Bush budget puts Social
Security, jobs, programs at risk
By SHERRY HALBROOK and JOHN MURPHY
Some PEF members could lose their jobs if President George W. Bush’s
record-setting $3.1 trillion federal budget proposal is enacted.
Your future Social Security benefits are endangered by the proposal. You
would have to start paying income taxes on your health benefits. And you can
also forget about the new program to forgive public employees’ student
Bush would cut state and local aid and other services by $19 billion for
federal fiscal year (FY) 2009, which starts October 1, 2008.
The budget includes deep cuts to funding for employment services, education,
health care, transportation, housing, Medicare and Medicaid.
“If we don’t stop this train wreck before it’s passed and implemented, we
could lose a significant number of public-sector jobs here in New York
State,” said PEF President Ken Brynien. “PEF will fight it, with the help of
our international affiliates.”
Bush is making a final, major effort to privatize the Social Security
system. He would spend $30 billion in FY ’09 and $647 billion over the next
10 years to create Social Security private accounts.
“Our members need to know they can count on Social Security to be there for
them when they are too old to work,” Brynien said. “They do not want to risk
that security in the uncertainties of the stock market.”
Bush also would cut or eliminate other programs on which many vulnerable
Americans rely, such as food stamps, nutrition programs, affordable housing,
But he would cut taxes by $2.4 trillion primarily for the wealthiest
Americans, and he would make permanent the 2001, and 2003 tax breaks
(scheduled to expire soon), which primarily benefit the richest 5 percent of
Currently, employer-provided health insurance is a
tax-free benefit to employees.
The president would tax you on what your employer pays for your benefits
above an annual deduction of $7,500 for individuals and $15,000 for
Bush would cut funding drastically for both of the top federal health care
programs – Medicare and Medicaid.
Federal Medicare (health insurance for older Americans) funding would drop
by more than $178 billion over the next five years.
Bush would shift $18.1 billion in Medicaid costs to state and local
government budgets over five years.
Cuts to Medicaid (for poor and low-income Americans) include: $5.5 billion
for administration; $3.3 billion for family planning services and supplies;
and $1.1 billion for targeted case management.
He would eliminate Medicaid funding for transportation and other supports
for school-based services, cap payments to government providers, and cut
Bush would expand tax subsidies for health savings accounts by $11.5 billion
over 10 years.
“Unfortunately, the subsidies encourage employers to drop their group
coverage,” Brynien said.
Bush would eliminate the entire Community Services Block Grant, which
currently provides $654 million for community action agencies that
administer Head Start and provide housing, nutrition, education and job
services to low-income people.
Bush would decimate employment and training programs. These cuts jeopardize
some PEF jobs at the state Labor Department.
Employment and training programs are cut by 29 percent.
Workforce Investment Act (WIA) funding for employment and training would be
cut by $484.4 million.
Bush would replace WIA individual training accounts with vouchers capped at
$3,000 for each of two years.
The state would be required to kick in a 20 percent funding match for
employment and training programs.
A $169 million increase is proposed for state unemployment insurance (UI)
Bush would permit privatization of UI functions, let states use private
collection agencies to recover UI benefit overpayments and waive civil
service merit standards.
Bush would restrict eligibility for the new student-loan-forgiveness
program, for employees who have been in public service for 10 years, to
loans made in 2009 and after.
He would cut student-loan bank subsidies by $18.8 billion over five years.
He would boost funding for Pell Grants by $2.6 billion.
The president would eliminate Supplemental Educational Opportunity Grants,
the Perkins loan program, and the Leveraging Educational Assistance Program
• Transportation – Mass transit funding cut by $202 million and highway
funding cut by $1.8 billion.
• Security – Funding cut for security at ports, rail and mass-transit. State
and local Homeland Security grants are reduced.
• Justice – Funding cut by more than 65 percent for key Justice Department
programs that fund state and local governments.
• Housing, community development – Funding for the Public Housing Operating
Fund boosted by $100 million, but the Public Housing Capital Fund is cut by