AFL-CIO President Rich Trumka’s Statement on Obama’s Budget Proposal

The budget proposal President Obama offered to Republicans yesterday keeps faith with the voters in last month’s election, who overwhelmingly opposed tax cuts for the wealthiest 2% of Americans and benefit cuts to Social Security, Medicaid, and Medicare.

The ball is now in the Republicans’ court.  Unfortunately, Republicans do not seem to have learned the lessons from their shellacking at the polls in November.  They are still insisting on the very things voters rejected so resoundingly: tax cuts for the wealthiest 2% and benefit cuts to Social Security, Medicare, and Medicaid.

Let’s be clear on one point: there is no disagreement that more needs to be done to bring costs under control throughout our health care system.  The question is how.  The right approach is to make the delivery of care more cost-effective—for example, by allowing Medicare to negotiate lower drug prices with the big pharmaceutical companies.  The wrong approach is to simply shift costs to beneficiaries, which does nothing to control costs.  Any agreement on future budget savings in the health care area must protect beneficiaries from cost-shifting and benefit cuts.

The question now is whether Republicans will follow through on their threats to harm the economy if they do not get their way.  Republicans could easily avert the so-called “fiscal cliff” by agreeing to extend tax cuts for the middle class, continue unemployment benefits for another year, cancel the across-the-board budget cuts scheduled for January, and replace the expiring payroll tax cut with a refundable income tax credit.  But they prefer to hold the economy hostage because they think this gives them leverage to win the very things voters just got through rejecting: benefit cuts and tax cuts for the wealthy.

Republicans are overplaying their hand.  Unlike last year, Democrats now have all the negotiating leverage, and Republican hostage-taking threatens not just the economy, but the future of the Republican Party.  The question moderate Republicans should begin to ponder seriously is whether they will allow the dead-ender caucus to push their party over the “cliff” of political marginalization.

It is time somebody stood up to the Republican hostage takers.  Working families are telling Congress: no benefit cuts to Social Security, Medicare, or Medicaid and no more tax cuts for the wealthiest 2%.

The statement can also be found here