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Vol. 75/No. 8      February 28, 2011

Bipartisan budget axe
takes aim at workers
(front page)
Announcing a five-year freeze on "all discretionary spending outside of security," U.S. president Barack Obama presented a federal budget February 14 that is part of the bipartisan drive to cut social spending in order to reduce the ballooning government debt and protect payments to the wealthy bondholders.

Democrats and Republicans alike are committed to war spending. The Obama budget calls for $671 billion in military spending over the next year, including $118 billion for the wars in Afghanistan, Pakistan, and Iraq. The U.S. government currently spends almost as much on military outlays as all other countries in the world combined.

The war against working people at home is also projected to be well funded. The Department of Homeland Security's budget will increase. The number of Border Patrol agents will climb to an all-time high of 21,370, reflecting "the largest deployment of law enforcement officers to the front line in the agency's history," said the department. New York City alone will receive an additional $41.2 million to "fight terror."

According to the Washington Post, half of all government agencies, however, would see their budgets reduced. The five-year freeze on domestic programs, if enacted, would reduce spending in real dollar values to its lowest level since 1961 when President Dwight Eisenhower left office.

The Low Income Home Energy Assistance Program, which provides heating aid, would be cut by $2.5 billion. Community development block grant programs that renovate housing for low income workers would be cut by $300 million. Housing construction for seniors and those with disabilities would receive $172 million less. Pell grants, for students who need financial aid to attend school, would be terminated for those taking summer classes.

Obama said his budget proposals "would mean cutting things that I care deeply about. But if we're going to walk the walk when it comes to fiscal discipline, these kind of cuts will be necessary."  
Unemployment remains high
Meanwhile, the White House announced that official unemployment will remain high. It estimates a 9.3 percent jobless rate for the rest of this year and projects slower economic growth than was originally forecast. Under the proposed budget a Labor Department plan to employ older workers would be chopped in half. The budget cuts come on top of an already announced two-year pay freeze for more than 2 million civilian federal workers, and a second year in a row halt to any cost-of-living increase for Social Security recipients.

President Obama and Vice President Joseph Biden met with Republican leaders John Boehner and Kevin McCarthy February 9 about the budget proposals. After the meeting Boehner said, "We were able to find enough common ground, I think, to assure the American people that we are willing to work on their behalf and willing to do it together."

Republicans had earlier submitted a "Pledge to America," vowing to make deeper cuts and restore spending levels to what they were in 2008.

The New York Times noted, "The point of Mr. Obama's forecast is less to promise a specific result than to signal to voters and financial markets that he is serious about reducing annual deficits."

Whatever bipartisan budget is eventually passed, it will be aimed at deepening the assault on working people, as the capitalist class and its government tries to get workers to go along with the "tough choices" for years to come. Obama says the budget cuts are just "a down payment" on what will have to be done to secure the fiscal health of the country.

Both the Democrats and Republicans continually point to the need for substantial cuts in Social Security, Medicare, and Medicaid. All the while, wealthy bondholders received almost $170 billion in interest payments in the 2011 fiscal year.

In addition to federal budget cuts, workers across the country are facing sharp attacks on the state level—many of the deepest assaults at the hands of Democratic governors. In New York, newly elected Democratic governor Andrew Cuomo is proposing to close the state's $10 billion budget gap with cuts to Medicaid and education. California governor Edmund Brown, also a Democrat, aims to cut wages for all nonunion state employees by 10 percent and spend 20 percent less on higher education funding.
Related articles:
Thousands protest Wisconsin budget cuts  
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