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Tax Cuts, Unemployment Insurance and Jobs

On December 17, 2010, President Obama signed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, which provides vital tax relief and investments in our workers that will create jobs and accelerate economic growth.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 provides vital tax relief and investments in our workers that will create jobs and accelerate economic growth. The bill has three key accomplishments:

Working families will not lose their tax cut. A typical working family faced a tax increase of over $3,000 on January 1. That’s avoided under this bill, and working families won’t see their tax cuts go away next year.
Focused on high impact job creation measures. The bill includes some of the best measures for jumpstarting growth and job creation, including a full year of emergency unemployment insurance benefits, a 2 percent payroll tax cut for working families and a continuation of tax credits for working families. This is on top of growth generated by extension of the middle-class income tax rates. Without action, UI benefits for at least 2 million Americans would disappear this month alone, with millions more in jeopardy in the weeks ahead.
Does not worsen the medium- and long-term deficit. These are responsible, temporary measures to support our economy that will not add costs by the middle of the decade. The President does not believe it is affordable to make the high-income tax cuts permanent and will continue to make his case for why we cannot extend these measures beyond 2012.

Wins for Working Families

Tax Credits Framework Chart

As the chart above demonstrates, the bipartisan agreement we’ve forged delivers several key victories – victories that will give the average American family assurance that there will be more money to pay the bills each month:

An Employee-Side Payroll Tax Cut of Approximately 2%: The agreement includes an employee-side payroll tax cut for over 155 million workers – providing tax relief of about $112 billion next year.

Extension of Unemployment Benefits: The agreement extends emergency unemployment benefits at their current level for 13 months, preventing an estimated 7 million workers from losing their benefits over the next year as they search for jobs.

The Child Tax Credit: The $3,000 refundability threshold established in the Recovery Act for the Child Tax Credit will be extended under the agreement, ensuring an ongoing tax cut to 10.5 million lower-income families with 18 million children.

The Earned Income Tax Credit: The agreement continues a Recovery Act expansion of the Earned Income Tax Credit worth, on average, $600 for families with 3 or more children, and reduces the “marriage penalty” faced by working married families. Together, these enhancements to the EITC will help 6.5 million working parents with 15 million children.

The American Opportunity Tax Credit: The new American Opportunity Tax Credit – a partially refundable tax credit that helps more than 8 million students and their families afford the cost of college – would be continued under the agreement.

100 Percent Expensing: The agreement includes the President’s proposal to temporarily allow businesses to expense 100% of their investments in 2011, potentially generating more than $50 billion in additional investment in 2011, which will fuel job creation.

1603 Renewable Energy Grants: The agreement extends the 1603 program, which is helping to support tens of thousands of jobs in the wind and solar industries.

These victories all come on top of the extension of lower income tax rates for middle-class Americans.

Published on The Nation (http://www.thenation.com)

Hands Off Social Security

Bernie Sanders | September 30, 2010

A White House deficit commission is reportedly considering deep benefit cuts for Social Security,

including a steep rise in the retirement age. We cannot let that happen. The deficit and our $13

trillion national debt are serious problems that must be addressed, but we can and must address

them without punishing America's workers, senior citizens, the disabled, widows and orphans.

First, let's be clear: despite all the right-wing rhetoric, Social Security is not going bankrupt. That's

a lie! The truth is that the Social Security Trust Fund has run surpluses for the last quarter-century.

Today's $2.5 trillion cushion is projected to grow to $4 trillion in 2023. The nonpartisan

Congressional Budget Office, experts in this area, say Social Security will be able to pay every

nickel owed to every eligible beneficiary until 2039. Got that? In case you don't, let me repeat it.

The people who have studied this issue most thoroughly and have no political bias report that

Social Security will be able to pay out all benefits to every eligible beneficiary for the next twentynine

years. It is true that by 2039, if nothing is changed, Social Security will be able to pay out only

about 80 percent of benefits. That is why it is important that Congress act soon to make sure Social

Security is as strong in the future as it is today.

The hatred of Social Security from the right-wing antigovernment crowd is based on the fact that

Social Security, a government program, has been enormously successful in accomplishing its

mission. For seventy-five years, in good times and bad, Social Security has provided financial

security for tens of millions of Americans.

Despite this outstanding record, Social Security has become a political football. For ideological

reasons, some in Congress believe that government should not be in the business of providing

benefits to seniors or the disabled. They want to privatize Social Security. Others say, incorrectly,

that Social Security is going bankrupt, so benefits should be reduced and the retirement age set at

70. I strongly disagree with both assertions.

While the critics profess concern about Social Security's financial future, their fuzzy math ignores

the fact that this highly successful program has not added a dime to our deficit. From the day when

the first check landed in the Ludlow, Vermont, mailbox of retired legal secretary Ida May Fuller on

January 31, 1940, Social Security has more than paid for itself.

With regard to the future of Social Security, there are some really dangerous ideas out there, and

one proposal that makes a lot of sense.

One of the worst ideas is to privatize Social Security. After the greed and recklessness of Wall

Street caused markets to collapse in 2008, does anyone still seriously believe it would be a good

idea to turn the retirement security of millions of Americans over to Wall Street CEOs whose

dishonesty and irresponsibility have no end? Their administrative fees alone would take a 15

percent bite out of workers' retirement investments, not to mention the real threat of another stock

market collapse. In sharp contrast, administrative costs for Social Security are less than 1 percent of

the program's budget. Most importantly, despite economic conditions and the ups and downs of the

stock market, Social Security has never failed to pay full benefits to every eligible beneficiary.

Another horrible idea is to move the retirement age up to 70. That would cheat today's young

workers out of about 15 percent of their retirement benefits over a lifetime. The proposal also

ignores the reality that millions of workers in demanding professions simply cannot continue to

work until they are 70. The upshot for them would be reduced lifetime benefits for retiring "early."

Lower-income workers, those less likely to have other savings, would be hurt the most.

In the midst of all of the destructive rhetoric and ideas out there with regard to Social Security,

there is one proposal that is simple, sensible and would keep Social Security strong and solvent in a

fair and just way. Under the law today, the Social Security payroll tax is levied only on earnings up

to $106,800 a year. That means millionaires and billionaires get off scot-free on all of their income

above that amount. In other words, an individual who earns $106,800 pays the same Social Security

tax as a multimillionaire. That's wrong. Applying the Social Security payroll tax on those with the

most income, say over $250,000 a year, would correct this inequity. According to CBO, applying

the tax to all income would provide all the revenue that Social Security needs for the foreseeable

future—for our kids and grandchildren and great-grandchildren.

As we mark the anniversary of Social Security, now is the time to pat ourselves on the back for a

job well done. For seventy-five years, Social Security has lifted millions of people out of poverty

and has provided stability and dignity for the elderly and for other vulnerable Americans. Our goal

today must be to make sure that Social Security will be as strong and stable seventy-five years from

now as it is today.

Source URL: http://www.thenation.com/article/155097/hands-social-security

No Relief in Sight

The Editors | August 12, 2010

How bad is it out there? Even a cursory scan of the news paints a grim picture of an America on the

brink: broken roads, crumbling bridges, dimmed streetlights, shuttered clinics and scrapped school

programs. Everywhere one turns, the nation's basic infrastructure—built in the twentieth century to

connect communities and care for the sick, the young and the old—is being abandoned, as if there

were not enough workers to keep it up. Yet the exact opposite is true: more than one in ten

Americans are out of work, and more than half of those have been unemployed for more than six

months.

Even the normally inflation-obsessed Fed, worried that the economy is headed into a deflationary

spiral, bought billions in Treasury securities to keep money flowing through the financial system.

But monetary policy can only do so much. The short-term solution to the crisis is obvious: get cash

pumping through states and cities to create and preserve jobs. So too are the obstacles: a

breathtakingly cynical GOP hellbent on opposing anything that might improve the economy—in

the hopes that voters will blame Democrats in November—and an ill-timed, baseless bipartisan

hysteria over deficits.

There is no clearer sign of the poisonous environment created by these factions than the battle to

pass a $26 billion package to help states and local governments make Medicaid payments and

avoid laying off 140,000 teachers. The only way Senate majority leader Harry Reid was able to

break a Republican filibuster was with offsets, largely through—if you can believe it—$12 billion

in cuts to food stamps. Reid had to table his initial proposal to cut "only" $6.7 billion in food

stamps because the Congressional Budget Office (CBO) said the bill would still add $4.9 billion to

the deficit. Only by nearly doubling the food stamp cut were Democrats able to win the votes of

Republican Senators Olympia Snowe and Susan Collins.

The political calculus is stunning. More than $1 trillion for the banks? No problem. But $10 billion

for teachers and $16 billion to help the poor get healthcare? Only if it's deficit-neutral and offset by

other cuts to social spending. Never mind that many people using food stamps are already living

through a depression or that food stamps are one of the most reliable ways to stimulate spending.

The food stamp lobby doesn't have quite the same pull as the Chamber of Commerce or US

corporations—which have seen their profits rise by 36 percent this year and enjoy profit margins as

a share of GDP that are near postwar records.

With this kind of downsized politics, many good proposals are left foundering. Take the

infrastructure bank proposed by Michael Lind and Sherle Schwenninger of the New America

Foundation and championed by Congresswoman Rosa DeLauro. By investing private and public

funds in America's roads, rails, electrical grid and telecommunications systems, an infrastructure

bank would create the jobs Americans so desperately need; as Washington Post columnist Harold

Meyerson points out, infrastructure is "the investment with the highest multiplier effect." It's also

the first move in restructuring the economy so that it's more stable and productive and less at the

mercy of financial bubbles and busts. This kind of long-term rewiring will also require more

progressive taxation to reduce gilded-age inequality and strengthen labor protections for workers.

But when the CBO, centrist deficit hawks and obstinate Republicans call the shots, it seems the

chances for good proposals like these are slim to none.

Source URL: http://www.thenation.com/article/154021/no-relief-sight

WHY GREEN JOBS SHOULD BE UNION JOBS (BY Joe Uehlein)

Courtesy www.aflcio.com

The union movement has worked hand in hand with allies in the environmental and social justice movements and others to push for “green jobs” that help reduce the carbon emissions that threaten our planet. Now we need to explain to them why those green jobs should provide the freedom to form a union, why our alliance should encourage workers in green jobs to form unions and why it should help us make employers recognize and bargain with them. Here are some of the reasons we can use to appeal to allies and the public, based on our report, "Why Green Jobs Should Be Union Jobs."

Empowering environmental guardians on the job. Workers have a strong stake in making their workplaces safe from environmental hazards and in protecting their communities and the wider world from workplace-originated pollution. But in workplaces without union rights and representation, workers are often intimidated from raising such concerns—the rule is likely to be “shut up or get fired.” Workers with union protections have often served as the eyes, ears and voice of the community in the workplace.

Countering unilateral corporate power. Protecting the public interest is hard work primarily because of the enormous power exercised by corporate private interests.Unions are perhaps the single most powerful countervailing force, helping redress the imbalance between corporations and the public in the political arena.

Rebuilding strong communities and the middle class. The expansion of green jobs is likely to be at the center of any effort to counter the erosion of good jobs and job standards that has decimated the American middle class. With help and inspiration from labor-backed groups like Green for All, union training and recruitment programs are already creating pathways out of poverty for people in America’s most deprived urban and rural areas.

Training the green workforce. Even though millions of workers are unemployed and looking for work, the emerging green industries are full of bottlenecks because of the shortage of workers with the right training. Unions are already playing a significant role in recruiting, training and placing workers in those jobs. In existing jobs, properly trained workers are crucial to avoiding poor practices that harm the environment; unions are a key source of pressure to ensure adequate training in environmentally sound practices.

Greening the labor movement. Organized labor has become an enthusiastic advocate for green jobs. But expanding green jobs depends on strong environmental policies that require companies and governments to make the shift to a low-carbon future. Creating a broad swath of union membership that depends on green jobs will provide a strong voice for pro-environment policies in the labor movement.

Strengthening the labor-environmental coalition. Nothing could do more to strengthen labor’s commitment to its alliance with the environmental movement than concrete evidence that greening grows labor’s ranks. When organized labor sees the value of that alliance, it can deliver real results. The joint union-community campaign to clean up the Los Angeles ports has led to a major reduction in greenhouse gas emissions by one of California’s leading polluters; labor’s commitment was greatly strengthened by a joint community-labor strategy that would make it possible for port drivers to join a union.

Corporate accountability and transparency. Unions control large pension funds and they have increasingly been using their investments to demand socially responsible policies. Increasing union membership will increase labor’s ability to help demand corporate social responsibility and transparency.

Building a more democratic society. The effort to build a sustainable world is only likely to succeed if it is part of a broad, multifaceted movement that addresses a wide range of the issues that touch people’s lives. Whether it is universal health care, protecting the environment or ensuring justice on the job, people need a broad alliance that can move society in a more progressive direction. The rapidly expanding green sector is a crucial place to start.

Ensuring green jobs are good jobs. What are touted as green jobs can all too easily instead be minimum wage jobs with poor working conditions without job security or benefits. The surest way to see that green jobs are good jobs is for workers to organize in unions that can bargain with their employers to ensure appropriate standards on the job.

A union brings collective bargaining, democracy on the job, protections for whistle-blowers, rising standards of living, a stronger tax base for the community and much more. Overall, the standards unions negotiate help build communities up. The economic impact for the family and the community are clear.

If labor’s allies want the benefits of green jobs to be sustained, they should help make sure that green jobs are union jobs.

Joe Uehlein is the executive director of Labor Network for Sustainability.

May 5, 2010

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