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Climate Progress

11 Most Important Clean Energy Provisions in the President’s Budget Proposal

Energy Investments Would Create Jobs, Help Middle Class

by Daniel J. Weiss

President Obama’s proposed 2013 budget invests in clean energy to help power the engine of economic growth. The budget would direct funds to efficiency and renewable electricity technologies to create jobs and boost domestic manufacturing, and would also make manufacturing more efficient. The cleaner energy that will result from these investments will reduce pollution and protect public health. In addition, the budget would make taxes fairer by eliminating $40 billion in unnecessary breaks for Big Oil companies, which made record profits in 2011.

This clean energy vision would benefit middle-class Americans and the rest of the 99 percent. It is a stark contrast to the “drill, baby, drill” policies promoted by the American Petroleum Institute and other Big Oil allies.

Here are 11 important clean energy provisions in the president’s proposed 2013 budget:

1. Extends the production tax credit for wind energy. Wind projects currently receive a tax credit of 2.2 cents per kilowatt hour of electricity. Thanks to this production tax credit, enough new wind energy was built in 2011 to power more than 2 million homes. The credit is set to expire, however, at the end of this year. Without an extension, 37,000 jobs could be lost. The budget would extend the production tax credit through 2013.

2. Extends the Treasury Cash Grant Program (Section 1603 of the American Recovery and Reinvestment Act) to assist small renewable companies. This program provided grants in lieu of tax credits to small renewable companies that were unable to utilize the credits, but it expired at the end of 2011. Extending it for one year would create 37,000 jobs in the solar industry alone. The budget would extend the credit for one year and then convert the program into a refundable tax credit through 2016.

3. Increases R&D funding for advanced energy technologies. The Advanced Research Projects Agency-Energy, or ARPA-E, would receive $350 million for investments in potentially game-changing energy technologies. The Department of Energy reports that “11 projects that received $40 million from ARPA-E over the last two years have attracted more than $200 million in private capital following successful research breakthroughs.”

This funding would also boost domestic manufacturing, as investments in innovative R&D would lead to the development of clean-tech products that can be made in the United States.

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NEWS FLASH

Poll: Nearly Half Of Americans Say Deficit Primarily Caused By Wealthy Not Paying Enough In Taxes | A plurality of Americans — 46 percent — say the primary cause for the nation’s deficits is that “wealthy Americans don’t pay enough in taxes,” according to a new United Technologies/National Journal Congressional Connection poll. Just three percent blamed too much federal spending on the elderly, and just 14 percent blamed too much federal spending on poor people. Meanwhile, 80 percent oppose cuts to Medicare, 75 percent oppose cuts to Social Security, and nearly two-thirds oppose cuts to Medicaid. Perhaps for those reasons, Americans prefer President Obama’s budget, which raises taxes on the rich and preserves Medicare and Social Security, by a 10-point margin over the one proposed by congressional Republicans.

Economy

ANALYSIS: The Real World Debunks The GOP’s ‘Austerity Now’ Ideology

Today, the Obama administration released its proposed federal budget for 2013. The Republicans’ reaction has been swift and united in its thematics, claiming the budget fails to promote fiscal responsibility or future prosperity, accusing Obama of “duck[ing] the responsibility to tackle this country’s fiscal problems” and choosing to “campaign instead of govern,” and generally slamming the budget as a “threat to job growth” and “more of the same failed ‘stimulus’-style policies.” All of this suggests the Republicans are unaware that America is not, in fact, the only market-based western democracy attempting to work its way out of a massive economic slump — or that these efforts provide concrete lessons in what will and will not produce economic growth.

In Britain, a large package of budget cuts and austerity measures which rolled out in 2010 has not unleashed the proverbial job creators in the private market. Instead, the country is still shackled with an economic growth trend that’s even worse that what it suffered in the aftermath of the Great Depression.

In the Eurozone as a whole, the European Central Bank and other relevant authorities have so far insisted on massive austerity measures from struggling countries in exchange for fiscal aid. Here, too, the result has not been a revitalized economy but a continuance of dismal growth rates.

Here at home, the effect of 2009′s recovery package and the tax deal in December 2010 was more than offset by cuts in state budgets. By the end of 2009, the combined budgets of the federal and state governments had entered a period of fiscal contraction from which they have yet to emerge.

The portions of Obama’s economic policy which actually passed simply made the economic hole created by state-level cuts less deep. Which was a valuable and necessary function, but insufficient to actually boost the economy back to healthy growth. Contrary to Republicans’ claim that Obama’s first two years were a period of unbound Keynesian experimentation, austerity is the budgetary policy reality which has accompanied America’s stagnant economic growth.

This matters because, now that the wars in Afghanistan and Iraq are winding down, the Bush tax cuts and the lingering effects of the recession remain the two primary drivers of the U.S. federal deficit. While the Republicans insist on not only maintaining all the tax cuts, but blowing an even larger hole in our revenue with added tax relief for the wealthy, Obama has proposed raising new revenue by allowing the Bush cuts for the top income rates to expire and by eliminating other injustices in the code which go to the benefit of the wealthiest Americans.

Even more importantly, because our tax system pulls in a percentage of the country’s overall wealth production, tax revenues will continue to underperform as long as our GDP production remains below capacity. The perverse irony of austerity as an immediate response to economic recession is that it drives down demand and GDP, thus driving down revenues and deepening the deficit hole it seeks to mend. In the opposite direction, a sudden positive jump in GDP could bring our economy back into line with its pre-recession trend and bring tax revenues back up without any change in tax rates or policy at all. The policy history in Britain, Europe, and here in America since the end of 2008 shows the Republicans’ austerity fixation won’t deliver this reinvigoration. But a recommitment by the government to boost demand could do the trick.

Obama’s budget, while imperfect, aims for the proper balance and the proper order of repairs: Investment now in jobs, infrastructure, state aid, extensions for the payroll tax cut and unemployment insurance, and other immediate boosts to demand, followed by longer-term deficit cutting once the economy is again firing on all cylinders. If the GOP had not been using every political tool at their disposal to undermine this approach during the last four years, the president could probably have done considerably more.

Economy

How Obama’s Budget Helps Working Women And Their Families

Our guest blogger is Sarah Glynn, a policy analyst at the Center for American Progress.

President Obama submitted his budget for fiscal year 2013 to Congress this morning, with the explicit goal of “rebuild(ing) our economy and strengthen(ing) the middle class.” The $3.8 trillion budget includes $5 million to help individual states launch paid leave programs – similar to those in California and New Jersey – that allow workers to take paid time off from work to provide care to a new child or ailing family member.

While some have argued that government intervention into work-family policies will only increase the cost of employing women, and that the marketplace will respond by voluntarily providing policies in order to retain valuable employees, the evidence does not support these arguments. At present, there are huge gaps in access to maternity leave for working women. According to the U.S. Census Bureau, between 2006 and 2008 about two-thirds of mothers with a bachelor’s degree or higher received paid maternity leave, but only 18.5 percent of those with less than a high school degree did. New mothers who have access to paid maternity leave are more likely to return to their previous employer, and 97.6 percent of those who return to the same employer do so at their previous pay level or higher. When women have to change employers after giving birth, often times because they are forced to quit or are fired in the absence of paid maternity leave, more than 30 percent experience a drop in pay.

New research on California’s Family Disability Insurance program illustrates how offering paid leave to women after childbirth helps individual workers and the economy as a whole. California’s program was passed in 2002, and became available to workers in July of 2004. Paid leave is administered through the State Disability Insurance program, and is funded through payroll taxes on employees. Eligible workers in California who take leave receive 55 percent of their regular pay, up to a maximum of $928 per week, for up to 6 weeks to bond with a new child or to care for a seriously ill family member.

California’s program has increased both job retention and the number of hours worked by employed mothers. More than 95 percent of workers who took leave in 2009 and 2010 returned to work; 80 percent returned to the same employer. Workers who made $20 an hour, meanwhile, returned to the same employer 83 percent of the time. And according to researchers from the University of Virginia and Columbia University, paid leave increased hours worked by mothers six to nine percent.

Working mothers are often the ones keeping their families afloat. The typical working wife now brings home 42.2 percent of her family’s earnings, and while married families with a male breadwinner and a female homemaker haven’t seen incomes rise since the 1970s (when adjusted for inflation), families with a working wife have seen incomes grow by 30 percent. Families where wives work, work longer hours, and receive higher pay are thus more likely to maintain their position on the income ladder or move up.

If every woman in America had access to paid leave when she had a baby, estimates are that this would increase employment by approximately 40,000 new mothers each year. Imagine how many families that would help raise up into the middle class, or secure their foothold there. If we are serious about repairing the economy, we must remember that a rebuilding a strong middle class is not just about helping the unemployed find work, but also about helping workers keep the jobs they already have. Paid family leave is one policy that can help us meet those goals.

Climate Progress

President Obama’s Oil Change: Cut Tax Breaks, Invest in Jobs

Although gas prices and profits hit record highs in 2011, Big Oil kept receiving tax breaks better used as investments in the middle class

by Daniel J. Weiss

President Barack Obama’s proposed budget for fiscal year 2013 sets a responsible course for rebuilding the economy so that it works for everyone, not just the privileged few. Our middle class is the engine of economic growth, but is threatened by dwindling public investments, a tax system increasingly rigged to benefit the wealthy, a fraying safety net, and assaults on what should be the bedrock guarantees of Medicare, Medicaid, and Social Security.

The president’s budget protects those guarantees, boosts critical investments, and takes steps toward rebalancing the tax code so that all pay their fair share. And it does this in a fiscally responsible way, charting a path that nurtures the economic recovery while reducing the federal deficit, all without asking the middle class to shoulder a disproportionate share of the burden.

President Obama’s proposed fiscal year 2013 budget would make taxes fairer by, among other things, eliminating $40 billion in tax breaks over 10 years for oil and gas companies. About one-fourth of the savings would be invested in domestic manufacturing, which would create jobs.

Oil and gas companies are raking in record profits and clearly do not need these tax breaks. The big five oil companies—BP, Chevron, ConocoPhillips, ExxonMobil, and Shell—made a combined profit of $137 billion in 2011. This beats their previous 21st century record of $136 billion (2011$) in 2008, and ExxonMobil, Chevron, and ConocoPhillips were the first, fourth, and 15th most profitable companies on the Fortune 100 List in 2011.

Despite these humongous earnings, however, the American Petroleum Institute—Big Oil’s political arm—will likely trot out its tired excuses about why hugely profitable oil companies need $40 billion in tax breaks while middle-class Americans are paying higher gasoline prices.

Let’s review their arguments for keeping these unfair tax breaks:

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Economy

Ten Facts About The Obama Budget

President Obama unveiled his budget for fiscal year 2013 this morning in Virginia, touting it as a budget that took a balanced approach toward investigating in American economic growth now while reducing the nation’s deficit over the long-term. The budget is a step in the right direction, using both tax increases and spending cuts to cut the deficit and investing in infrastructure and other job creation measures to continue the economic recovery.

Like any budget, Obama’s is complicated, containing investments and cuts to various programs. With that in mind, ThinkProgress compiled 10 facts about the Obama budget based on the White House fact sheet and other reports:

1. The budget includes $350 billion in short-term measures to encourage job growth, including $50 billion in immediate infrastructure investment, $30 billion to rebuild schools, and year-long extensions of the payroll tax holiday and unemployment insurance.

2. The implementation of the Buffett Rule and the repeal of the Bush tax cuts for the wealthy helps reduce the deficit by $1.5 trillion over the next 10 years.

3. For every $1 in new revenue from those making more than $250,000 per year and from closing corporate loopholes, the budget has $2.50 in spending cuts including the deficit reduction enacted over the last year.

4. The total budget reduces the deficit by $4 trillion over the next decade.

5. Obama preserves the maximum Pell Grant award, a key difference from the GOP budget, and makes permanent then Americans Opportunity Tax Credit, which helps 9 million families afford the costs of college.

6. Unlike the last two GOP budgets, Obama’s budget protects Medicare and Medicaid from structural changes, and through small tweaks, saves $360 billion from those programs.

7. States will receive $30 billion in aid to prevent further layoffs of firefighters, teachers, and police officers, some of the hardest-hit workforces in the nation.

8. The budget eliminates 12 tax breaks to oil, gas, and coal companies, saving $41 billion over 10 years.

9. Obama preserves planned cuts to the Defense Department negotiated in the debt limit deal last August.

10. The budget maintains goals of putting one million electric vehicles on the road by 2015; doubling share of electricity from clean energy sources by 2035; and reducing buildings’ energy use by 20 percent by 2020.

As the Center for American Progress’ Michael Linden notes, Obama’s budget is far from perfect. It’s spending caps are too low, it’s defense cuts are too small, and it contains less new revenue than bipartisan plans like Simpson-Bowles and Rivlin-Domenici. But it prioritizes job creation and economic development and keeps America on the path to recovery, something Republican plans, unfortunately, fail to do.

Health

Obama’s Budget Health Care Savings In One Chart

This morning, President Obama unveiled a $3.8 trillion budget plan that eschews any dramatic reforms to entitlement programs but would still produce $360 billion in savings from Medicare, Medicaid, and other health care programs over 10 years. Obama Paul Ryan’s approach “to turn Medicare into a voucher or Medicaid into a block grant,” but does adopt several Republican-backed ideas that would increase means testing for higher-income seniors and discourage overuse of care by penalizing beneficiaries.

Under Obama’s approach, for instance, higher-income seniors would pay more for doctors visits and prescription coverage beginning in 2017 and all new enrollees will pay a $25 deductible as part of their Part B premiums. But for the most part, the budget is similar to the administration’s September 2011 deficit reduction plan and recoups the greatest savings from drug rebates and modernizing provider payments to achieve greater efficiency. Here is a chart showing where all the savings come from:

Given that Ryan’s Medicare savings don’t kick in until 2022, it’s hard to make a direct comparison with Obama’s proposal. But suffice it to say, Ryan would cut about 1.4 trillion from Medicaid alone and another $30 billion in net Medicare savings using last year’s 10-year budget window.

LGBT

Obama’s Seven Investments For Building A ‘Fair And Stable Economy For The LGBT Community’

The Obama administration’s 2013 budget promises to “build a fair and stable economy for the LGBT community, while continuing to defend their rights.” Below are seven investments for reducing anti-gay bullying, hate crimes, and HIV/AIDS infections:

– 4 percent increase to strengthen anti-discrimination enforcement: The Budget also proposes an increase for the Community Relations Service in the Department of Justice to fight hate crimes and provides a $14 million, or 4 percent, increase over the 2012 enacted level for the Equal Opportunity Employment Commission (EEOC), which is responsible for enforcing Federal laws that make it illegal to discriminate against a job applicant or an employee.

– Funding boost to combat hate crimes: In addition to the protections on the basis of sexual orientation or gender identity under the Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act, the Budget also proposes an increase for the Community Relations Service to fight hate crime.

– $86 million to combat bullying: The Budget provides $86 million for grants to States and local educational agencies under the Department of Education’s Successful, Safe, and Healthy Students program to fund activities aimed at preventing and reducing substance use, violence, harassment or bullying, and promoting student mental, physical, and emotional health.

– Increases funding for HIV/AIDS research and prevention to $28.5 billion: The Budget prioritizes HIV/AIDS resources within high-burden communities and among high-risk groups, including gay and bisexual men, Black Americans, Latino Americans and substance users. Compared to 2012, the Budget increases domestic discretionary HIV/AIDS funding at HHS by $119 million and Veterans Affairs (VA) HIV/AIDS funding by $74 million. Overall, total U.S. Government-wide spending on HIV/AIDS increases from $27.7 billion in 2012 to approximately $28.5 billion in 2013.

– Expands the Ryan White HIV/AIDS Program by $75 million: The Budget includes an increase of $75 million for care and treatment through the Ryan White HIV/AIDS Program. The Budget includes $1 billion for AIDS drug assistance programs, an increase of $67 million above 2012 levels to expand access to life saving HIV-related medications for uninsured and underinsured people living with HIV/AIDS. Based on current projections, this increase in funding for ADAP, combined with sufficient state contributions, will eliminate ADAP waiting lists in 2013.

– $330 million for housing assistance for people with HIV/AIDS: The President’s Budget requests $330 million for HUD’s Housing Opportunities for Persons with AIDS (HOPWA) program, to address housing needs among people living with HIV/AIDS and their families.

– Support global AIDS prevention and treatment: The Budget fully funds the balance of the Administration’s historic three-year, $4 billion pledge to the Global Fund to Fight AIDS, Tuberculosis, and Malaria, in recognition of this multilateral partner’s key role in global health and its progress in instituting reform.

Security

Gen. Dempsey: New Military Strategy ‘Has Real Buy-In’ Among Senior Military Leadership

Today at the Pentagon, President Obama, Defense Secretary Panetta and Joint Chiefs of Staff chairman Martin Dempsey laid out a new military strategy for the 21st Century that will move beyond the costly nation building enterprises such as the wars in Iraq and Afghanistan and shift the U.S. military’s focus on the Asia-Pacific region.

While Obama noted that the strategy calls for a “leaner” military, he, Panetta and Dempsey assured that the United States will still be able to confront multiple military challenges around the globe simultaneously. And presuming to be responding to right-wing critics that the U.S. is not spending enough on the military, the president noted that in ten years, the U.S. will still spend more than the next several countries combined:

OBAMA: Over the past 10 years since 9/11, our defense budget grew at an extraordinary pace. Over the next 10 years, the growth in the defense budget will slow but the fact of the matter is this, it will still grow because we have global responsibilities that demand our leadership. In fact the defense budget will still be larger than it was toward the end of the Bush administration. …

PANETTA: Make no mistake, we will have the capability to confront and defeat more than one adversary at a time. …

DEMPSEY: There has been much made and I’m sure there will be made about whether this strategy moves away from a force structure explicitly designed to fight and win two wars simultaneously. Fundamentally, our strategy has always been about our ability to respond to global contingencies where ever and whenever they occur. This won’t change. … We can and will always be able to do more than one thing at a time. More importantly, wherever we are confronted and in whatever sequence, we will win. … I’m pleased with the outcome. … and I’m hear today to assure you that it has real buy-in among our senior military and civilian leadership.

Watch clips of their comments:

While Dempsey noted that the new strategy won’t change the military’s ability to fight multiple wars at the same time, the National Security Network’s Heather Hurlburt writes that this so-called two war strategy “hasn’t been true, or truly doctrine, for a long time.”

“If it were a strategy, it doesn’t describe any strategy or capability we’ve had for decades,” says defense budget expert Winslow Wheeler. “People who declare coming off the two MRC [Major Regional Conflicts] ‘strategy’ as unraveling our defenses (eg. Dov Zakheim) are dilettantes.”

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