President Obama submitted to Congress the outline of his federal budget for fiscal year 2010, which the House and Senate will consider in the coming weeks. This is the new president’s first budget proposal, and it is a 180-degree turn from the past eight years. It’s aimed at rebuilding the middle class, reforming the nation’s health care system and helping working families educate their children, while asking the nation’s wealthiest to begin paying more of their fair share and ending tax breaks for corporations that ship U.S. jobs overseas.

The budget is a non-binding blueprint of expected policy and funding changes that will guide spending decisions for the fiscal year beginning on October 1. A version with more specific program-by-program funding levels is expected later in the spring.

The budget’s cornerstone is Obama’s plan to “transform and modernize the health care system.” The budget calls for setting aside a reserve fund of $634 billion over 10 years that will be dedicated to financing first steps towards achieving health care reforms. Funding comes from raising taxes on the wealthy, closing corporate tax loopholes and changes to federal programs.

Program changes include AFSCME-advocated proposals to restore fiscal integrity to Medicare by reducing private Medicare Advantage plans by $175 billion over ten years. The President’s proposal would also save the federal government and states money by increasing the prescription drug rebates paid to Medicaid by drug manufacturers. The budget also includes proposals to increase the availability of generic drugs, including biologic generics.

On the tax side, the budget calls for making permanent the $800 (for joint filers; $400 for single) “Making Work Pay” tax cut for 95 percent of America’s working families while preserving all dedicated payroll taxes that fund Social Security and Medicare; continuing to cut taxes for families through an expansion of the Child Tax Credit; and making the $2,500 American Opportunity Tax Credit permanent to help kids afford college.

The Obama budget plan will also leave in place recent tax breaks for middle-income earners, but let expire the 2001 and 2003 Bush tax cuts for taxpayers making more than $250,000 annually, fulfilling his campaign promise. He is also committed to making saving for retirement easier as the economy recovers by laying the groundwork for the establishment of automatic workplace pensions on top of and outside of Social Security.

Another major theme is a call for fiscal responsibility and honest budgeting through cutting the deficit by at least half over the next four years. At the same time, the budget calls for new investments in clean energy, education, infrastructure, as well as national security and veterans programs. In addition, the budget includes new investments in early childhood education, doubling funding for the Early Head Start program, expanding Head Start, and beginning a major new effort to ramp up the Nurse-Home Visitation program.

The President’s budget also calls for upgrading critical infrastructure through a new federal commitment to high-speed rail, including a $1 billion per year high-speed rail state grant program; enhanced security at over 90 major ports; improvements in homeland security; and investment in clean and safe drinking water with programs to fund over 1,000 clean water and nearly 700 drinking water projects annually.

And the Center for American Progress noted that the budget stands apart for its integrity:

It lays it all out there: the size of the deficit, the cost of the war, the cost of tax reductions, the details of tax increases, the state of the economy. It’s all there for everyone to see without deceit. It’s sad that such honesty is novel, but it is, and it’s welcome.

Now that’s change we can believe in – and change that will get our country working again for working families.

A detailed look at the budget is available from the Office of Management and Budget.

After eight years with a virtual “Do Not Enter” sign at the White House front door, President Obama has opened 1600 Pennsylvania Ave. to leaders, policymakers and advocates of a wide range of views.

On Monday, AFSCME President McEntee was among union and business leaders, conservative and progressive economists, and think tankers and Democratic and Republican lawmakers who came together for a “Fiscal Responsibility Summit.”

At the summit, President Obama unveiled his outline to cut the $1.3 trillion federal deficit he inherited from the Bush administration in half by the end of his term by letting the Bush tax cuts for the wealthy expire, reining in tax breaks for companies that ship jobs overseas and drawing down troops in Iraq, among other items.

Obama stressed the importance of restoring “discipline and honesty to our budget” while not losing sight of priorities like our ailing health care system, which he described as “the single, most pressing fiscal challenge we face, by far.”

He couldn’t be more right. Just like President McEntee stated in his latest Huffington Post blog entry:

“The cost of health care coverage has skyrocketed. It threatens the economic security of working families, it strains state and federal budgets and it reduces the competitiveness of American businesses (…) We need an American solution in which all of us – individuals, employers and government – share responsibility for guaranteeing quality, affordable health care we can all count on.”

Read more about the summit at the AFL-CIO’s Now blog.

This entry by AFSCME President Gerald McEntee is cross-posted from The Huffington Post and Oxdown Gazette.

On Tuesday night, President Obama spoke to the nation about how we will rebuild our economy. Like many Americans, I was heartened to hear him renew his commitment to pursue health care reform and to do it THIS YEAR. He told us that the “cost of our health care has weighed down our economy and the conscience of our nation long enough.” And he is right.

AFSCME members know this too well. The cost of health care coverage has skyrocketed. It threatens the economic security of working families, it strains state and federal budgets and it reduces the competitiveness of American businesses, especially those that compete in the global market. And shamefully, more than 46 million people have no coverage at all. Those fortunate enough to have coverage too often receive poor quality care.

We agree with President Obama that in reforming our health care system, we need to build on what works. Those who like their coverage should keep it. Those who don’t, should have a choice of private insurance plans or a high quality public health insurance plan. A public health insurance plan would operate more cost-effectively and drive quality improvements. This would force efficiencies and innovation in private insurance coverage. We need an American solution in which all of us–individuals, employers and government–share responsibility for guaranteeing quality, affordable health care we can all count on.

In his speech to the joint session of Congress on Tuesday, President Obama told us that we must address the crushing costs of health care in order to move our country forward. He gave us the grim statistics on why we must finally reform our health care system and get our health care costs under control. Today, it causes a bankruptcy every 30 seconds. By the end of the year, it could cause 1.5 million Americans to lose their homes. In the last eight years, premiums have grown four times faster than wages. Health care costs force small businesses to close their doors and corporations to ship jobs overseas.

President Obama has followed up his strong words on Tuesday night with a budget that makes good on his promise. While we don’t yet know all the details, he proposes to put $634 billion (over ten years) in a reserve fund to pay for health care reform. This is a substantial downpayment towards achieving comprehensive health care reform. And it’s not just money. The President’s budget also includes policy changes that will improve our health care system, such as reining in overpayments to private Medicare plans and requiring them to compete in order to offer coverage.

President Obama’s economic recovery plan included investments in our health care system that will reduce medical errors, bring costs down and improve quality of care and save lives. Now, he is building on these reforms in his first budget, making “an historic commitment to comprehensive health care reform–a down-payment on the principle that we must have quality, affordable health care for every American.” And he told us “let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year.” Amen to that.

This Sunday’s PARADE Magazine promotes an online poll asking: “Does America still need labor unions?”

I think you’d agree that it’s a pretty absurd question from PARADE. With the gap between the rich and the poor wider than it’s been since 1928, and with working families bearing the brunt of the economic downturn, it’s clear we need unions more than ever.

That’s why we’re fighting so hard for the Employee Free Choice Act. Workers deserve to be able to negotiate for better wages and benefits, but the deck is stacked against them.

Chances are good you saw the poll in yesterday’s paper too. PARADE calls itself America’s most widely-read magazine, reaching more than 70 million readers. Please be sure your voice gets heard in this poll! Tell PARADE America needs unions!

And with anti-union special interests waging a well-funded campaign of misinformation about the Employee Free Choice Act, you can be sure our opponents will be sending this poll around.

Let’s make sure they don’t skew the results. Vote YES today – America still needs unions!

You can check out more info on the Employee Free Choices at American Rights at Work at www.AmericanRightsatWork.org.

Some contractors who design and build the nation’s highways wrongly charged taxpayers $73 million for ballooning executive compensation, lavish perks and other unallowable expenses, according to an article by Robert O’Harrow Jr. in last Saturday’s Washington Post.

One firm alone charged $950,000 in unallowable costs, included a political contribution, spa resort bills and alcohol. The auditors estimate that in 2003, executives at design and engineering firms with highway contracts overpaid themselves by as much as $73 million.

Contractors also charged federal and state governments for sporting events, luxury cars, and golf shirts, according to a report by the inspector general of the Department of Transportation.

The Post reports that contracting out failed on numerous levels, with design and engineering contractors being “generally hired without competitive bids” and those contractors sometimes hiring “accountants that were not qualified to perform the reviews required by state and federal regulations. In many cases, they ‘hired firms with whom they had existing relationships.’”

With the nation’s economy in tatters, we cannot afford the fraud and abuse that this report indicates is rampant in contracting out essential government services.

After decades of government experiments with contracting out, we now know that the private delivery of our vital public services does not work. Contracting out often results in higher costs, poorer service, increased opportunities for corruption and diminished government flexibility, control and accountability. Contractors who design and build our nation’s highways have illustrated why our vital public services shouldn’t be privatized.

President Obama has said full “transparency and accountability” will be a top priority when it comes to implementing the American Recovery and Reinvestment Act. To that end, the White House unveiled a new website: Recovery.gov. The site gives citizens unprecedented access to details about how the money in the plan is being spent, breaking the information down by state, congressional district and federal contractors.

In addition, the White House released detailed estimates of what the job and recovery plan will mean across the country. This map from the Boston Globe uses the White House numbers to show the distribution of the 3.5 million jobs that are expected to be saved or created by the plan over the next two years:

Visit AFSCME’s State and Local Fiscal Relief page to download a 1-page fact sheet with details on the impact in your state, or download a breakdown of the job impact by congressional district (155K PDF).

A new television ad from AFSCME and Americans United for Change hailing the passage of the American Recovery and Reinvestment Act is now on the air. President Obama’s jobs plan will create 3.5 million jobs and jumpstart the economy in the near and long term by making investments in education, transportation, health care and renewable energy in addition to providing tax relief to 95 percent of Americans.

Passage of the plan by wide margins in both the House and Senate represents a repudiation of the failed trickle-down economic policies of the past eight years which created the current economic crisis. The ad was produced shortly after President Obama signed the jobs and recovery plan into law in Denver and will run on national cable and in the Washington, DC market through the end of the week.

AFSCME President Gerald W. McEntee noted that AFSCME sounded the alarm for assistance to state and local governments more than a year ago. He praised President Obama and Democratic leaders on Capitol Hill for crafting a bill that will “go a long way toward helping states, counties and cities provide the vital services that the public relies on in times of crisis.”

Brad Woodhouse, President of Americans United for Change, explains that the “Recovery” ad celebrates a major victory for the American people as we face the worst economic crisis in the generation:

“Passage of the Obama jobs plan will not only play a critical role in turning our economy around and getting people back to work, it represents a transformational and historic moment for our country. This achievement represents a dramatic shift away from the failed trickle down economic policies of the past to a new approach that builds our economy from the bottom up by investing in people and communities. As a result of the leadership of President Obama and Congressional Democrats, our country has taken a major step on the road to recovery.”

Read more on the ad from the New York Times Caucus blog and Daily Kos.

President Obama has just signed into law an economic recovery plan that includes substantial fiscal relief to state and local governments. Thousands of AFSCME members across the nation helped get this bill passed with phone calls, emails and faxes to members of Congress.

Watch a special video message from AFSCME International President Gerald McEntee thanking all of you who took action:

We succeeded despite the Republican leadership’s effort to kill the bill and stick to the failed policies that got us in this mess in the first place. Not one Republican supported this bill in the House. And only Senators Snowe and Collins (ME) and Specter (PA) were brave enough to break with their fellow Republicans in the Senate.

The opposition to Obama’s jobs and recovery package was truly shocking given the dire situation of our economy.

• AFSCME members are dealing with proposals for layoffs, furloughs, demands for contract re-openers and much more – all while demand for public services grows.
• America is losing 20,000 jobs a day and unemployment just hit 7.6%.
• States are looking at shortfalls this fiscal year that amount to 14% of their total budgets.
Projections for the 2010 and 2011 fiscal years look to be even worse.

While the compromise deal isn’t perfect, and we’ll probably need more help and perhaps another recovery bill, one thing is certain: without this plan, AFSCME members would feel much more pain. With it, we can avoid some of the most drastic cutbacks that would otherwise be made.

As a result of your hard work, the plan includes:

• $87 billion increase in the federal contribution for Medicaid programs, money that will immediately relieve pressures on state governments and free up resources for other purposes.
• $80 billion in new education funding to help states and local governments.
• $150 billion in spending on infrastructure, for transportation facilities, roads and bridges, public transit, clean water, flood control, school construction and energy efficiency.
• An additional $9 billion to the State Fiscal Stabilization Fund for flexible grants for critical public services.

Passing a jobs and economic recovery bill was the first of our three top legislative priorities in our “Make America Happen” campaign. Now we will fight to win quality, affordable health care for all and to pass the Employee Free Choice Act. And we’ll need you every step of the way. If the events – and your emails and calls – over the last few weeks have shown anything, it’s that when we join together, we can indeed make America happen, again.

AFSCME President Gerald W. McEntee issued the following statement on tonight’s passage of the American Recovery and Reinvestment Act:

“More than a year ago, AFSCME called for a plan to create jobs and give aid to state and local governments. Now, thanks to the bold leadership of President Barack Obama and Democrats in Congress, help is on the way. Passage of the American Recovery and Reinvestment Act is a major, historic victory for the American people. President Obama and the Democratic majority in Congress are delivering the change we voted for in November. Our members are proud to have played a big role in mobilizing at the grassroots level to get this bill passed. We have taken the first step in putting our country and our economy back on track.”

This entry by AFSCME President Gerald McEntee is cross-posted from The Huffington Post and Oxdown Gazette.

America is losing 20,000 jobs a day. Unemployment just hit 7.6% and states are looking at shortfalls this fiscal year that amount to 14% of their total budgets. Current projections for the next fiscal year are deficits that total 17% of budgets. And fiscal year 2011 is shaping up to be just as bad. That is why AFSCME made an economic recovery bill the top legislative priority in our "Make America Happen" campaign – our effort to win long term investment in public services, reform health care and strengthen the middle class through the Employee Free Choice Act.

AFSCME members are on the front lines as millions of our neighbors struggle to stay afloat. More than a year ago, AFSCME sounded the alarm and called for assistance for state and local governments. Now thanks to the bold leadership of President Barack Obama and the Democratic leaders in Congress, help is on the way. The historic American Recovery and Reinvestment Act will go a long way toward helping states, counties and cities provide the vital services that the public relies on in times of crisis.

The plan has more than $200 billion for state and local governments. Key parts of this aid include:

• An $87 billion increase in the federal contribution for Medicaid programs, money that will immediately relieve pressures on state governments and free up resources for other purposes;
• $80 billion in new education funding to help states and local governments;
• $150 billion for improvements to transportation facilities, roads and bridges, public transit systems, clean water, flood control, school construction and energy efficiency;
• $9 billion to the States Fiscal Stabilization Fund for flexible grants for critical public services.

AFSCME started talking about the need for state and local fiscal relief more than a year ago. An increase in the Medicaid contribution to states was our idea. We went to the Hill to ask for it. We worked to get hearings and introduced bills, and we recruited both Democratic and Republican lawmakers to support state and local aid. In the past two weeks alone, AFSCME members generated more than 40,000 phone calls, personalized letters and emails to targeted members of Congress. We also held 10 state and national press conferences. Working with Americans United for Change, we launched ads targeting 21 lawmakers to vote yes on the bill and end the Republicans’ "Just Say No" campaign of obstruction.

AFSCME marshaled our resources and worked with national organizations – including those representing the governors, state legislators, mayors and others – to make sure that any recovery bill that came out of Congress would include substantial new assistance to state and local governments. Now, after more than a year of hard work, we have an economic recovery plan that includes substantial fiscal relief for states and communities.

The compromise deal doesn’t have everything we wanted in it. It’s not perfect and we know it’s not a panacea for the problems we are seeing at the state and local level. But we know that without this plan our members and the American people would feel much more pain. With it we can avoid some of the most drastic cutbacks that would otherwise be made. I am so proud of our union and what we have done to help President Obama take this first step to get our country and our economy back on track. While the road ahead will not be smooth, we now have reason to hope.