Schakowsky issues progressive deficit plan

SchakowskyPlan

A congressional progressive, arguing that the national debt cannot be eliminated without solving the unprecedented jobs crisis in America, issued a counter-plan to that advocated by the presidential deficit commission.

Rep. Jan Schakowsky, D-Ill., herself a member of the president's deficit commission, unfurled a plan on cable TV Nov. 16 that would reduce the deficit by $427.75 billion in 2015. Her plan would surpass Obama's $250 billion target and is designed to bolster rather than penalize the country's working-class majority.

In a bold way the Schakowsky plan addresses the jobs crisis, which the debt panel co-chairs' plan released last week failed to do.

Her proposal  raises taxes on the rich, preserves Social Security benefits that are currently paid out and calls for a $200 billion stimulus to create jobs.

The plan also achieves $110.7 billion in defense spending cuts by slashing unnecessary weapons systems, reducing troop levels and a variety of other measures.

Unlike the commission leaders' plan, hers taxes companies that outsource jobs and taxes corporate capital gains and dividends the same way regular income is taxed. The Schakowsky proposal also raises revenue by letting the Bush tax cuts expire for the rich on Dec. 31.

The congresswoman's long standing as a member and leader of the Progressive Caucus with strong ties to labor and civil rights organizations is quickly giving her plan major credibility.

A third plan released today by Alice Rivlin, another commission member, goes in the opposite direction, cutting even more services and programs than does the Simpson-Bowles plan. While the Rivlin plan provides more in "savings" than the draft proposal from the panel's chairmen it more severely cuts and limits the future growth of Medicare and Medicaid and reduces future retirees' benefits except for the lowest income people. The plan cuts $1 trillion from domestic programs between now and 2020.

Advocates of a path to deficit reduction that doesn't ignore the jobs crisis are among those who have already praised the Schakowsky plan.

"This is a serious proposal, and should be given as much consideration as the Bowles-Simpson plan," said the Wonk Room's Pat Garofalo. "Schakowsky has shown that it is feasible to balance the budget without blowing a huge hole in discretionary spending and she does it while also taking into account the threat of climate change and the revenue cap-and-trade can generate."

The Schakowsky plan includes the raising of $52 billion by implementing a cap and trade system.

On the same day that Schakowsky released her plan, Leo Gerard, president of the Steelworkers union, strongly condemned the report put forward last week by the chairmen of the president's commission.

He called it a "Saturday night special pressed to the temple of the American middle class. Turn over your money and your benefits or your country will die. You gotta delay retirement, get less from Social Security, pay more for health insurance and give up your precious few income tax breaks like the one that helps you pay your mortgage."

Gerard continued, "The deficit, the Social Security shortfall, difficulties with Medicare - they could all be solved if the nation returned to taxing policies that existed under Republican President Dwight Eisenhower." He noted that taxes on the rich fluctuated between 81 percent in 1940 and 70 percent when Ronald Reagan began slashing them in 1980.

The congresswoman's plan includes a proposal to bring the public option back into the health care reform law which, by itself, would cut the deficit by $17 billion.

It brings $132 billion into the Treasury from increased taxes corporations would pay.

When she released her plan Schakowsky said the Bowles-Simpson proposal "would have serious consequences for lower and middle-class Americans, and that is why I cannot support it. I am releasing my own plan today because I believe there is a better way to achieve our goal - one that protects the poor and the middle-class."

Image from Rep. Schakowsky's official website.

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  • Doesn't her bill contain cap and trade? If so, it must be deleted. Cap and trade results in another "deriviative" market. Corporations sell or buy their rights to pollute to other corporations resulting in continued pollution and another derivatives scandal. There's already trillions of dollars in real estate mortgage derivatives that the working class is stuck with.

    Posted by Butch, 11/27/2010 5:54pm (3 years ago)

  • Corporations don't pay taxes.

    When corporations are taxed they simply add this to
    their cost of providing services or products, and

    ONLY THE PEOPLE PAY THEM!!

    Posted by jane abbott, 11/24/2010 8:27pm (3 years ago)

  • I have seen the plan. It is a responsible one and deserves very serious consideration, as it moves us forward toward the goal we must achieve, while minimizing negative collateral impacts.

    Posted by Rev. Larry Murphy, 11/19/2010 4:35pm (3 years ago)

  • Great reporting.

    Cold as it is in Chicago, we need to get out on the street to fight for Schakowsky's pro-people deficit easing plan. Organizing the unemployed to put up an organized fight for survival can create a massive force that will help progressives turn things around. Schakowsky's budget plan gives us the direction we need to go.
    infolvent

    Posted by Beatrice Lumpkin, 11/18/2010 10:41pm (3 years ago)

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