Financial Crisis

August 4th, 2011 by Mariah

Washington (CNN) — President Barack Obama called House Speaker John Boehner to discuss ways to break the current political stalemate over funding for the Federal Aviation Administration, White House Press Secretary Jay Carney said Thursday.


“Conversations continue as we look for ways to resolve this,” Carney told reporters. “We hope a solution can be found.” The president’s call to the speaker occurred Wednesday, he said.


The impasse has resulted in the furlough of roughly 4,000 aviation workers, as well as tens of thousands of additional layoffs in the construction industry and elsewhere.


The FAA has also been unable to collect federal taxes on airline tickets — leading to a revenue loss of approximately $30 million a day. If the dispute continues until Congress returns from its summer recess in September, the federal government will be out more than $1 billion in revenue.


Transportation Secretary Ray LaHood has been urging members of Congress to return to Washington from their summer break and, at a minimum, pass a temporary funding measure allowing the FAA and other workers to return to their jobs.

“They talk a lot about jobs. They give good speeches about it. I want them to walk the walk,” LaHood told CNN Thursday. “Put hard-working Americans to work so they can get a paycheck just like Congress is receiving on their vacations.”


The Democratic-led Senate went on its summer recess Tuesday without approving what would have been the 21st short-term funding extension for the FAA. The Republican-led House previously passed a short-term extension, but included some changes opposed by Democrats.


The dispute over the extension involves language in the House proposal that would reduce or kill subsidies to rural airports, specifically targeting some in Nevada, Montana and New Mexico — three states with influential Democratic senators.


A larger dispute behind the scenes also is a cause for the inaction. Republicans oppose a recent National Mediation Board decision backed by Democrats that makes it easier for airline employees to unionize.


The board’s ruling made passage of a vote to unionize dependent on getting more than 50% support of those voting. For example, if a company has 1,000 workers but only 200 take part in the vote to unionize, the rule change would require 101 “yes” votes for it to pass.

Under old rules, more than 50 percent of all workers eligible to vote — or 501 “yes” votes — would have been required for it to pass. Workers who didn’t cast ballots were counted as having voted “no,” making it more difficult for supporters to succeed.


Sen. Orrin Hatch, R-Utah, told CNN Wednesday he blocked a short-term compromise bid proposed by Democratic and Republican colleagues because of the organized labor issue.


At a news conference Wednesday, top Senate Democrats blamed Republicans for the work stoppage.


“This issue has nothing to do with essential air services (at rural airports) and everything to do with a labor dispute between airlines and the American worker,” said Senate Majority Leader Harry Reid, D-Nevada.


In response, Rep. John Mica, the Florida Republican who chairs the House Transportation Committee, said Senate Democrats have only themselves to blame.


“Senate Democrats had a House-passed FAA extension before them for two weeks but chose to do nothing,” Mica said.

But LaHood said controversial items didn’t stop lawmakers from passing extensions on other occasions.


“If you’ve got issues with labor, if you’ve got issues with money going to small airports to help airlines fly in and out, work that out,” he said.


“Don’t hold the American jobs and American people hostage over controversial issues that were not a problem on 20 other times when Congress passed an extension.”


As the dispute drags on, numerous FAA employees are being forced to dig into personal savings, prioritize their bills, and cut back on expenses in order to avoid financial devastation.


“We’re pretty much going to burn through all of our savings within a month and … now we’re working on programs out there to give us no-interest loans,” said Mark DePlasco, one of the furloughed employees.


“I don’t think any of us can even fathom going without a paycheck for another month and a half or even longer.”