The legislation, sponsored by Nevada Republican Sen. Dean Heller, above, received support from Senate Minority Leader Mitch McConnell, R-Ky. (Gannett file photos)
Senate Republicans on Wednesday proposed extending the federal pay freeze for three more years — that would bring the freeze to five years total — to help pay for an extension of the payroll tax cut.
In a statement announcing the introduction of the Temporary Tax Holiday and Government Reduction Act, Senate Minority Leader Mitch McConnell, R-Ky., and Sen. Dean Heller, R-Nev., rejected a Democratic proposal to pay for the payroll tax cut extension with a 3.25 percent tax on millionaires. McConnell and Heller said that tax would harm "job creators," and said extending the pay freeze is a more practical solution.
"This bill will provide some relief to struggling workers who continue to need it, but without raising taxes on job creators, which is what the Democrats' proposal would do," McConnell said.
Congressional Democrats and union leaders denounced the proposal, which would also cut the federal workforce by 10 percent, or about 210,000 employees, through attrition.
"Federal employees have already stepped up to the plate and are helping to put our nation on a sounder fiscal footing, accepting a two-year pay freeze which reduces the benefits they would have received by $60 billion over 10 years," said House Minority Whip Steny Hoyer, D-Md. "It is not appropriate to once again call on federal employees to contribute while not asking everyone else to contribute their fair share."
National Federation of Federal Employees President William Dougan called the Republican proposal "absolutely unacceptable," and pledged to fight it. The American Federation of Government Employees and the National Treasury Employees Union also criticized the plan.
"It is despicable that our elected representatives in Washington would propose taking thousands from the pockets of [Veterans Affairs Department] nurses, Border Patrol agents, and food safety inspectors simply to protect a small group of millionaires and billionaires," Dougan said. "Congress shouldn't be talking about cutting hundreds of thousands of middle-class federal jobs while our economy is on the brink. They should be fighting to save every last one. Where are their priorities?"
Heller's office said in a statement that extending the pay freeze to five years was proposed in the Simpson-Bowles deficit reduction plan, but that is incorrect. Simpson-Bowles last year proposed a three-year pay freeze.
The bill, S 1931, would only allow agencies to hire one new employee for every three who leave, until each agency cuts 10 percent from its workforce.
The bill would also freeze salaries for lawmakers and legislative branch employees through 2015.
Heller introduced the bill, but McConnell's strong statements of support show it is a priority for Senate Republicans.