AFT LEGISLATIVE ALERT

The Importance of the 2006 Midterm Elections

With the 2006 elections almost here, it’s important to consider how they may affect your life and the lives of the 1.3 million AFT members in the next two years. No matter what you think of my views, I urge you to participate in these elections.

Your voice and vote must be heard.

Bill Cunningham
Senior Associate Director
AFT Federal Legislation

• Iraq
• Budget and Tax Policy
• Social Security
• Medicare

Iraq
The Iraq war is going very badly. Civil war has broken out, forcing the president to banish the phrase “Stay the course.” Unfortunately, this rhetorical sea change seems to have had little effect on the way he is conducting the war.

Iraq has had the most direct impact on the families and friends of the more than 2,800 servicemen and women who have been killed there, and the thousands of wounded veterans who will require care in the future. Not to mention the tens of thousands of Iraqis killed and wounded, and their families and friends. The conduct of the war has seriously damaged U.S. standing in the world, and has made it harder for our nation to win support in addressing serious problems in Afghanistan, Iran and North Korea, to name only a few critical international hot spots.

So far, the federal government has spent over $336 billion on the Iraq war, and outlays increase every day. In addition, knowledgeable observers in Congress now estimate the cost of treating soldiers wounded in Iraq at $1 trillion over the next 10 years.

Subsequent events have discredited the initial justifications for the war—i.e., the existence of weapons of mass destruction, the presence of al Qaeda in Iraq, and the assertion that Iraqi oil would pay the cost of rebuilding that nation. Yet Congress, under Republican leadership, has neglected its responsibilities in overseeing the conduct of the war and its consequences. For this reason, one of the most significant outcomes of this fall’s election—if either or both houses change hands—will be increased congressional oversight. Over 60 percent of the American people feel that the war is going badly. But Congress to date has played no role in evaluating the war’s consequences because Republican leaders in the House and Senate have squelched any effort at oversight. This is wrong and should be changed.

Before you vote, ask your candidate what he or she will do to assure the new 110th Congress will exercise its constitutional duty to oversee the Iraq war.

Budget and Tax Policy
The federal budget is out of control. With the congressional budget process gridlocked by years of one-party decision-making and strong-arm tactics, the FY 2007 budget, which should have been in place on Oct. 1, has yet to pass. But the real story is not about process but consequences. In 2001, the Congressional Budget Office projected a surplus of $5.6 trillion for the next 10 years. For a variety of reasons, that surplus has become a $3.3 trillion deficit. The major causes of this disastrous turnaround are the war in Iraq, the war on terrorism (homeland security) and the tax cuts. Yet the White House has made no effort to pay for these. The president and Republican-led Congress have simply declared Iraq, Afghanistan and the revenue lost to tax cuts “off budget,” as if this spending does not count.

Congress, often along party lines, passed appropriations and tax bills without the money to pay for them, and as a result the federal budget is swimming in red ink. The geometric increase in “legislative earmarks” (pet projects in the members’ home states or districts) added to this debacle by ballooning and distorting annual appropriations that fund most of our domestic programs.

This year’s federal deficit—when you subtract the Social Security surplus that minimizes the amount of red ink—will be well over $500 billion.

This hemorrhaging can be stopped by adopting pay-as-you-go or “pay-go” rules requiring that all new entitlements (mandatory spending like Medicare, Medicaid and Social Security) and new tax relief bills be offset by either increasing taxes, closing tax loopholes or cutting other entitlement programs. The Democratic House and Senate leadership have pledged to enact these pay-go rules as the first order of business if they are elected to lead the new Congress. This change would actually be a return to rules in place during the 1990s, and is a primary reason why the budgets at the end of that decade were balanced and produced the first budget surplus in decades. Re-establishing pay-go rules would be an important step in regaining control of the federal budget. Why is this important? The federal government’s ability to fund essential programs such as Social Security and Medicare, help pay for education, contribute to state programs, and fund national defense and homeland security depends on a return to fiscal responsibility. A lower federal debt will reduce our dependence on foreign nations to buy U.S. Treasury bills, which finance our federal debt. Thus, our increasing debt has foreign policy as well as domestic economic consequences. The continuation of recent record deficits will directly threaten key domestic programs and our standing in the world.

A good example of how the new pay-go rules would work is the effect they would have on the proposed repeal of the federal estate tax. This repeal would cost the federal government $1 trillion over the next 10 years and help only a few, very, very wealthy people. But under pay-go rules, supporters would have to find the funds to pay for this excessive tax break.

Question your candidates carefully on their plans for developing and adhering to a responsible federal budget and for reducing the deficit over time. These essential changes will directly affect your situation and that of your children and grandchildren. Don’t settle for short-term answers; the real problems with the White House’s current fiscal policy come after 2010.

Social Security
Perhaps the biggest change, if there is a change in congressional leadership, will be in programs of special interest to retirees: Social Security and Medicare.

In the House, continuing control by the Republican majority will make Rep. Jim McCrery (R-La.) the new chair of the Ways and Means Committee, which has jurisdiction over Medicare and Social Security. Rep. McCrery has announced his intention to press for a new attack on Social Security and its guaranteed benefits by reintroducing the idea of private accounts. On the Senate side, the chair of the Senate Finance Committee, Charles Grassley (R-Iowa), announced that in the next Congress his committee also will look at Social Security financing and directly address the issue of private accounts.

A change in party control would make Rep. Charles Rangel (D-N.Y.) chair of the House Ways and Means Committee and Sen. Max Baucus (D-Mont.) chair of the Senate Finance Committee. Both strongly support maintaining and strengthening the existing Social Security system. Both would address the long-term funding of Social Security but oppose the privatization of Social Security.

Medicare
A change in House leadership would have the greatest impact on Medicare. Should the Democrats win control of the House, Nancy Pelosi (D-Calif.), who would be the new Speaker, has already promised early action on an AFT retiree priority: amending the law to allow Medicare to negotiate prescription drug prices. As most of you know, the existing Medicare law explicitly prohibits this negotiation. This restriction was placed there by House and Senate Republican leaders to help a very powerful lobby: the drug companies.

The Veterans Administration currently negotiates prices and saves up to 40 percent on prescription drugs. Allowing Medicare to negotiate drug prices should produce similar results, and the savings could be used to reduce or eliminate the coverage gap or “doughnut hole” that affects millions of Medicare drug beneficiaries.

In addition, Democratic leadership in the House and Senate would work to assure that Americans of all ages have the opportunity to purchase prescription drugs from Canada or other industrialized nations—an opportunity Republican leaders have denied by blocking the vote in both houses of Congress.

The 110th Congress will take up a number of other issues important to AFT members:

• Reforms and changes in the No Child Left Behind law;
• Cuts in reimbursement for healthcare coverage under Medicare/Medicaid;
• Federal programs that help fund state budgets (31 percent of current state budget
  funding comes from the federal government); and
• Assistance to students and families in paying the cost of higher education.

The war in Iraq and the treatment of the federal budget will remain key to the election outcome. I believe that AFT members will be better served by a change in the majority of both the House and Senate.

But your choice is the one that counts. Whatever you choose, please vote on Nov. 7.

To help evaluate your members of Congress, check the 109th Congress AFT Voting Record to see where they stand on important issues.