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|August 25, 2011|
On August 2nd, after months of tense negotiations surrounding how to raise the debt ceiling and reduce the deficit, Congress passed and President Obama signed into law "The Budget Control Act of 2011,” preventing the nation from defaulting for the first time in our history. You can learn more about what the law means for children on our Budget Watch page. Since then, the nation's debt ceiling has been raised and a plan for deficit reduction has begun to take shape, but our work to protect children and families from deep cuts is only just beginning. The August 2nd deal tasks a congressionally-appointed and bipartisan Joint Committee on Deficit Reduction with developing recommendations to find $1.2 trillion in spending cuts or new revenues before this Thanksgiving. The Committee is empowered to make recommendations in all areas, including tax reform and cuts to entitlement programs like Medicaid, Medicare, SNAP/food stamps, and Social Security. And if the Committee does not agree on at least $1.2 trillion in deficit reduction or Congress does not approve the Committee’s recommendations, or the President vetoes the bill, automatic spending cuts (“sequestration”) will go into effect. CDF is committed to protecting programs that are critical to millions of children and families—programs like Medicaid, SNAP/food stamps, education, and Social Security—while working to ensure that the wealthiest Americans are asked to pay their fair share.
We’ll be watching as the “Super Committee” gets to work. So bookmark CDF’s Budget Watch page and check back often.
Congressional Leadership announced the 12 members of the Joint Select Committee on Deficit Reduction (now being called the "super committee") this week:
*Patty Murray, WA, next Chair of the Senate Budget Committee, 4th highest ranking Democrat in the Senate
Max Baucus, MT, Chair, Senate Finance Committee
John Kerry, MA, Chair, Senate Foreign Relations Committee
Jon Kyl, AZ, Senate Minority Whip, Member of the Senate Finance Committee (Sits on Subcommittee on Health Care)
Pat Toomey, PA, Member of the Senate Budget Committee
Rob Portman, OH, Member of the House of Rep 1993-2005, U.S. Trade Representative during Bush Administration, Head OMB 2006-2007
James Clyburn, SC, Third-Ranking Democrat in the House, CBC Member
Xavier Becerra, CA, Vice Chair, Democratic Caucus
Chris Van Hollen, MD, Ranking Member, House Budget Committee
*Jeb Hensarling, TX, Member of the Committee on Financial Services, Chairman, Republican Study Committee
Dave Camp, MI, Chair, Ways & Means Committee
Fred Upton, MI, Chair, Committee on Energy and Commerce
August 9, 2011
Last Friday, the credit rating agency Standard & Poor’s (S&P) downgraded the U.S. credit rating from AAA to AA+, the first debt downgrade in U.S. history. While S&P, along with several other credit rating agencies, had warned of a downgrade if Congress did not take timely action to raise the debt ceiling (before the nation hit its credit limit on August 2), the downgrade came as a surprise to many, resulting in extreme volatility in the stock market this week. S&P said the downgrade was based on how close the country came to default last week. Based on current spending and revenue projections, the nation is expected to once again reach its new credit limit of $16.7 trillion in 2013, requiring additional action by Congress before that date.
Although the large drop in the stock market resulting from the downgrade may feel more important to the average American than the downgrade itself, they are all related. Lower credit ratings often lead to higher interest rates for Treasury bonds, which in turn affects the interest rates we all pay on mortgage and auto loans. Rising interest rates lead to higher prices on just about everything.
While the nation's debt ceiling has been raised and a plan for deficit reduction has begun to take shape, our work to protect children and families from deep cuts is only just beginning. This "super committee", whose members were named earlier this week, has been tasked with identifying at least $1.2 trillion in spending cuts or new revenue before this Thanksgiving, and everything is "on the table". CDF is committed to protecting programs that are critical to millions of children and families - programs like Medicaid, SNAP/food stamps, education, and Social Security - while working to ensure that the wealthiest Americans are asked to pay their fair share.
Check back in the coming days and weeks to monitor the status of the committee's work and learn how you can raise your voice in support of children during this process.