5 Cuts That Even Scrooge Would Make This Christmas Instead Of Punishing The Unemployed
In Charles Dickens’ A Christmas Carol, the reader is made aware of the limits of Ebenezer Scrooge’s generosity when the protagonist is approached by a portly gentleman who is raising funds for the unfortunate :
“At this festive season of the year, Mr. Scrooge,” said the gentleman, taking up a pen, “it is more than usually desirable that we should make some slight provision for the Poor and Destitute, who suffer greatly at the present time. Many thousands are in want of common necessaries; hundreds of thousands are in want of common comforts, sir.”
“Are there no prisons?” asked Scrooge.
“Plenty of prisons,” said the gentleman, laying down the pen again.
“And the Union workhouses?” demanded Scrooge. “Are they still in operation?”
“They are. Still,” returned the gentleman, “I wish I could say they were not.”
How cruel, the reader is supposed to think, to suggest punishing the poor for being poor — and on Christmas Eve!
Congress is about to make a million of the nation’s most unfortunate citizens a little more unfortunate by simply doing nothing. At the end of this month 1.3 million people — including 20,000 veterans — will lose their unemployment benefits as a federal program that extends coverage to those out of work for up to a year expires at a cost of $25 billion a year.
House Democrats have seen their attempts to continue the extension rebuffed by their Republican colleagues and are now using hearings to try to draw attention to the stories of those who will be cut off. This, unfortunately, will not likely be enough to convince Congress, which just let food stamp coverage shrink, to act.
Rep. Paul Ryan (R-WI), the chief budget negotiator for House Republicans, is attempting to refocus on “poverty,” according to recent reports in the press.
But for Ryan, helping the poor sounds suspiciously like punishing them.
“Paul wants people to dream again,” a Ryan advisor recently said. “You don’t dream when you’ve got food stamps.”
Apparently, starvation is better for dreaming.
How does Mitt Romney’s former running mate think the poor should be helped?
“You cure poverty eye to eye, soul to soul,” he said, during a recent speech at the Heritage Foundation. “Spiritual redemption: That’s what saves people.”
At the end of A Christmas Carol, Scrooge experiences spiritual redemption and decides he must help the unfortunate. But since Ryan’s spirituality owes more to Ayn Rand than Dickens, we can’t expect such an awakening for the House GOP. The long-term unemployed will be punished along with everyone else, as economic growth is reduced by an estimated 0.4 percentage points in the first quarter of 2014, destroying 310,000 jobs.
So if Republicans want $25 billion in cuts this year, here’s how they can get them without punishing those out of work during the holiday season.
Close Guantánamo Bay Prison — $37o Million
Closing Guantánamo Bay prison was a key promise in President Obama’s first term. And he signed an order to make that happen almost as soon as he became president.
But it didn’t happen.
“The problem is Congress, for three consecutive years, has denied the president funding to move the detainees from Guantánamo Bay,” said Scott Silliman, an appellate judge at the United States Court of Military Commission Reviews.
Critics point out that the president could return many of the prisoners to the countries of their origin on his own, a move that could end up with some “returning to the battlefield.”
However, the tide may be turning and it may soon become possible for the government to save $3.73 billion over 10 years by transferring the detainees to other federal prisons. Republican senators Rand Paul (R-KY), Jeff Flake (R-AZ) and John McCain (R-AZ) — who also promised to close the prison during his own presidential campaign — voted with Senate Democrats in November to make it easier for the president to close the facility.
Even without Congress’ help, if the president just transferred the 84 prisoners who have been cleared to be returned home, we would save $2 billion.
The $5 billion we’ve spent on Guantánamo has created a legal and logistical mess that symbolizes the failed paradigm of the War on Terror. If we’re ever to have any hope of rebuilding at home, this is the first step we should take.
End The Carried-Interest Tax Break — $11 Billion
Former Republican presidential nominee Mitt Romney’s low tax rate was the result of his generous giving to religious and charitable groups and what may be the most offensive tax break in the entire code — the “carried-interest loophole.” This intentional quirk in the law that allows certain investors to have all their income taxed as if it were capital gains, saving them about 19.6 percent on income over $400,000, is so inexplicable that it’s likely one of the reasons Romney never released his tax returns.
And because of the clout these private equity and hedge fund Masters of the Universe have in Congress, this economically useless giveaway will likely never go away. But if it did, we could be almost halfway to the $25 billion we need to help the unemployed.
“The difference in revenue to the United States government when this combined income is taxed at 20 percent rather than at 39.6 percent is about $11 billion annually,” wrote Lynn Forester de Rothschild, who as the CEO of E. L. Rothschild is eligible for the loophole. “Indeed, the Real Estate Roundtable, a leading industry lobbying group, puts the estimate even higher, at $13 billion — $5 billion in real estate alone.”
Photo: Adam Glanzman via Flickr
Smart Defense Cuts — $10 Billion
We’re saving billions by drawing down our presence in Afghanistan, possibly to zero U.S. soldiers.
But even if Republicans don’t want to count those savings to help those out of work, there are simple ways to cut back on defense spending without weakening our security, say The Center for American Progress’ Lawrence J. Korb, Alex Rothman, and Max Hoffman.
Last year they offered four ways for Congress to save $100 billion, enough to extend the unemployment benefits for four years, over the next 10 years:
—Eliminate the Navy’s buy of the over-budget F-35C jet and instead purchase the effective and affordable F/A-18E/F jet to save $16.62 billion over 10 years
—Reduce the size of our ground forces to their prewar levels to save $16.16 billion over 10 years
—Reform the Pentagon’s outdated health care programs to save roughly $40 billion over 10 years
—Reduce the number of deployed nuclear weapons to 1,100 by 2022 to save at least $28 billion over 10 years
Photo: DVIDSHUB via Flickr
Use The Money Republicans Turned Down For Medicaid Expansion — At Least $8.4 Billion
Currently 25 states led by Republican governors have turned down federal funding for expanding Medicaid, which would have covered 100 percent of the cost of extending coverage to those earning just over the poverty level. By doing this, they are driving up rates in their own state’s exchanges by 15 percent and sending billions back to the federal government that should be helping the unfortunate.
The RAND Corporation suggested that just 14 of these states—which include Texas, with the highest uninsured population in the nation—were turning down $8.4 billion in federal dollars.
But these aren’t the only health care savings that could be repurposed. The record slowdown of health care costs is steadily wiping out big chunks of the near-term deficit.
“Already, the Congressional Budget Office has quietly erased hundreds of billions of dollars from its projections,” The New York Times‘ Annie Lowrey wrote. “It now estimates that Medicare spending in 2020 will be $137 billion lower than it thought in 2010, a drop of 15 percent; Medicaid spending will be $85 billion, or 16 percent, lower; and private health insurance premiums are expected to be about 9 percent lower. ”
These projections assume the slowdown is temporary. If it isn’t, the savings may be $750 billion over 10 years. Enough to triple emergency unemployment benefits.
Photo: Gage Skidmore via Flickr
Just Use A Third Of The ‘Fiscal Cliff’ Savings — $73.7 Billion
Hopefully you’re part of the tiny percentage of Americans who know the deficit is falling faster than it has since after World War II. Much of this has to do with the marginal recovery we’re experiencing and a lot of it comes from ending the Bush tax breaks for the richest Americans at the beginning of this year.
“Allowing those tax cuts to expire, along with other savings in the fiscal cliff deal, reduced deficits by $737 billion over 10 years compared to what deficits would have been under current policy at the time,” The Center for American Progress’ Harry Stein noted.
We’ve already tripled the savings we’ll get from punishing the unemployed at Christmas. So how about we give them a little break? If Paul Ryan can’t ask himself what Jesus would do, maybe he can reflect on what Scrooge might — at the end of A Christmas Carol.
Offering a hand to the unfortunate may not help them dream. But it will help 1.3 million Americans and their families eat.
Photo: AFGE via Flickr