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Legislation Department
February 5, 1999

Impeachment Trial

In a series of votes, with senators crossing party lines, the Senate refused to subpoena Monica Lewinsky to appear in person but authorized the playing of a videotape of her recent deposition. Nearly half of the Republican senators joined their Democratic colleagues in barring her appearance, essentially destroying the House Republican managers’ attempt to prolong the impeachment trial. Majority Leader Trent Lott (R-MS) announced that there will be up or down votes on the two articles of impeachment as early as Thursday of next week.

President Unveils New Budget

President Clinton sent an ambitious budget plan to the Congress, which calls for seizing upon the "historic opportunity" of record-setting surpluses to rescue Social Security and Medicare, as well as to increase domestic spending. Upsetting Republican leaders, the plan omitted any large, across-the-board tax cut called for by them.

Save Social Security and Medicare

The heart of the Clinton budget is his plan for allocating federal budget surpluses expected over the next 15 years. Over this time period, the Office of Management and Budget projects a total budget surplus of approximately $4.5 trillion. Of this, approximately $2.7 trillion will come from surpluses in the Social Security program. About $1.8 trillion will come from the non-Social Security portion of the budget. Clinton wants to use $2.76 trillion of the surplus (62 percent) to invest in the Social Security Trust Fund. About $700 billion (25 percent) of the new Social Security money would be invested in stocks. Together, these two initiatives would extend the solvency of the Social Security Trust Fund to the year 2055.

About $686 billion (15 percent) of the projected surplus would be used to ensure the continued solvency of the Medicare program through the year 2020.

In addition to Social Security and other retirement savings, the Clinton plan calls for the creation of new Universal Saving Accounts similar to existing 401(k) plans. About $536 billion (12 percent) of the surplus would be used to fund these new savings devices.

Boost in Spending

About $481 billion (11 percent) of the surplus would be used to cover a variety of domestic initiatives and an increase in defense spending. Highlights of the increase include a $965 million boost in spending for job training and adult literacy, $200 million to turn around ailing schools, $600 million for summer and after-school programs, new resources to increase standards for teachers, an increase in scholarships for those committed to teaching in inner-city schools or isolated areas, a large tax incentive to finance school construction, a broad tax credit for child care, an increase in the minimum wage, and more. The president again targets the tobacco industry for new revenues, including a 55-cent increase in federal cigarette taxes.

Big Surplus Causes Tax Cut Fever

Not yet declared Republican presidential hopeful and present House Budget Committee Chairman John Kasich (R-OH), on behalf of the House Republican leadership, called for using $743.3 billion in budget surpluses expected over the next 10 years for a 10 percent across-the-board income tax cut. The bill would reduce all of the existing tax rates by several percentage points each on a sliding scale so that the wealthy would receive a greater the tax cut. According to Citizens for Tax Justice, 62 percent of the proposed tax cuts would go to the top 10 percent of all taxpayers. For taxpayers making less than $38,000 -- a group that includes 60 percent of all taxpayers -- the average tax cut under the plan would be $99 a year, while the top one percent of taxpayers -- those making more than $300,000 -- would get a tax cut of $20,697 annually. The House plan is similar to the plan unveiled earlier in the Senate by Rod Grams (R-MN). Kasich said he hopes the 10 percent tax cut plan can be approved by Congress this year. President Clinton and Democratic congressional leaders said they would fight the leadership plan.

Social Security

The House Ways and Means Subcommittee on Social Security held the first in a series of hearings focusing on the impact on workers from the GOP proposals to privatize the Social Security program. This week’s hearing focused on how a system of individual private investment accounts would affect women in their retirement years.

Witnesses told the subcommittee members that women as much as men could be adversely affected by changing Social Security to a system where workers would divert all or part of their Social Security payroll tax deductions into private accounts which would not be guaranteed and would be subject to the risks of the stock market. Women often make fewer contributions into Social Security because they typically spend less time working and earn less than men. Women already receive lower Social Security benefits than men. In December 1997, the average retired female worker received $662 a month compared with $860.50 for men. On average, older women rely on Social Security for 72 percent of their retirement income.

Patients’ Bill of Rights

Initial plans by the Senate Finance Committee to hold a hearing on the Patients’ Bill of Rights are now on hold and it is not clear when a hearing might be scheduled. However, Senate Majority Leader Lott has reportedly indicated that legislation could go to the floor in May, suggesting that any committee hearings held would need to be scheduled relatively soon.

Sens. John Chafee (R-RI) and Bob Graham (D-FL) are expected to reintroduce a managed care reform bill today, which is largely the same bill they introduced in the last Congress. Like their previous bill, the new bill also lacks whistleblower protection for health care workers.


Corrections took a hit in President Clinton’s FY 2000 budget proposal. The president eliminated a $750 million state prison grant, a $523 million law enforcement grant, and a $250 million juvenile justice grant. These cuts help pay for the president’s $1.28 billion 21st Century police initiative, which funds efforts to put 100,000 new police officers on the street, as well as new prosecution and prevention programs. AFSCME will be fighting to restore full funding for state and local prisons.

Minimum Wage

Efforts to increase the minimum wage by one dollar in two annual increases in the 106th session of Congress have gotten off to a good start. The House bill, H.R. 325, entitled the Fair Minimum Wage Act of 1999, currently has 100 cosponsors, all Democrats. In the Senate, the proposal to raise the minimum wage is contained in two bills. S. 8, The Income Security Enhancement Act, is a comprehensive bill which includes the Fair Minimum Wage Bill of 1999 and also addresses pay equity, Social Security, pension portability and the elimination of the "marriage penalty" in the tax code. S. 8 currently has eight cosponsors. S. 192 is a bill which just provides for the minimum wage increase and is identical to the House bill. S. 192 currently has 23 cosponsors, all Democrats.

Juvenile Justice

Senate Republicans have introduced juvenile crime legislation (S. 254) that would repeal existing protections for the tens of thousands of state workers who work in the court and juvenile justice systems. This legislation would eliminate a requirement that the distribution of federal funds to juvenile facilities not displace workers or negatively affect wages, or impair existing collective bargaining agreements. AFSCME has successfully defeated similar attacks in past years, and will make the defeat of this bill a top priority in this Congress.

Health and Safety Regulations

On Wednesday, February 3, the House Government Reform Committee passed a bill (H.R. 391) that would suspend the fines imposed on employers when they commit their first paperwork violation in the area of health and safety. This bill would make enforcement of critical health and safety regulations more difficult by eliminating the only mechanism to determine compliance. An amendment offered by Rep. Dennis Kucinich (D-OH) to delete some of the most objectionable provisions was defeated. The House is also preparing to take up legislation (H.R. 350) that would make it more difficult for Congress to pass important health and safety, environmental, and consumer safeguards.

Child Care and Head Start

The president’s budget included a major child care initiative which is similar to the one which he proposed a year ago but failed to win congressional approval. For FY 2000, the president proposes increases of $3.6 billion principally to expand the Child and Dependent Care Tax Credit and the Child Care and Development Block Grant and the 21st Century Community Learning Centers. The president proposes to increase the funds for Head Start by $607 million in 2000 and add 35,000 Head Start pre-school slots and 7,000 Early Head Start slots.

Senate Democrats introduced S. 17, the Child Care Access Act, which is similar to the president’s proposal and would increase child care subsidies for poor children, provide tax relief to help low and middle income families pay for child care, increase after-school opportunities and improve the quality of child care services.

District of Columbia

The House Government Reform Committee approved a bill (H.R. 433) returning control over the District of Columbia’s day-to-day operations to the Mayor of the city. The measure would transfer authority over the city’s nine agencies from the Financial Control Board back to the mayor’s office.


The 2000 census would absorb most of the proposed 41.5 percent funding increase for the Commerce Department that is contained in Clinton’s budget request. To comply with the January 25 Supreme Court ruling barring the use of statistical sampling for apportioning House seats among the states, the administration has proposed collecting two sets of census figures, one based on a traditional head count and another based on sampling.

Higher Education: State Guaranty Agencies

As expected, Clinton’s budget reduces funding for the state guaranty agencies which administer the Federal Student Loan program. The budget proposal would recall an additional $1.6 million in guaranty agency reserve funds, over and above those included in existing statute. It also accelerates the recall of reserves by $165 million in 1999 and 2000. The budget would also reduce agency retention on post-default collections from 24 percent to 18.5 percent and eliminate the ability of agencies to recoup their five percent co-insurance via post-default collections. The impact of all these reductions is to reduce the income to the guaranty agency to perform its functions.

Africa Trade Bills

The House Ways and Means Trade Subcommittee approved, 14-0, H.R. 434, a measure sponsored by Rep. Philip Crane (R-IL) which would extend NAFTA-style trade terms to the sub-Saharan African countries. H.R. 434 is the latest in a series of attempts to change the rules of trade to benefit multinational investors at the expense of workers in the United States and abroad. On the same day, Rep. Jesse Jackson, Jr. (D-IL) introduced an alternative African trade bill. Jackson’s proposal, The HOPE for Africa bill, would better ensure that workers in the Sub-Saharan countries would benefit from expanded trade without hurting workers in the U.S. Secretary-Treasurer William Lucy spoke at the press conference held by Jackson announcing the HOPE for Africa bill