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Legislation Department
March 12, 1999

Republicans Warm to Budget Plan With New Tax Cuts, but Nothing for Medicare

House and Senate Republicans are beginning to line up behind a budget plan that calls for major reductions in domestic spending as well as new, far-reaching tax cuts, while at the same time attempting to protect the Social Security Trust Fund. The House budget plan calls for a new tax cut of $10- to $15 billion in the year 2000 and $800 billion over ten years. The Senate meanwhile is talking about tax cuts of between $15- to $25 billion in the first year. The GOP leadership budget plan not only would force big reductions in vital government spending programs, but it also does nothing to protect Medicare. In sharp contrast, President Clinton’s budget protects both Social Security and Medicare, setting aside 77 percent of any budget surplus for these two programs and using the remainder for new retirement savings accounts and new domestic spending. Also likely to be part of the GOP leadership budget will be a new round of increases in defense spending. Senate Budget Chairman Pete Domenici (R-NM) says he wants to increase defense by $8.3 billion.

The House and Senate by wide margins passed legislation that would give states greater flexibility in seeking waivers of federal education requirements.

Both versions of the legislation would expand to all states an existing 12-state waiver pilot program. States could apply for waivers to try new approaches implementing the Title I program for disadvantaged children, teacher training and a host of smaller programs.

The 98-1 Senate vote for the Ed-Flex bill (S. 280) came after a week of intense partisan fighting. Democratic amendments to provide funding to hire 100,000 new school teachers and for after-school programs were blocked largely on party lines.

The House passed a similar version of the bill (H.R. 800) 330-90 after defeating an amendment that would have limited states’ use of waivers under the Title I program. The measure now goes to a House-Senate conference panel which will iron-out the differences between the House and Senate bills.

The Senate Health, Education, Labor and Pension (HELP) Committee has scheduled a March 17 markup of S. 326, a managed care reform bill sponsored by all the Republican members on the HELP Committee. As introduced, the bill is nearly identical to the Republican Senate leadership bill, providing little in the way of meaningful reform and excluding whistleblower protection for health care workers who advocate for their patients and quality care. The Chair of the Committee, Sen. Jim Jeffords (R-VT) is working on some changes to the bill before it will be considered next week. However, it is unlikely that the changes will be substantial improvements.

Sen. Ted Stevens (R-AK) introduced the "Public Safety Medal of Valor Act" (S. 39) to provide a national Medal of Valor for public safety officers, including corrections officers, who act with extraordinary bravery above and beyond the call of duty. This legislation would establish a Medal of Valor Review Board, composed of 11 individuals appointed by Congress and the president, who would recommend to the president up to 10 candidates a year for this medal. The Public Safety Medal of Valor would be the highest national award for valor by a public safety officer.

Rep. John Tierney (D-MA), along with several others, introduced a resolution (H.Con.Res. 31) calling on the Capitol Police Board to designate one flag pole at the Capitol for the flying of a flag at half-mast whenever a federal, state, or local corrections or other law enforcement officer is killed in the line of duty. The flag would then be presented to the family of the slain officer.

The sound bites may have changed, but no real progress was made this week in the debate over how to strengthen Social Security. GOP congressional leaders still have not put a specific plan on the table. Last week, the GOP budget leaders were talking about walling off a portion of the surplus for Social Security in a "lockbox", but this week the House and Senate Republican leadership were saying that they would have a plan in the coming days which would mirror President Clinton’s plan to bolster Social Security by reducing the public debt. But, the devil is in the details and for now, that is missing. To date, the president’s proposal is the only defined plan to have been presented to the public.

The co-chair of the Bipartisan Commission on Medicare Reform, Sen. John Breaux (D-LA), cancelled this week's meeting of the Commission. Sen. Breaux has been unable to marshal the necessary votes for a Commission recommendation in favor of Medicare vouchers.

In the House of Representatives, over 200 Democrats signed a letter to Speaker Dennis Hastert (R-IL) asking the Republicans to use the surplus to save both Social Security and Medicare.

AFSCME joined with other coalition members in support of legislation providing permanent tax assistance for employer-provided education benefits under Section 127 of the Internal Revenue Code, and adding back coverage for graduate-level education as well. Testimony on behalf of the coalition of employer-employee groups was presented to the Senate Finance Committee in support of Senate legislation (S. 211), sponsored by Sens. William Roth (R-DE) and Daniel Patrick Moynihan (D-NY), Chairman and ranking member of the Finance Committee respectively.