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Feb 8, 2016

Top 400 Taxpayers See Tax Rates Rise, But There’s More to the Story

As Americans were gathering party supplies to greet the New Year, the Internal Revenue Service released their annual report of cumulative tax data reported on the 400 tax r...

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Feb 4, 2016

Chlorine Bleach Plants Needlessly Endanger 63 Million Americans

Chlorine bleach plants across the U.S. put millions of Americans in danger of a chlorine gas release, a substance so toxic it has been used as a chemical weapon. Greenpeace’s new repo...

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Jan 25, 2016

U.S. Industrial Facilities Reported Fewer Toxic Releases in 2014

The Toxics Release Inventory (TRI) data for 2014 is now available. The good news: total toxic releases by reporting facilities decreased by nearly six percent from 2013 levels. Howe...

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Jan 22, 2016

Methane Causes Climate Change. Here's How the President Plans to Cut Emissions by 40-45 Percent.

  UPDATE (Jan. 22, 2016): Today, the Bureau of Land Management (BLM) released its proposed rule to reduce methane emissions...

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House Budget Committee Passes Chairman’s Mark

The House Budget Committee passed the Chairman’s Mark last night on party lines, by a vote of 22-15. While the Chairman’s Mark calls for decreased spending on domestic programs, it actually increases rather than decreases the deficit over time, despite continued statements by Congressional GOP leaders that the deficit will be cut in half by 2009. The Center on Budget and Policy Priorities estimates the House Committee’s proposal would increase the deficit by $126.9 billion. This is largely due to the fact that tax cuts are included in the mark. The House budget proposal cuts programs $216 billion over five years; there are significant reductions in veteran’s benefits, environmental protection, and spending on education. At the same time it proposes increasing spending for defense and international discretionary programs by $202 billion. The House Budget Committee’s proposal also proposes deeper cuts to Medicaid than the President proposed in his budget. Although the Chairman’s Mark does not specify which mandatory programs should be cut, the Mark does instruct the Energy and Commerce Committee to make reductions of $20 billion over five years to programs under their jurisdiction, one of which is Medicaid. As this Center on Budget and Policy Priorities report states, “These Medicaid cuts are likely to push hard-pressed states to eliminate coverage for a substantial number of low-income people, increasing the ranks of the uninsured and the underinsured.” Even though national revenues are lower than they have been since the 1950’s, and are helping to build our record-level deficit, the Chairman’s Mark -- like the President’s budget proposal -- suggests passing new tax cuts. The proposal specifically calls for the passage of $106 billion worth of tax cuts over the next five years, and includes an extension of dividend and capital gains tax cuts, which were enacted in 2003 but are slated to expire in 2008. The benefits of these two tax cuts flow overwhelmingly to those with the highest incomes. $45 billion of those tax cuts were set aside to be protected under reconciliation instructions, which is smaller than the $70 billion the Senate endorsed to be protected under reconciliation. The House will more than likely move more than one tax bill this year however; one in the reconciliation process and likely another one outside reconciliation to make the 2001 and 2003 tax cuts permanent.

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Republican Opposition to Budget Proposals

Opposition to the outcome of yesterdays House Budget Committee markup started small and is growing significantly among House Republicans. The opposition began with a small group of Republican Study Committee leaders, including Rep. Mike Pence (R-IN), Jeff Flake (R-AZ), and Jeb Hensarling (R-TX). The Republican Study Committee is a House caucus of over ninety conservatives. Their opposition, which according to this article in The Hill has spread to over forty Republican representatives, is based in the fact that the leadership’s plan is “unenforceable because it does nothing to curtail House leaders' power to waive budget rules for legislation that violates the budget.” The Republican leadership – and especially Budget Committee Chairman Nussle (R-IA) – are worried these “rebels” will vote with the Democrats against the budget when it is brought to the floor next Wednesday. The RSC leaders have the support of many members of the “Tuesday Group,” which is a caucus of about thirty centrist House members. The Tuesday Group is chaired by Reps. Mark Kirk (Ill.) and Charles Bass (N.H.). Their coalition with the RSC is significant because together the membership of the two groups total nearly 120 GOP lawmakers. Their opposition to the budget blueprint put forth by Nussle has significantly spread beyond a few conservative leaders and members of the Budget Committee in the past two days, and is showing that the leadership’s insistence on unwavering support for the Chairman’s Mark have had little effect. Senate Republicans have also apparently been expressing concern about the budget proposals ahead of them. Today’s New York Times, reports, “the budget was not enough to mollify some Senate Republican moderates, who expressed concern Wednesday about extending the tax cuts at a time when the deficit is at a record high and domestic programs from farm subsidies to veterans' benefits and education are facing steep cuts.” Last year recall that a few key Senators – Voinovich (R-OH), Collins, (R-ME), Chafee (R-RI), and McCain (R-AZ) – were extremely outspoken in their opposition to budget policies which they did not feel were fiscally responsible. With this year’s budget, Chafee has said, “I've been consistently opposed to tax cuts when at the same time we're not controlling our spending, and I don't think this year will be any different.” Another Senator wary of fiscal irresponsibility, Snowe (R-ME), has said, “Suffice it to say, I do have serious concerns with the fundamental priorities that are being constructed in the budget. It's exacting a high price from some of the programs that are critically important to the future." Senator Coleman (R-MN) is yet another Senator opposed to the budget proposal; however he is opposed more to specific cuts laid out in the budget instead of the costly tax cut proposals. Coleman has gathered signatures of 57 senators to fight for urban renewal grants, which Bush has proposed to cut. The battle over the budget in the Senate will prove to be very interesting. Republicans have 55 votes in the Senate, which is four more than they would need to pass the budget if everyone voted on party lines. Past budget battles have resulted in Congress being unable to adopt a budget blueprint in two of the last three years; another failure to do this would reflect badly on both the President -- who has been lately stressing the importance of fiscal responsibility -- and Congressional GOP leaders as well.

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More Details on House Budget Markup

House Republicans working on the budget have proposed cutting almost $18 billion more in mandatory spending cuts than President Bush requested. The cuts are especially deep in medicaid. They also outlined their plans to provide more for military costs in Iraq and Afghanistan and for fixing the alternative minimum tax, all while setting aside billions of dollars to go towards Bush's tax cuts. Notably, the budget "mark" does not include any caps for discretionary or entitlement program spending. It proposes an overall 2.1 percent discretionary spending increase, however a good chunk of that increase is in areas of defense and homeland security. The House budget blueprint will most likely go to the floor next Wednesday. For more details check out the House Budget Committee web site here.

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Tax Cuts in the Budget Committee Markups

Today marks the beginning of budget committee markups. Click here for the House Budget Committee Overview of the FY 2006 Budget Resolution. The Senate mark should be available later today. It appears today that House Republicans are planning to include approximately $48 billion in tax cuts in their budget resolution, while the Senate is supposedly planning to include around $70 billion. While these numbers are significantly lower than Bush's request, they are still extremely costly endeavors in a time when we are facing high cyclical deficits and proposing to cut spending for social programs significantly. A good editorial in today's Washington Post compares the Congressional Budget Committees' action of lowering the amount spent on tax cuts to "the restraint of a dieter who is accustomed to scarfing down three pies a day and wants applause for cutting back to one." This analogy is right on track. Any tax cuts pursued in this budget reconciliation process in conjunction with spending reductions in mandatory programs are costly and contradictory actions that use the guise of deficit reduction to further shrink the role of government and actually result in larger budget deficits. Click here and here for more information on the tax cuts. Click here for an informative Center on Budget and Policy Priorities report on CBO's recent preliminary analysis of the President's budget policy priorities.

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Tax Cuts in Reconciliation; Medicare Estimates Up

Three items of importance: Last friday the Congressional Budget Office released an updated analysis of the President’s budget for fiscal year 2006, which includes an update of their baseline projections for the 2006-2015 period. In preparing this updated projection, they revised their estimates for Medicare spending. See this document, "Updated Estimates of Spending for Medicare," for details. The CBO's new spending estimate is an increase of almost 50 percent since their last estimate. Also of importance is today's news that the Senate will set a budget reconciliation tax figure of roughly $71 billion, which is down from the approximately $100 billion Bush proposed spending on tax cuts in his FY 06 budget proposal. See this OMB Watcher article for more information. Senate Republican budget writers are now saying this amount should be sufficient to cover the cost of extending expiring tax provisions through the five-year budget window; however this cost does not address the potential high costs of alternative minimum tax reform. These tax cuts, because they will be completed in reconciliation, will be given as instructions to the Finance Committee to undertake. Reconciliation bills are considered under expedited procedures in the Senate and cannot be filibustered. Finally, yesterday Senator Hegel (R-NE) introduced a Social Security bill that is based on the creation of private investment accounts. Like the White House, Hegel supports diverting four percentage points of payroll taxes to fund these accounts. Hegel's plan would allow workers under the age of 45 to divert part of their payroll tax contributions for these accounts. Read a transcript of Hegel's speech on his Social Security proposal here. Senate Minority Whip Durbin (D-IL) reiterated the Democratic leadership's stance on Social Security reform by calling any plan with privatization accounts "non-starters" on Meet the Press the other day. Click here for more information.

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Senate Votes Against Both Minimum Wage Proposals

In yesterday evening's vote on the minimum wage, neither the Kennedy (D-MA) measure nor the Santorum (R-PA) counter-measure gained enough support to pass the Senate. The Kennedy measure, which would have increased the minimum wage by $2.10 over 26 months, was defeated 46 - 49. Perhaps more importantly, the Santorum measure -- which proposed to raise wages $1.10 but also included harmful changes to labor laws -- was defeated 38 - 61. See this Washington Post article and this OMB Watcher article for more information.

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Congress Rejects Competing Minimum Wage Amendments

On March 7, the Senate voted to kill two amendments to increase the minimum wage attached to the bankruptcy bill (S. 256). One offered by Sen. Ted Kennedy (D-MA), to raise the minimum wage from $5.15 to $7.25 per hour over two years, lost in a close 46–49 vote. The second, proposed by Sen. Rick Santorum (R-PA), and opposed by progressive groups, was soundly rejected 38–61. Santorum's amendment would have raised the minimum wage by $1.10 over two years to $6.25. Neither got the 60 votes needed to pass.

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Social Security Debate Takes Dramatic Shift

In a dramatic shift in how the administration has approached overhauling Social Security, Treasury Secretary John Snow stated March 2 the administration is open to considering proposals that would create government-subsidized personal savings accounts outside the existing Social Security system or through means other than a diversion of funds from an individuals’ payroll tax. This announcement comes amid speculation that the president’s plan for Social Security reform may be less attainable than he and GOP congressional leaders would like to admit.

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Bush Budget to Increase Deficits $1.6 Trillion over 10 Years

The Congressional Budget Office released its estimates March 5 for the cost of President Bush’s fiscal year 2006 budget, showing deficits increasing by $1.6 trillion over the next 10 years. The CBO report will greatly impact the way the House and Senate budget committees write their FY 06 budget resolutions set for markup this week.

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Tax Cuts Will Not Slash Deficits

Last friday the CBO released their report saying the President's proposal to cut entitlement spending will actually save $11 billion less than the White House had initially projected. On top of this, according to today's CQ update, congressional budget writers are planning to include the estimated costs of Iraq and Afghanistan operations as well as a one year extension of Alternative Minimum Tax relief in the budget. This is significant because the White House ignored each of these items in their budget propsal. Keeping these expenses -- as well as a deficit reduction goal -- in mind means the five-year tax cut figure in the budget resolution will likely have to decrease from what was originally envisioned by Bush and Congressional GOP leaders. Budget writers are realizing that these expenses, along with expensive tax cuts, will not achieve deficit reduction. Congressional aides are saying the tax cut amount may decrease from $100 billion to about $70 billion. There will be further updates later this week as the House and Senate budget committees mark-up the budget resolutions on wednesday and thursday.

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Resources & Research

Living in the Shadow of Danger: Poverty, Race, and Unequal Chemical Facility Hazards

People of color and people living in poverty, especially poor children of color, are significantly more likely...

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A Tale of Two Retirements: One for CEOs and One for the Rest of Us

The 100 largest CEO retirement funds are worth a combined $4.9 billion, equal to the entire retirement account savings of 41 percent of American fam...

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