A 'People's Budget' That Invests in Jobs
By Raul M. Grijalva, Mike Honda and
Special to CNN
April 14, 2011
is co-chairman of the Congressional Progressive Caucus.
U.S. Rep. Mike Honda, D-California, is a member of the
president of the Economic Policy Institute.
(CNN) -- Despite a weak economic recovery and
persistent, unacceptably high unemployment,
is prematurely pivoting from job creation to deficit
reduction. Worse yet, many of the budget proposals
plans to redistribute wealth from working families to
the most privileged among us.
Last week, House Budget Committee Chairman Paul Ryan,
R-Wisconsin, unveiled a reckless budget that includes a
plan to privatize Medicare by forcing recipients to buy
insurance on an open market, where premiums have more
than doubled over the last 10 years, to gut Medicaid by
shifting costs to states and reducing funding, to cut
taxes on corporations and wealthy individuals and to
reduce the nation's ability to make needed investments
by capping overall levels of federal spending.
This plan would undermine economic growth and job
creation for years and exacerbate ever-widening income
inequality. Instead of these reckless cuts, job
creation and strengthening the economic recovery must
be our priority.
It is our obligation to the American people to address
our long-term fiscal challenges without sinking the
economy back into recession, further undermining the
struggling middle class, or stripping investments that
pave the way for long-term growth and American
competitiveness in the global economy.
Members of the Congressional Progressive Caucus,
supported by technical assistance and analysis from the
Economic Policy Institute, have proposed a progressive
budget that paves the way for robust job creation as an
alternative to Ryan's austerity-focused plan.
Ryan's budget places the burden of deficit reduction on
the backs of working-class Americans while financing
tax cuts for the wealthy and favors to powerful special
The "People's Budget" would create jobs and invest in
long-term growth, investing $1.7 trillion in job
creation, infrastructure, education and scientific
research and development over a decade. The most
effective path for deficit reduction is to dramatically
reduce unemployment and get Americans working in good
jobs, earning more and paying taxes.
This budget does that. The People's Budget also
strengthens Social Security by raising the taxable
maximum to include 90% of economy-wide earnings and
eliminating employer-paid caps on their high-income
Together these policies would maintain the solvency of
Social Security, without any reduction in benefits, at
least 30 years beyond current projections. It also
secures access to affordable health care by adding a
competitive public option and negotiating drug prices
with big pharmaceutical companies resulting savings of
nearly $250 billion over a decade.
The budget would responsibly end the wars in
the Defense Department. The budget makes targeted
public investments, but cuts overall spending by $1.7
trillion over a decade.
It requires corporations to pay their fair share by
eliminating taxpayer subsidies to oil and gas companies
and closing international tax loopholes that deprive
the United States of jobs, investment and revenue. It
taxes exotic and risky Wall Street financial
instruments to curb speculation and recovers the costs
of the financial crisis.
The budget restores fairness to the tax code by asking
more from those who can afford to pay more. Instead of
cutting taxes for the wealthiest Americans, the budget
raises taxes on those who have seen most of the income
gains over the last decade by adding new tax rates for
millionaires and billionaires. The budget taxes
investment income as wage income, ending an unfair tax
system that taxes income from wealth at lower rates
than the wages of teachers and nurses.
The People's Budget offers a credible way to balance
the budget within a decade without engaging in any
Fiscal responsibility does not require gutting social
programs and public investments that promote economic
security and generate growth. Instead, it requires
standing up to the powerful lobbies whose special
interests are not in our national interest and
abandoning unfair tax policies that favor the wealthy
These policies more than achieve long-term
sustainability by slowing health care, bringing the
budget to surplus within a decade, and bringing debt
down below a sustainable 65% of the economy. A budget
is more than a mathematical exercise; it is the most
definitive embodiment of our national values.
We believe the People's Budget reflects the values of
the population at large rather than the interests of
lobbyists. The budget deficit is not an excuse to wage
ideological war against government and the social
programs that have delivered economic security, health
and progress for the better part of a century. We have
an obligation to rebuild a stronger
opportunity and economic security for all.
The opinions expressed in this commentary are solely
those of the writers.