WASHINGTON – President Barack Obama’s proposed spending plan for the fiscal year starting Oct. 1 cuts the Department of Labor’s budget by $40 billion.

The President’s DOL blueprint is drawing a cool reception from Democrats opposed to any cuts but from Republicans too who worry that the cuts may not be as real as they look. Virtually all of the DOL cuts are in mandatory spending programs, such as jobless benefits. But regardless of budget projections the flow of money into that program is already determined, under the law, by the state of the economy.

Budget fireworks on Capitol Hill began even before the unveiling of the president’s spending plan, with the House set to vote during the week of Feb. 14 on a GOP plan that would slash $100 billion from money already allocated for this fiscal year.

Many Democrats are critical of the president’s budget because it reduces funds for programs for the poor, including aid to help low-income people pay their heating bills. The GOP is attacking the Obama budget for many reasons, including the fact that it does not slash Social Security, Medicare and Medicaid, it proposes increased spending for fast rail and, of course, because it is President Obama who proposed it.

AFL-CIO President Richard Trumka reserved comment on both the president’s proposals and the GOP alternative until his staff had a chance to comb through both.

But Obama Labor Secretary Hilda Solis said her department made some “tough choices” when faced with a presidential order to hold spending on non-mandatory programs – the Occupational Safety and Health Administration, payments to former nuclear power plant workers who have become ill and the Job Corps among them.

In just one example of the contrast between Obama’s budget and the Republican plan, the president wants to give OSHA $25 million more next year, upping the agency’s budget to $583 million. The House GOP wants to cut it this year, even before next year’s budget takes effect, by $99 million.

“Clearly, cuts will mean reduced services,” Assistant Labor Secretary for Employment and Training Jane Oates told a public web chat yesterday.

“This budget is based on our belief that to win the future, we cannot cut in a way that will undermine our ability to out-educate, out-innovate, or out-build our economic competitors,” Solis herself said.

“Many American workers, particularly those experiencing long-term unemployment need our help to obtain the skills and credentials for the jobs that will open up as the economy recovers. Our request is an investment in our future to train hardworking, unemployed Americans to upgrade their skills. We are committed to discovering programs that work best and providing resources to replicate them,” Solis said.

Besides the $25 million increase for OSHA, other Obama administration Labor Department proposals include:

*$46 million, up from $25 million this year, for a multi-agency initiative within the department to fund state grants “that address worker misclassification within the context of the unemployment insurance program.”

Worker misclassification, as independent contractors, is particularly rife in trucking, construction and food processing. It lets unscrupulous and venal employers escape paying Social Security, Medicare and workers comp for their workers – and classifying workers as “independent contractors” bars them from unionizing.

“This initiative will help level the playing field for employers who abide by the law and provide employees with their rightful pay and benefits,” DOL said. Wage and Hour Division assistant secretary Nancy Leppink added her agency would, as part of it, “enforce labor violations that result from the misclassification of employees as ‘independent contractors’ and to deter such violations in the future.”

*$860 million, down $1 million, for adult employment and training, targeted to low-income workers to get them into middle-class-paying occupations. The budget anticipates serving 6 million such workers next year, down from 6.95 million this year.

*$1.4 billion to retrain just over 1 million dislocated workers who lost their jobs due to plant closings and mass layoffs. That’s down $10 million – and 120,000 retrained workers – from this year.

*$1.67 billion to retrain workers who lost their jobs due to unfair competition from foreign imports. That’s down $147 million from this year’s actual spending.

*$23 million to give grants to states that adopt paid family leave laws. Obama proposed that last year, for this year’s spending – but with double the funds ($50 million). The then-Democratic-run Congress didn’t adopt it.

OSHA Administrator Dr. David Michaels said in the web chat his agency’s spending request includes money to work on new rules on combustible dust, infectious diseases, making walking and working surfaces safer, silica exposure and getting firms to communicate hazards to workers. He did not say what would happen if the GOP’s planned $99 million cut passed.


Mark Gruenberg
Mark Gruenberg

Award-winning journalist Mark Gruenberg is head of the Washington, D.C., bureau of People's World. He is also the editor of the union news service Press Associates Inc. (PAI). Known for his reporting skills, sharp wit, and voluminous knowledge of history, Mark is a compassionate interviewer but tough when going after big corporations and their billionaire owners.