In the wake of President Obama’s State of the Union assessment that the economy of the future will require strong federal government action now, the battle lines are being drawn.
Senate Democrats came out swinging Jan. 26 against a GOP budget plan they said risks the loss of 1 million jobs.
They argued that GOP plans to cut $4 billion in business loans would cost 161,000 jobs, that eliminating federal support for Amtrak would cost 160,000 jobs and that choking off funds for health care reform could slash 400,000 jobs.
In a special report the Democratic Senators issued in response to a proposal from the conservative Republican Study Committee, the lawmakers also said 4,000 FBI agents, 3,000 food safety inspectors and 6,000 nuclear safety workers would lose their jobs, endangering national security, if the GOP plan were adopted.
At a Capitol news conference Democratic Sens. Charles Schumer (N.Y.), Dick Durbin (Ill.) and Patty Murray (Wash.) said the plan would “shut down the country’s economic growth.”
“What I have heard from the Republicans is disconcerting,” Murray said. “They want to have a fire sale. They want to sell off our country.”
The fight back by the senators followed passage of a resolution by the Republican-controlled House a day earlier calling on Budget Committee Chairman Paul Ryan (R-Wisc.) to instruct the House appropriations subcommittees to cut their budgets to 2008 levels or below.
The battle intensified just as the Congressional Budget Office provided ammunition for the President in the debate over spending and size of government.
The CBO blamed the record $1.5 trillion deficit on December’s tax deal, which extended the Bush-era tax rates for two years and will add almost $400 billion to the deficit, bolstering President Obama’s argument in the State of the Union address that those serious about deficit reduction would not extend tax cuts for the richest tax payers.
In his speech the President pushed hard for modernizing the nation’s infrastructure, including the construction of high-speed rail transportation networks.
Almost immediately, supporters of high-speed rail projects cautioned that the inspiring vision of a modernized transportation network laid out by the president is threatened by proposals to freeze or cut federal spending.
“High speed rail networks do not materialize with the snap of a finger,” wrote Tom Philpot for the Grist. “They cost money. Public money.”
By 2035 the high-speed rail project the president mentioned, linking San Francisco and Los Angeles could take 41 million people out of cars and generate $3 billion annually in income for the government. Under the president’s stimulus plan the government is kicking in $2.3 billion and California voters approved a $10 billion bond issue. “So that’s $12.3 billion of the $42 billion necessary” to build the project, Philpot noted
In an unusual move in support of the president’s call for infrastructure spending, the AFL-CIO, the nations largest labor federation, joined with the pro-business U.S. Chamber of Commerce in releasing a joint statement.
“America’s working families and business community stand united in applauding President Obama’s call to create jobs and grow our economy through investment in our nation’s infrastructure,” the statement read. It was issued Jan. 26 from the World Economic Forum in Davos, Switzerland where both AFL-CIO President Richard Trumka and Chamber President and CEO Thomas Donahue are attending.
“Whether it is building roads, bridges, high-speed broadband, energy systems and schools, these projects not only create jobs and demand for businesses, they are an investment in building the modern infrastructure our country needs to compete in a global economy.
“With the U.S. Chamber of Commerce and the AFL-CIO standing together to support job creation, we hope that Democrats and Republicans in Congress will also join together to build America’s infrastructure.”
Photo: Sen. Charles Schumer, D-N.Y., and Senate Majority Whip Richard Durbin of Ill., speaking out against a GOP budget plan they said risks the loss of 1 million jobs, Jan. 26, on Capitol Hill in Washington. (Charles Dharapak/AP)