What Do Obama, the ‘Gang of Six’, and Paul Ryan Have in Common?

by Jack Rasmus

Jack Rasmus

What do Obama, the Gang of Six, and House radical Teapublican, Paul Ryan, all have in common? They’ve all proposed a $4 trillion deficit reduction package. Does anyone think that is pure coincidence?

Obama’s tactical move today, July 19, along with the Senate Gang of Six, is to hitch his (and the gang’s) proposed $4 trillion proposed cuts to the current negotiations simultaneously going on between Reid and McConnell in the Senate to immediately cut spending by $1-$2 trillion in exchange for raising the debt ceiling.

Obama’s move shows clearly he does not want to take on deficit cutting piecemeal. He wants to get it all over at once and behind him before campaigning for 2012 begins in earnest. And he’s willing to offer big cuts in spending to get it done now, before the 2012 election cycle gets seriously underway after this summer.
Continue reading

Dean Baker: Statement on Gang of Six Plan

by Dean Baker

Dean Baker

The budget plan produced by the Senate’s “Gang of Six” offers the promise of huge tax breaks for some of the wealthiest people in the country, while lowering Social Security benefits for retirees and the disabled. Despite claiming that they will “reform” Social Security on a “separate track, isolated from deficit reduction,” the plan includes cuts to Social Security that would be felt in less than six months, as the plan calls for a new inflation formula that will reduce benefits by 0.3 percentage points a year compared with currently scheduled benefits. The plan also calls for a process that is likely to reduce benefits further for future retirees.

The proposed cuts to Social Security are cumulative. This means that after ten years, a beneficiary in her 70s will see a cut of close to 3 percent. After 20 years, the cuts for beneficiaries in their 80s will be close to 6 percent, while the reduction in annual benefits will be close to 9 percent by the time beneficiaries are in their 90s. For a beneficiary in her 90s living on a Social Security income of $15,000, this means a loss of more $1,200 a year in benefits
Continue reading

In the Ditch

Richard L. Trumka
President, AFL-CIO

photo by Dan O'Brien

When your car breaks down in a ditch and you need it to get to work, what do you do?

A. Fix it, even if you have to responsibly take out a loan—and work harder over time to pay off the debt, even if it means taking a second job.

B. Stay in the ditch, throw a tantrum and default on your mortgage.

The economy still is reverberating from the deepest financial crisis since the Great Depression. But rather than work to fix our economy, congressional Republicans are willing to keep it in a ditch.

Two leading Republicans—Rep. Eric Cantor (R-Va.) and Sen. Jon Kyl (R-Ariz.)—recently left budget negotiations and are threatening to force default on our national debt if they don’t get their way.

Tell President Obama and congressional Democrats: Stand up to bullies. Don’t let working families get stuck in a ditch.

Continue reading