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Next budget battle: raising debt ceiling

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The budget deal hammered out at the eleventh hour by House Republicans, Senate Democrats and White House officials last week and approved yesterday will keep the government operating until Sept. 30, but according to Rep. Karen Bass (D-Los Angeles), House Democrats had no input into the plan which slices $38 billion from federal programs.

Bass said the knock-down-drag-out battle that preceded the budget agreement is being described as minor compared with what is looming on the horizon–a vote on increasing the debt ceiling. This issue is expected to be taken up in Congress in mid-May.

“Everybody says it will be cataclysmic if we don’t raise the debt ceiling. [Doing that] allows us to borrow money to keep the government functioning,” explained Bass, also noting that America borrows from international and domestic sources, and contrary to what has been said recently in the news, China does not own the majority of American debt.

According to the United States Treasury, 42.2 percent of our government debt is held by U.S. individuals and institutions; another 17.9 percent is owed to the Social Security Trust Fund. China holds only 7.5 percent, slightly ahead of Japan’s 6 percent.

Should Congress fail to raise the debt ceiling, Bass said it will have international repercussions, and again would put the American government in the position of having to shut down.

One of the key holdups in this recently finished budget battle was Republican insistence on defunding Planned Parenthood, a move Bass called “an attack on women, an attack poor women, and an attack on women of color.

“I know that when (some) women, especially young women and the low-income go to see the doctor for family planning, that’s the only doctor they see,” said the Congresswoman, adding that 97 percent of the medical services Planned Parenthood offers have nothing to do with abortion.

Additionally, she noted that it is private funds, not federal dollars that are used for the organization’s abortion activities.

Now that the budget agreement has been approved, there are some critical cuts that will impact local communities. These include a $600-million reduction in funding to community health clinics; $260 million in cuts to the National Institutes of Health; $20 million sliced away from the Community Services Block Grants; $182 million cut from Workforce Investment Act job-training grants and $950 million cut from Community Development Block Grants.

On a positive note, funding for Head Start will be increased $340 million over last fiscal year, and the Corporation for Public Broadcasting will receive the same amount of funding as it did in 2010-11. Republicans had proposed defunding the organization totally.

According to Gregg Irish, executive director for Los Angeles’ Workforce Investment Board, the cuts come as the city and county continue to experience some the highest unemployment numbers in the nation: L.A. city had 259,300 out-of-work residents, while the county (not including L.A. City) had 599,000 unemployed in February. That number does not count those who have stopped looking because of frustration.

“We ramped up (our training) to an extraordinary level because the president also provided stimulus money. The original logic behind that was the stimulus money would stimulate the economy. And all those people out of work prepare them for the jobs that were going to materialize after the recession.”

But those jobs didn’t materialize, added Irish, although they are starting to do so now.

That leaves agencies like Workforce Investment Boards caught between the philosophical rock and a hard place, Irish said. On one hand, some in Congress are demanding deficit reduction (meaning spending cuts); others are saying you’ve got to spend some to help the economy, and at the same time hundreds of thousands of people in the city remain jobless.

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