Harsh and Unbalanced

Dec 20, 2012

By Elizabeth Lower-Basch

Update:  On the evening of December 20, Speaker Boehner pulled his "plan B" from the House floor, as he did not have the votes to pass it.  HR 6684 passed on a 215 to 209 vote, withi no Democrats voting for it, and 21 Republicans voting against.  It is not clear whether Boehner will now attempt to resume negotiations with President Obama.  We will provide updates when more information is available.

In less than two weeks, a combination of expiring programs, automatic spending cuts, and tax increases, popularly called the "fiscal cliff," is scheduled to take effect.   This week, Speaker Boehner appears to have abandoned attempts to come to agreement with the President on a comprehensive package to prevent this.  Instead, he is expected to bring up for a vote in the House of Representatives two proposals, together which would slash spending, particularly on programs that serve low-income individuals, in order to preserve tax breaks for the wealthy and defense spending. Adopting these proposals would be significantly worse than heading off the "fiscal cliff."

The first bill, Boehner's "Plan B," is a tax-only bill, that would raise taxes only on income above $1 million a year - and for the lowest income households.  The plan would also raise taxes by an average of $1,000 on 25 million working households with children and students. "Plan B" does not include any of the improvements made to the EITC, the Child Tax Credit (CTC) or the AOTC in 2009.  A single mother with two children working full time at the minimum wage and would face a reduction of about $1,447 - or 86 percent - to $248 in her child tax credit. Meanwhile, the top 0.3 percent of households with incomes over $1 million would get tax cuts averaging $50,000 per year.  This bill would allow federal extended Unemployment Insurance benefits to expire, and would leave "sequestration" - indiscriminate across the board spending cuts to both military and domestic discretionary spending - in place. 

The second bill, HR 6684, is a new version of the "Sequestration Replacement Act" that the House passed in May.  This would avert the automatic cuts for defense programs, but would add deep new cuts to critical human needs programs including the Supplemental Nutrition Assistance Program (SNAP, or food stamps), Medicaid, and the Child Tax Credit.  It would also completely eliminate the Social Services Block Grant, which provides funding for child care, child welfare and elderly services programs,  In May, we described this bill as "harsh and unbalanced" and the pairing of this with tax increases to low- and moderate-income families makes it doubly so.

The votes on these bills could come as early as 6 pm today (Thursday, December 20).  Contact your Representative and tell them to vote NO on both bills.  We need a balanced long-term approach to deficit reduction that does not target the most vulnerable or send us back into recession.

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