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Legislative Update August 2011

Congratulations to Ms. Hersman and Brother Verna!

Congratulations are in order for Deborah A.P. Hersman who was confirmed by the U.S. Senate on August 2, 2011, to serve a second two-year term as Chairman of the National Transportation Safety Board. The NTSB conducts comprehensive investigations of transportation accidents and makes safety recommendations. Ms. Hersman has been a member of the board for seven years and has been on scene at numerous major transportation accidents, including the disastrous freight train collision and hazmat spill in Graniteville, S.C., in 2009, that killed nine people, as well as the collision between two Washington Metropolitan Area Transit Authority trains that resulted in nine fatalities in 2009.

Congratulations also go out to Vince Verna who has been named as the new BLET Director of Regulatory Affairs, effective August 1, 2011. Vince is from my home town, Tucson, Arizona, and has served in many positions over the years for BLET Division 28. Most recently, Brother Verna was serving as the Arizona State Legislative Board Chairman and as Local Chairman for Division 28. He has been active on the RSAC Locomotive Standards and Operating Practices Working Groups and, in August 2008, gave a presentation to the Locomotive Standards Group to address extreme temperatures inside the locomotive cab, something with which I am sure Brother Verna was quite familiar after working out of the Tucsonterminal for the past 16 years. Vince’s wife Julie recently became a member of Tucson’s Guadalupe Auxiliary No. 28. Vince and Julie will be relocating to Washington, D.C., in the near future.

 

Budget Control Act of 2011

The House and Senate passed the Budget Control Act of 2011 on August 2 and it was signed into law by President Obama on the same day. The law involves the introduction of several complex mechanisms, such as creation of the Congressional Joint Select Committee on Deficit Reduction (sometimes called the “super committee”) and options for a Balanced Budget Amendment.1

Wikipedia provided the following outline of the provisions of this Act:

Debt limit:

  • The debt limit is increased by $400 billion immediately.[2]
  • The President may request a further increase of $500 billion, which is subject to a congressional motion of disapproval which the President may veto, in which case a two-thirds majority in Congress would be needed to override the veto. This has been called the ‘McConnellmechanism’ after the Senate Minority Leader, who first suggested it.[3]
  • The President may request a final increase of $1.2–1.5 trillion, subject to the same disapproval procedure. The exact amount depends on the amount of cuts in the “super committee” plan if it passes Congress, and whether a Balanced Budget Amendment has been passed.

Deficit reduction:

  • Spending is reduced more than the increase in the the debt limit. No increases in revenue above current law are included in the bill.
  • The bill directly specifies $917 billion of cuts over 10 years in exchange the initial debt limit increase of $900 billion. This is the first installment (“tranche”) of cuts. $21 billion of this will be applied in the FY2012 budget.[3]
  • Additionally, the agreement establishes the Joint Select Committee on Deficit Reduction, sometimes called the “super committee”,[1] that would produce debt reduction legislation by November 23, 2011, that would be immune from amendments or filibuster (similar to the Base Realignment and Closure).[3][4] The goal of the legislation is to cut at least $1.5 trillion over the coming 10 years and be passed by December 23, 2011.[4] Projected revenue from the committee’s legislation must not exceed the revenue budgeting baseline produced by current law. (Current law has the Bush tax cuts expiring at the end of 2012.) The committee would have 12 members, 6 from each party.
  • The agreement specifies an incentive for Congress to act. If Congress fails to produce a deficit reduction bill with at least $1.2 trillion in cuts, then Congress can grant a $1.2 trillion increase in the debt ceiling but this would trigger across-the-board cuts (“sequestration”) of spending equally split between security and non-security programs.[3] The across-the-board cuts would apply to mandatory and discretionary spending in the years 2013 to 2021 and be in an amount equal to the difference between $1.2 trillion and the amount of deficit reduction enacted from the joint committee. The sequestration mechanism is the same as the Balanced Budget Act of 1997. There are exemptions—across the board cuts would apply to Medicare providers, but not to Social Security, Medicaid, Medicare beneficiaries, civil and military employee pay, or veterans.

Balanced Budget Amendment:

Congress must vote on a Balanced Budget Amendment between October 1, 2011, and the end of 2011, but is not required to pass it and send it to the states in order for the debt limit increases to occur (as was the case in the previous Cut, Cap and Balance Act, which was not enacted).[3]

 

Other provisions:

  • Pell grant funding is increased, but other financial aid is cut. Graduate and professional students will no longer be eligible for interest subsidized loans.[5] Repayment incentives will also be done away with after July 1, 2012.
  1. ^ab c “Debt-Ceiling Deal: President Obama Signs Bill as Next Fight Looms”ABC News. August 2, 2011. http://abcnews.go.com/Politics/debt-ceiling-deal-president-obama-signs-bill-fight-looms/story?id=14213050.
  2. ^ab c Yeh, Richard; Hamilton, Alec (August 3, 2011). “Explainer: The Debt Deal – What Happens Next and What’s on the Chopping Block?”. 3. WNYChttp://www.wnyc.org/articles/its-free-country/2011/aug/03/debt-deal-so-far/.
  3. ^ab c d e f g Lisa Mascaro; Kathleen Hennessey (July 31, 2011). “U.S. leaders strike debt deal to avoid default”Los Angeles Timeshttp://www.latimes.com/news/nationworld/nation/la-na-debt-talks-20110801,0,3461991.story.
  4. ^ab c DeFrank, Thomas (July 31, 2011). “President Obama says Republican, Dem leaders have reached agreement with him to raise debt ceiling”New York Daily Newshttp://www.nydailynews.com/news/politics/2011/07/31/2011-07-31_president_obama_says_republican_dem_leaders_have_reached_agreement_with_him_to_r.html#ixzz1TlenyDGT.
  5. Levy, Gabrielle (August 1, 2011). “Debt-limit deal increases funding for Pell Grants”The Sacramento BeeMedill News Servicehttp://www.sacbee.com/2011/08/01/3809725/debt-limit-deal-increases-funding.html.

We are grateful that Congress did not cut Social Security, Medicare, and Long-term care in the first round of deficit reduction. Going forward, we must remain vigilant in our efforts to protect the health and retirement security of our seniors and future retirees.

BLET in Strong Opposition to Privatizing Amtrak

Following introduction of the Competition for Intercity Passenger Rail in America Act by Rep. John Mica (R-FL), and Rep. Bill Shuster (R-PA) on June 15, 2011 (see July 2011 update), BLET National Vice President Stephen Bruno testified on June 20 at a U.S. Senate hearing about ways to fund much-needed national infrastructure improvements. At the hearing, entitled “Building American Transportation Infrastructure Through Innovative Funding,” Brother Bruno stated that private funding must be used to supplement, not replace, current sources of public funding. He also stated that “American labor must continue to have the same protections they are entitled to and have fought so hard to acquire.” He pointed out that the Mica/Shuster plan would saddle Amtrak with all its debt while removing the Northeast Corridor, which is its biggest asset. He eloquently stated that “[t]his would endanger passenger and commuter rail throughout the country, and it would cause significant job losses among Amtrak employees. It places corporate shareholder interests ahead of the interests of the general public. The Mica/Shuster proposal invites corporate locusts to swarm in, acquire, and leverage the profitable assets and leaves nothing but a rotting husk.”

BLET National President Dennis Pierce expressed to members of the U.S. House of Representatives in a letter dated June 20, 2011, that the BLET completely opposes the Republican plan to privatize and dismantle Amtrak. The Mica/Shuster plan would jeopardize the jobs of 20,000 Amtrak employees and would undermine the stability of the Railroad Retirement system, thereby hurting all railroad workers.

A copy of Vice President Bruno’s complete testimony can be found at: http://www.ble-t.org/pr/pdf/Bruno_7.20.11_Testimony.pdf. A copy of President Pierce’s letter can be found at www.ble-t.org/pr/pdf/mica_proposal.pdf.

30 Million Amtrak Rail Passengers… WOW!!!

Amtrak has projected that its annual ridership will this year, for the first time ever, exceed 30 million passengers in the fiscal year that ends on September 30. The projection is based on strong June ridership numbers and expected ticket sales for July-September. The railroad has wisely invested the federal funding it has received to improve infrastructure and equipment, making it a more attractive means of travel in these times of high gasoline prices. So far this year, ridership is up 6.4 percent. Continued investment in Amtrak and passenger rail in general will support continued growth. Let’s keep reminding our congressional leaders of Amtrak’s ongoing success and encourage them to continue funding this important public transportation option in our country.

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