With both the House and Senate having passed legislation–American Taxpayer Relief Act of 2012 (H.R. 8)–that will keep the American economy from plunging over the so-called fiscal cliff, and President Barack Obama poised to sign the bill any day, there are still lingering concerns that must be addressed. This is particularly true about the remaining sequestration (automatic cut) requirements.
According to Congresswoman Karen Bass, the Congressional Black Congress (CBC) is concerned that the $12 million in cuts sliced out of discretionary spending (to match $12 million sliced from defense spending) must be replaced.
These cuts in discretionary spending have come from programs like diabetic and renal care, and were made, said Bass, to ensure that during the two-month postponement of dealing with the proposed automatic cuts, the budget deficit does not grow any larger.
This is the main reason that the CBC said its members reluctantly agreed to the budget compromised worked out.
Bass said there are many elements in the compromise that will definitely help the African American community. These include the extension of unemployment benefits for an additional year.
These, said the Los Angeles Congresswoman, will help 2 million long-term unemployed who would have otherwise gone without an unemployment check in January.
African Americans suffer from the highest unemployment rate of any ethnic group in the nation–13.2 percent compared to 7.7 percent for the entire country.
Other taxes that were scheduled to end, but will continue because of the compromise include the Earned Income Tax Credit, the Child Tax Credit and the tax credit for college.
Additionally Bass said the Alternative Minimum Tax, which impacts those making $50,000 and over, has been fixed by permanently indexing it to inflation. Consequently, middle-income earners will not be forced to pay thousands of more in taxes.
However, individuals earning $400,000 a year and couples with a combined income of $450,000 will pay more in marginal income and capital gains taxes–up to 39 percent from 35 percent.
A number of deductions will be phased out for singles earning $250,000 or more and couples earning $300,000. Budget analysts say this will add $620 billion in revenue to the budget.
President Barack Obama called the agreement “one step in the broader effort to strengthen our economy and broaden opportunity for everybody.
“Under this law, more than 98 percent of Americans and 97 percent of small businesses will not see their income taxes go up,” he said. “Millions of families will continue to receive tax credits to help raise their kids and send them to college. Companies will continue to receive tax credits for the research that they do, the investments they make, and the clean energy jobs that they create. And 2 million Americans who are out of work but out there looking, pounding the pavement every day, are going to continue to receive unemployment benefits as long as they’re actively looking for a job.”
Now that this immediate crisis has been averted, Congress has two months to begin thinking about the issue of sequestration. Bass believes that work on this will begin in the next couple of weeks once lawmakers have recovered from their marathon bargaining sessions to pass this current compromise.
Bass will hold an online community town hall tonight from 6-7 p.m. and invites constituents to join the conversation about the fiscal cliff. To register to participate, visit her website and sign up: http://karenbass.house.gov/e. Listeners may also call (888) 886-6603 ext 20726# at the time of the forum.
In addition to the budget compromise, Bass said the Foster Youth Caucus, which she founded when she went to Congress, was able to get a major piece of legislation onto the president’s desk.
Called the Uninterrupted Scholars Act, the legislation allows social workers the right to access the education records of foster youth. This will enable them to check for things like immunizations records and what courses students have taken. Bass said the law is the result of foster care listening tours her caucus conducted around the country. A critical problem that repeatedly surfaced was foster youth who were constantly moved from home to home having to retake courses.