1.4 percentage points higher – 6.1 percent.
‘That means there could be nearly three million fewer people working than the official numbers claim.’
The report, Missing Inaction: Evidence of Undercounting of Non-Workers in the Current Population Survey (CPS), says the CPS, a monthly survey conducted by the US Census Bureau for the Labour Department, overstates the employment rate by 1.4 percentage points for all workers and greatly undercounts the number of unemployed African Americans and Latinos.
‘This corresponds to roughly three million fewer people working, almost as big a drop in employment as in a typical recession,’ says John Schmitt, an economist for CEPR and main author of the report.
The CPS is based on answers to a monthly survey, but the report shows a large and growing portion of the population does not respond to the CPS, and that non-responders appear more likely to be unemployed than people who take the survey.
The CEPR’s report follows more confirmation that the jobs that have been created in the past four years, pay less than the jobs lost and that wages have slowed down and even declined.
The federal Bureau of Labor Statistics (BLS) reported January 31 that wages and benefits paid to civilian workers rose last year by the slowest rate in nine years and when inflation is factored in, overall compensation fell by 0.3 per cent, the first such decline since 1996.
Another study, The Role of Metro Areas in the US Economy, prepared for the US Conference of Mayors, shows new jobs created pay on average $9,000 less per year than the more than two million jobs that were lost.
The study found that the CPS overstates employment rates for blacks by about two percentage points, with the gap for younger African American men as much as eight percentage points higher.
The CPS also overstates employment rates of younger Latinas by about the same margin and younger Latino men by three to six percentage points.
