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Fed unions reject push for 'grand bargain' cuts

Federal employee unions last week condemned the rising post-election chorus in Washington for a "grand bargain" to reduce the federal deficit and avoid the so-called "fiscal cliff."

Federal employee unions last week condemned the rising post-election chorus in Washington for a “grand bargain” to reduce the federal deficit through measures that would trim billions of dollars from the federal budget—including cuts to Social Security and federal employee compensation—to avoid the so-called "fiscal cliff."

Many Republican lawmakers have emphasized their support for such cuts throughout the two years of this Congress—an approach most famously outlined by House Budget Committee Chairman Paul Ryan (R-Wis.) in his “Path to Prosperity” budget plan, also known as the “Ryan Plan.”

But now, with lawmakers from all parties facing a second recession if they fail to head off the coming fiscal cliff, federal employee unions are pressing the president and Democrats on Capitol Hill not to soften their resistance to deep program cuts, because of the inevitable effects those cuts would have on the federal government’s own employees.

The ‘fiscal cliff’

Despite the rising tide of red ink, many in Congress for years have resisted efforts at adding revenue—as many Democrats and even the bipartisan Bowles-Simpson commission’s plan have proposed—by increasing taxes on high earners and others.

But if, by Dec. 31, 2012, Congress and the White House cannot agree on a means to reduce the budget shortfall, about $100 billion per year will be removed from the budget “automatically” by way of cuts and tax increases. The across-the-board budget cuts would put additional pressure on a federal workforce that already has been affected by a two-year pay freeze.

The wide-ranging basket of tax increases and cuts in programs and entitlements would kick in on Jan. 1, 2013. Since going over the fiscal cliff would destabilize the economy, most observers expect lawmakers to engineer a last-minute swerve away from the cliff’s edge before the deadline. Unions, for their part, are strategizing to make sure that the complicated negotiations which lead to that expected last-minute swerve don’t sacrifice the interests of federal employees.

As part of those negotiations, numerous labor leaders reportedly met with the administration at the White House last week. Among those present were Richard Trumka, president of the AFL-CIO, as well as Lee Saunders of the American Federation of State, County and Municipal Employees, which represents feds at the Library of Congress, the Department of Justice, the Department of Agriculture, the Federal Aviation Administration, the Peace Corps and other agencies. Also meeting with administration officials were Max Richtman of the National Committee to Preserve Social Security and Medicare and other liberal-leaning groups. A number of top business CEOs met with the White House at a separate meeting.

Unions push back

“The president and Congress have a great deal on their plate with the sequestration deadline approaching so quickly,” National Federation of Federal Employees President William R. Dougan said in a statement. “We’re reaching out to as many elected officials as we can to explain just how devastating an effect this would have on federal employees. This is our No. 1 priority right now. We cannot allow sequestration to happen.” 

National Treasury Employees Union President Colleen Kelley sounded a similar note.

“It would be harmful to our nation if federal employees and their agencies are looked to for further cuts, including higher contributions to employee pensions and severe budget cuts, in light of the significant contributions they already are making,” Kelley said.  

The American Federation of Government Employees noted in a statement issued after the election that those aiming to close the budget gap exclusively by way of cuts are pulling out all the stops in their efforts to lobby Congress and influence the public—including launching new lobbying groups that oppose any tinkering on the revenue end of the equation.

AFGE characterized such efforts as “repackaging the Romney tax plan,” which the union said would shift the burden away from the “wealthiest 2 percent” and onto an already badly burdened middle class, including federal employees.  

"The American people rejected this tax plan on Election Day," AFGE president J. David Cox said. "They said 'no' to eliminating the mortgage interest deduction and having to pay income taxes on the value of employer-sponsored health insurance. They said 'yes' to tax fairness, including plans to restore Clinton-era tax rates to high earners, unearned income and corporate profits”

Avoiding a ‘grand bargain’

“AFGE has been coordinating with the AFL-CIO in a range of activities,” Jacqueline Simon, public policy director for the union, told FEND. “We are making sure that any so-called ‘grand bargain’ that people are talking about doesn’t end up involving any cuts to Social Security or Medicare benefits—and that it doesn’t ask for any further cuts from federal employees.” 

Simon—echoing statements issued by her union—slammed various parts of proposed cuts that would harm feds. She noted that with the fiscal cliff looming, there are those on the Hill pushing to cut Social Security benefits, raise the retirement age for Social Security, reduce the cost of living adjustments to those benefits, “voucherize” Medicare, and even add three more years to the federal pay freeze.

“All these proposals are part of the Ryan budget [plan]—which we oppose,” Simon told FEND. “We are not resigned to any further cuts. Events will dictate what we do next. We are lobbying lawmakers, we are lobbying the administration, talking to the press, doing all we can.

“We’ve already given over $103 billion over a 10-year span,” Simon explained, referring to the long-term costs of the pay freeze and other cuts. “In fact, we’re the only group of Americans who have given at all, and it’s time to look elsewhere for any cuts.”

Simon clarified that she doesn’t believe that the White House has weakened in its support of federal employees now that the election is over.

But she also noted that the Obama White House’s own budgets have included some heavy sacrifices for federal employees—from imposing the pay freeze to calling on feds to pony up 2.3 percent more toward their retirement benefits. Furthermore, the White House has announced it will delay the end of the pay freeze until April 2013—at the earliest.

In light of those facts, AFGE and other unions have stiffened their stance.

“We are adamantly opposed to any more cuts for us,” Simon said. “Not another dime.”


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