Debt Limit Ceiling Temporarily Suspended
On February 4, President Barack Obama signed the “No Budget, No Pay Act of 2013” into law, officially suspending the nation’s debt limit through May 18. The bill also suspends pay for members of Congress if their chamber does not pass a budget resolution by April 15. Under the measure, the Treasury Department can simply ignore the current $16.5 billion debt ceiling and keep borrowing to cover the cost of federal obligations. On May 19, the debt limit will kick back in and automatically reset at a higher level. Treasury officials can then begin taking what they call “extraordinary measures” to continue paying the nation’s bills. Analysts at the Bipartisan Policy Center predict that the Treasury will run up about $450 billion in additional debt through mid-May and that the next point at which the nation will need to raise the debt limit will come in August.
Sequestration goes into Effect March 1
As we move into March, the biggest news nationwide is the sequestration. What is that anyway? It’s just a fancy word for across-the-board forced budget cuts in funding of national programs. The cuts went into effect beginning on March 1. Had it not been for the deals struck at the end of last year to avoid the “fiscal cliff,” these cuts, enacted by the Budget Control Act of 2011, would have begun going into effect on January 1. With the enactment of the American Taxpayer Relief Act of 2012 on January 2 of this year, the sequestration date was pushed back to March 1, 2013. Over the next seven months, the automatic cuts will slash how much federal agencies are allowed to spend by $85 billion. On a broader scope, $1.2 trillion will be trimmed from federal deficits over the next 10 years. The cuts are to be split 50-50 between defense and domestic discretionary spending. It’s all part of the attempts to get a handle on the growth of the U.S. national debt, which skyrocketed when the 2007 recession hit and now stands at more than $16 trillion.
This all began with the 2011 standoff over the U.S. debt ceiling, when Republicans in Congress demanded spending cuts in exchange for giving the Obama administration the needed legal headroom to pay the federal government’s obligations to its bondholders. Congress and the administration agreed to more than $2 trillion in cuts. About $1 trillion of that was laid out in the debt-ceiling bill and the rest was to be imposed through sequestration.
Remember the special congressional panel called the Super Committee created in August 2011 to find less painful ways to cut spending? In November of that year, the committee concluded its work, stating that they had failed to come up with a bipartisan agreement for a deficit reduction plan, leaving federal agencies to opt for more harsh cuts that no one wants.
More than $500 billion will be cut from the Defense Department and other national security agencies. The rest of the cuts will be on domestic programs, such as national parks, federal courts, the FBI, food inspections, and housing aid. The Pentagon has already laid out plans for furloughs of hundreds of thousands of civilian workers, as well as cuts to combat readiness training and weapons maintenance. Social Security, Medicaid, federal pay (including military pay and pensions), and veterans’ benefits are exempt; however Medicare spending will be reduced by 2% per year versus the previously planned levels.
It remains unclear how long the sequestration will last. Some speculate that in coming months public pressure will force Republicans to relent on revenue, especially as cuts to the military begin to be felt. But Republican leaders have said they will stand firm against tax increases, suggesting that they have won at least a temporary victory on reducing the size of the government.
BLET National Officers Testify at NTSB Hearing
Hearing on Accidents and Incidents in which Human Factors Play a Role: During the final week of February, the National Transportation Safety Board (NTSB) conducted a hearing in connection with its ongoing investigation into the June 24, 2012 high-speed head-on collision of two Union Pacific freight trains in Oklahoma that claimed the lives of two BLET members and a conductor, and seriously injured a second conductor. In his testimony as part of a panel of witnesses appearing before the NTSB, National BLET President Dennis Pierce informed the Board about the increasing complexity of the duties of a locomotive engineer due to new technologies, new regulations, and new operating requirements that force engineers to multi-task more now than ever before. He was also critical of the industry’s punitive approach to discipline. President Pierce pointed out that, at a time when the transportation industry has legitimate concerns about operating crews being distracted by personal electronic devices such as cell phones, BLET members are tasked with monitoring numerous electronic devices installed on locomotives to increase productivity and monitor performance in ways that divert their attention from the roadway ahead. He stated that, with so many systems to manage, today’s locomotive engineers are routinely put in situations that challenge their ability to balance all that they have to do. Yet the standard response when things go wrong is to place the blame on, and inflict punishment upon, the crew members rather than fully investigating the root causes of these events and adjusting systems and procedures to reduce risk.
President Pierce concluded his testimony by stating that the BLET does not agree that any engineer should be blamed for the systematic risks created by adding layer upon layer of electronic technology without proper training and retraining, and with inadequate consideration of the complexities of the human-machine interface. He also stated that the BLET is capable and ready to participate in efforts to properly train its members. To see the entire transcript of President Pierce’s testimony, please go to www.ble-t.org/pr/pdf/Pierce_NTSB_Goodwell.pdf.
Positive Train Control (PTC): On February 27, BLET National Vice President Steve Bruno participated in one of three panels of witnesses who testified before the NTSB in a day-long forum on Positive Train Control, focusing on implementation problems and delays that the railroads claim to be experiencing. In 2009, Vice President Bruno had coordinated the BLET’s participation in developing a PTC regulation after Congress mandated installation of PTC following the tragic collision in 2008 of a Metrolink passenger train and a Union Pacific freight train. He explained to the Board that with today’s train weights and distributed power train operations, the current fixed signal systems are outdated and that PTC, as an overlay on top of existing signal systems, is a necessity. Vice President Bruno urged the NTSB to stand firm against those in the railroad industry who are resisting, watering down, and lobbying against the implementation of this technology. The entire transcript of Vice President Bruno’s testimony can be found at www.ble-t.org/pr/pdf/Bruno_NTSB_PTC.pdf.
Historic Legislation to Fund Passenger Rail Passed in Virginia
On February 23, the Virginia State Senate, on a vote of 25-15, passed legislation to invest $568 million in the state’s passenger rail system via the Virginia Intercity Passenger Rail Operating and Capital Fund, which was established in 2011, and $230 million into their freight rail system via the Rail Enhancement Fund, for a total investment of $798 million over the next ten years, to improve Virginia’s rail network. Virginia is the first, and only, state with a dedicated pot for passenger rail and the first state to attach a dedicated, long-term funding source to the advancement the state’s intercity and high speed passenger rail system. Hats off to the BLET and BMWED brothers and sisters who supported Governor Bob McDonnell’s “Virginia’s Road to the Future” long-term transportation solution and helped to get this legislation passed. This will result in employment opportunities for members of the Rail Conference as well as other rail unions and other divisions of the Teamsters.