SUBSCRIBE TO OUR FREE NEWSLETTER
Daily news & progressive opinion—funded by the people, not the corporations—delivered straight to your inbox.
5
#000000
#FFFFFF
5
#000000
#FFFFFF
chuck schumer
'Start Over From Scratch': Nobel Laureate Economists Denounce GOP Budget Bill
"The House bill addresses none of the nation's key economic challenges usefully and exacerbates many of them."
Jun 02, 2025
Half a dozen Nobel Prize-winning economists on Monday expressed their "grave concerns" about the sprawling budget reconciliation package passed last month by the Republican-controlled U.S. House of Representatives, warning that slashing an already frayed social safety net and exploding the record deficit in service of massive tax cuts for the wealthiest households will worsen the nation's economic woes.
"The most acute and immediate damage stemming from this bill would be felt by the millions of American families losing key safety net protections like Medicaid and Supplemental Nutrition Assistance Program (SNAP) benefits," Daron Acemoglu, Peter Diamond, Oliver Hart, Simon Johnson, Paul Krugman, and Joseph Stiglitz wrote in an open letter published by the Economic Policy Institute (EPI), a progressive think tank in Washington, D.C.
"The Medicaid cuts constitute a sad step backward in the nation's commitment to providing access to healthcare for all," the economists continued. "Proponents of the House bill often claim that these Medicaid cuts can be achieved simply by imposing work reporting requirements on healthy, working-age adults. But healthy, working-age adults are by definition not heavy consumers of health spending, so achieving the budgeted Medicaid cuts will obviously harm others as well."
🚨NEW: 6 Nobel laureate economists signed an open letter opposing the House budget bill 🚨 The bill adds significantly to the national debt while reducing incomes for the bottom 40%, they say. The most acute & immediate damage? Millions losing Medicaid & SNAP benefits: www.epi.org/publication/...
[image or embed]
— Economic Policy Institute (@epi.org) June 2, 2025 at 10:16 AM
Addressing the bill's staggering impact on public debt, the letter asserts that "U.S. structural deficits are already too high, with real debt service payments approaching their historic highs in the past year."
"The House bill layers $3.8 trillion in additional tax cuts ($5.3 trillion if all provisions are made permanent) on top of these existing fiscal gaps—and these tax cuts are overwhelmingly tilted toward the highest-income households," the Nobel laureates noted. "Even with the safety net cuts, the House bill leads to public debt rising by over $3 trillion in coming years (and over $5 trillion over the next decade if provisions are made permanent rather than phasing out). The higher debt and deficits will put noticeable upward pressure on both inflation and interest rates in coming years."
"The combination of cuts to key safety net programs like Medicaid and SNAP and tax cuts disproportionately benefiting higher-income households means that the House budget constitutes an extremely large upward redistribution of income," the economists warned. "Given how much this bill adds to the U.S. debt, it is shocking that it still imposes absolute losses on the bottom 40% of U.S households."
"The United States has a number of pressing economic challenges to address, many of which require a greater level of state capacity to navigate—capacity that will be eroded by large tax cuts," the letter concludes. "The House bill addresses none of the nation's key economic challenges usefully and exacerbates many of them. The Senate should refuse to pass this bill and start over from scratch on the budget."
The so-called Big Beautiful Bill is now in the Senate, where Minority Leader Chuck Schumer (D-N.Y.) has vowed on behalf of Democrats to "fight it with everything we've got."
"The Republican plan is simple: Sell out working and middle-class families to pay off the rich and well-connected," Schumer said in a "dear colleague" letter on Sunday. "The bill would raise costs and taxes by an average of more than $800 for 40% of American families. Twenty million Americans would see their healthcare costs skyrocket, while almost 14 million would lose their health insurance all together, including millions of children and seniors."
Furthermore, Schumer noted that "11 million people, including 4 million children, could lose access to safe and affordable food, while every one of the 40 million Americans receiving federal food assistance would get less support every month. All the while, their radical plan would see double-digit energy cost increases for American households and businesses, and threaten close to 800,000 good-paying jobs in the clean-energy economy."
"Their entire agenda," Schumer said of Republicans, "can be boiled down to this: Billionaires win and families lose."
Keep ReadingShow Less
No Tax on Tips? Democrats Could Learn Something From Effective GOP Pandering to the Working Class
If the Democrats ever hope again to be the party of the working class, they should never have allowed the Republicans to get credit for such a popular, if not flawed, proposal.
Jun 01, 2025
“This legislation will have a lasting impact on millions of Americans by protecting the hard-earned dollars of blue-collar workers, the very people who are living paycheck-to-paycheck. I urge my colleagues in the House to pass this important bill and send it to the President’s desk to be signed into law.” —Senator Ted Cruz (R-Texas)
Ted Cruz? How could this labor-hating showboat get away with posturing as a defender of the working class – especially low-wage workers who live on tips? This is the same Ted Cruz who gets most of his campaign funds from those who got rich by exploiting low-wage workers. How did Cruz, of all people, take this issue away from the Democrats, the once so-called party of the working class?
It seems the Democrats didn’t care about this issue. It was viewed by the party policy makers as flawed and not worth the effort. They only got on board after Trump trumpeted the policy change, which they then noticed was wildly popular with the public.
What does it say when Ted Cruz appears to be considering the needs of working-class people before the Democrats get around to them?
Even today, after Cruz and Trump, my progressive colleagues disparage removing taxes on tips. They correctly point out it would be better to increase the federal minimum wage for all workers, which now stands at $7.50, and $2.13 for tip workers. $2.13? Further, they argue that low-wage workers would be better served with the passage of paid family leave, refundable tax credits, and extensive universal health care.
Those are all good ideas, but wouldn’t no tax on tips complement those policies?
The progressive Economic Policy Institute claims that no tax on tips “will harm more workers than it helps.” It will
- “Help very few workers and undermine pay increases for many more.
- Expand the use of tipped work—a system rife with discrimination and worker abuse— potentially leading to consumers being asked to tip on virtually every purchase.
- Deplete state and federal budgets and create new avenues of tax avoidance, especially for high earners.”
EPI makes similar arguments for no tax on overtime, saying the policy will:
- “Encourage excessive hours of work while exacerbating inequities between workers able to work long hours and those who cannot.
- Put downward pressure on base wages.
- Open up a tax loophole easily gamed by high earners that would drain public budgets while further complicating the tax system.”
I have enormous respect for my brothers and sisters at the EPI. They do excellent research on behalf of working people. But in this case, I fear they are missing or ignoring the bigger political picture. The Democrats and the left should never allow the Republicans to position themselves as working-class heroes. Helping low-wage workers should be what Democrats do and no tax on tips and no tax on overtime—done right—should have been part of the party’s package before it became part of Ted Cruz’s.
For those of us who have worked for tips and valued overtime pay, getting a tax break simply means more money in our pockets. It is an immediate pay raise, even if it may not be the best way to improve the standard of living for working people. I’m having trouble understanding why a direct good for some is not a good thing.
Most tipped workers earn low wages in the food industry and in gig services like Uber. They are grossly underpaid. So much so that many don’t work enough to pay income tax and so won’t benefit, but for those who make enough getting a tax break will help. That’s appealing, which is why about 75 percent of Americans support the idea, according to a 2024 Ipsos survey.
The same goes for overtime. Nearly two-thirds of all workers are forced to work overtime as a condition of their employment. Work weeks are often extended to 50 hours or more as employers seek to avoid hiring new workers and paying their benefits. It is cheaper to run the existing workforce into the ground. But those extra hours at time-and-half are taxed more heavily, workers know, making it feel like all that extra work is getting you nowhere. A tax break will be welcomed, not shunned, by those workers.
Trump filled the breach, making the proposal in a speech in Las Vegas in June 2024, and the Harris campaign chimed in half-heartedly in support of the proposal after she entered the race in July. The two Democratic senators from Nevada, the state with the most service workers per capita, fully supported Cruz’s effort.
After the bill passed unanimously in the Senate last week, Chuck Schumer, the minority leader, belatedly weighed in with: “Working Americans—from servers, to bartenders, delivery drivers, and everything in between—work hard for every dollar they earn and are the ones who deserve tax relief, not the ultra-rich.”
Nice words for the Ted Cruz-sponsored bill, but why wasn’t a Democrat proposing this appealing policy? And where was Chuck, years ago, when runaway inequality was decimating the lives of low-wage tip workers? He was celebrating a strategy that cast aside working people in favor of higher income, more educated Republican voters. As he infamously put it in 2016:
"For every blue-collar Democrat we lose in western Pennsylvania, we will pick up two moderate Republicans in the suburbs in Philadelphia, and you can repeat that in Ohio & Illinois & Wisconsin.”
In addition to picking up Republican votes, he wants those fat campaign donations especially from those “moderates” working on Wall Street.
If the Democrats ever hope again to be the party of the working class, they should never have allowed the Republicans to get credit for such a popular proposal. What does it say when Ted Cruz appears to be considering the needs of working-class people before the Democrats get around to them?
It didn’t happen because, I truly fear, that the Democrats really have no strategy and no desire to become again the party of the working class. They seem quite content to allow the Republicans fill the breach. Good riddance!
Meanwhile, the Republicans crush the government workers who protect our air and water, workplace safety, workers’ rights to organize, public health programs, and scores of programs and projects designed to make sure that working people aren’t exploited and damaged by corporate interests that treat them as fodder in a profit-making machine. No tax on tips is exquisite Republican pandering, and an effective one.
Which leaves us at a crossroads we can no longer avoid or pretend just isn’t there or view as too difficult to achieve. The billionaires indeed have two parties. We need one of our own.
Keep ReadingShow Less
Progressive Petition Calls for DNC 'Emergency Meeting' to Shift Gears Against Trump
"Doing the same old thing (or nothing) nets the same dismal results," wrote one petition signer.
May 28, 2025
A petition sponsored by two national progressive organizations is urging the Democratic National Committee to convene an emergency meeting of all its members in order to chart "truly bold action" against U.S. President Donald Trump and his "cronies."
The petition, which was sent to Democratic National Committee (DNC) Chair Ken Martin this week and circulated by the groups RootsAction and Progressive Democrats of America, has 7,000 signers, according to a Wednesday statement. It also includes more than 1,500 individual comments from petition signers.
One petition signer, Andrea Helene Hansen of Hudson, New York, wrote: "As a lifelong Democrat (and I'm now 77 years old), I'm looking for an alternative since my party is failing me (and others of the boomer generation). WAKE UP!"
"Doing the same old thing (or nothing) nets the same dismal results. Time to represent your voters that want you to fight Trump and GOP and overwhelmingly support progressive programs," wrote Anne Eisinger of Auburndale, Florida.
Recent polling and the success of Sen. Bernie Sanders' (I-Vt.) "Fighting Oligarchy" tour—with appearances by other key progressives including Rep. Alexandria Ocasio-Cortez (D-N.Y.)—this spring suggest that a sizable portion of the Democratic base is keen to see Democrats pushing back forcefully against Trump.
The petition urges the DNC to convene the emergency meeting as soon as possible and make it fully open to the public.
"The predatory, extreme, and dictatorial actions of the Trump administration call for an all-out commensurate response, which so far has been terribly lacking from the Democratic Party," the petition states. "It is time for the Democratic National Committee, as the organization tasked with responding to the concerns of Democrats, to heed the insights of progressive policy analysts and grassroots activists—and that should begin at this emergency meeting."
The text of the petition does not specify which insights the groups and petition signers would like the DNC to heed.
According to the petition, waiting until the DNC's next regular meeting in late summer would be "irresponsible."
In a Common Dreamsop-ed published Wednesday, RootsAction national director Norman Solomon highlighted anger directed at Senate Minority Leader Chuck Schumer (D-N.Y.) after he decided to support a Republican spending bill in March, and Democratic congressional leadership's poor performance in recent polling.
"Four months into his job as the DNC's chair, Ken Martin has yet to show that the DNC is truly operating in real time while the country faces an unprecedented threat to what's left of democracy. His power to call an emergency meeting of the full DNC remains unused," wrote Solomon.
Meanwhile, the DNC recently took steps to void the elections of multiple DNC vice chairs, including gun reform activist David Hogg, who rankled DNC members earlier this year when he announced his intention to support primary challenges to "asleep-at-the-wheel" Democrats in safe-blue seats.
Keep ReadingShow Less
Most Popular