With the so-called budget "sequester" set to begin on March 1, U.S. Senator Sheldon Whitehouse (D-RI) today introduced two bills to replace the across-the-board cuts. The bills, which are cosponsored by U.S. Senators Carl Levin (D-MI), Tom Harkin (D-IA), and Bernie Sanders (I-VT), would raise the revenue needed to replace the sequester by closing tax loopholes that currently benefit the wealthiest Americans and big corporations.
The sequester is a series of harsh across-the-board federal spending cuts originally enacted after House Republicans refused to raise the debt ceiling in 2011. The cuts would hit everything from our military to Medicare to education funding. According to the Bipartisan Policy Center, the sequester cuts could cost one million jobs nationwide.
"My message today is simple: we can reduce our deficit in a much more balanced way by fixing our tax code to get rid of needless giveaways," said Whitehouse. "These bills provide a fair alternative that would help the economy rather than harm it. I hope they will serve as a starting point for our debate as we seek to prevent the sequester, and the expected million-job loss it would cause."
"Sequestration would have potentially devastating effects on national security, law enforcement, public safety, education and other important priorities," said Levin. "This legislation offers us a way to reduce the deficit while avoiding that enormous harm."
"This is a commonsense package of legislation that reduces the deficit in a way that does the least amount of harm to the middle class and the poor," said Harkin. "I am particularly encouraged that it includes a financial transaction tax to generate needed revenue."
Sanders said, "At a time when revenue is near a 60-year low in terms of GDP and when corporations are doing phenomenally well while the middle class in America is collapsing, it is absolutely appropriate to ask corporations and the wealthy to pay their fair share of taxes so we don't balance the budget on the backs of the elderly, the young, the sick and the poor."
Over the past two years, Congress has already taken action to reduce the deficit by $2.4 trillion. Of that, $1.7 trillion came from spending cuts, and only $700 billion came from new revenue. Whitehouse's bills seek to balance that out by achieving approximately $1 trillion in new deficit reduction through implementing the Buffett Rule (which Whitehouse first authored last year), ending tax giveaways for Big Oil, eliminating a costly tax policy that rewards companies for sending jobs overseas, implementing a modest 0.03% tax on financial transactions to discourage high-frequency trading, and more. The proposals are included in two bills: one that would replace the sequester for fiscal year 2013 only, allowing Congress time to pass longer-term deficit reduction through the regular budget process; and one that would replace all nine years of the $960 billion sequester.