All Articles Tagged "budget deficit"
(AP) — President Obama on Monday will call for a combination of spending cuts and $1.5 trillion in new tax revenue increases that would save $3 trillion over the next decade. And he will warn Congress that if they do not give him a “balanced” package that includes tax increases for the wealthiest Americans he will use his veto and make them start again. The president will make his pitch in the Rose Garden at 10:30 a.m. and the White House promised to provide details throughout the day. The outlines of the package were disclosed Sunday night by senior administration officials who asked not to be named. They said deficit reductions will total $4.4 trillion when new cuts are coupled with the $1.2 trillion in discretionary spending reductions included in the bill signed into law by the president last month after the debate over raising the debt ceiling. The additional deficit reduction, said the officials, would come from $1.5 trillion in tax reform; $580 billion in “cuts and reforms across all mandatory programs;” $430 billion from interest savings; and $1.1 trillion from the drawdown of troops in Afghanistan, the changed mission in Iraq and caps to limit spending on future overseas contingency operations.
(Chicago News Cooperative) – Gov. Pat Quinn set a chain of political finger-pointing in motion Thursday when he announced the closing of seven state facilities and the layoffs of 1,900 employees because of insufficient revenue. Quinn said the General Assembly was to blame for the cuts, while lawmakers blamed Quinn, Republicans blamed Democrats and Democrats blamed the economy. The next several months will determine whose message sticks—and whether the closures actually happen—but reams of competing press releases do not change the fact that Illinois is broke. After a 67 percent personal income tax increase in January, Illinois still has a stack of 138,000 unpaid bills totaling $3.8 billion, according to the state comptroller’s office.
(Los Angeles Times) — If you take mortgage interest tax deductions, the next 100 days could have significant financial implications for you because of Congress’ new federal debt ceiling plan. Although the compromise legislation itself involved no new taxes, it created an unusual mechanism — an evenly split, 12-member bipartisan super-committee that could call for major cutbacks on real estate write-offs by Thanksgiving. All it will take is a single vote by a lone senator or House member who breaks with his or her party to put the mortgage interest deduction into serious play. Here is what’s about to unfold and how it could affect you: The legislation signed by the president Aug. 2 calls for a two-step increase in the federal debt ceiling plus spending cuts of about $917 billion. It also created the Joint Select Committee on Deficit Reduction with the goal of slashing an additional $1.5 trillion from the deficit during the coming decade.
(New York Times) — What will the shrinking of the public sector mean for the black middle class? The black unemployment rate nationwide is 16.2 percent, far higher than the 8.7 percent rate for whites. Yet nearly 20 percent of black workers are employed by the government, according to numbers cited in an article by the political scientist Walter Russell Mead. With states and cities under pressure to cut back spending on public employees, what effect might lower benefits, and fewer jobs, have on the economic prospects for African-Americans in particular?
For all intents and purposes the current budget negotiations have been a dialogue among the wealthy while the rest of us pretty much sit mute on the sidelines.
In one corner you have Wisconsin Rep. Paul Ryan and the House Republicans’ absurd and vicious attack on the poor and working class 2012 budget plan, also known as A Roadmap for America’s Future, which has basically declared war on Medicaid, food stamps, unemployment insurance, and anything else benefiting people in their time of need. Ryan’s plan also proposes to keep taxes below 20 percent of GDP and keep military spending at about the same.
On the opposite end of the spectrum is the White House’s budget plan, which honestly is not all that opposite, but rather a pacified version of the Ryan plan, which would mean major reductions in entitlement programs and other civilian spending. The White House is also proposing to keep most of the Bush-era tax cuts in place, which means more for the top one percent while the rest of us chomp down on Maria Antoinette cake.
But there is a glimmer of hope, and I’m talking about real hope not that campaign slogan stuff. The Congressional Progressive Caucus, which includes 80 members of both House and Senate, want to institute a little economic affirmative action into the mock budget debate, currently underway in Washington.
It’s called the People’s Budget and it plans to do major great things. Co-signed by the likes of Rep. Maxine Waters and Sen. Bernie Sanders, that the plan concedes that the deficit can be eliminated in 10 years while protecting government benefits to the poor and working class. Among the things promised is a plan to eliminate the Bush-era tax cuts, funding for the wars overseas and corporate welfare for oil, gas, and coal companies. The plan also calls for $1.7 million investments in job creation, education, clean energy and broadband infrastructure. Sounds too good – or shall I say costly – to be true? Well, according to the drafters the plan can be funded by creating a Fairer Tax System, which would create new tax brackets with a range of 45% for earners of $1 million, to 49% for those with $1 billion or more. Moreover, by closing loopholes for multinational corporations and a financial speculation tax on derivatives and foreign exchange, the drafters believe that the US could save an upwards of $5.6 trillion – more than enough surplus needed to pay for job creation and other civilian benefits.
The People’s Budget plan has already been endorsed by world-renowned economists like Dr. Jeffrey Sachs and Paul Krugman and according to the Economy Policy Institute, the plan is not only achievable but could run lower deficits and place public debt on a more sustainable trajectory than either Ryan’s and the House Republican’s plan or the president’s budgets. So why has there been virtually no serious discussion in the mainstream media or push from the Democrats in Washington for the People’s Budget?
Because of what we already know but kind of tippy-toe around admitting: Both the Democrats and the Republicans, particularly so-called centrist Democrats and far-right Republicans, straddle the lines of it’s core values but ultimately bend to the demands of their wealthy campaign contributors. So Republicans and Democrats, who are in a continuous cycle of campaigning, do what many politicians up for re-election do and that is engage in deficit cutting measures, which won’t offend their corporate sponsors, such as spending on the poor rather than raising taxes on the rich and cutting military spending. The end result is always legislative deals, which tend to represent corporate interest over what is most beneficial to the actual tax paying citizens. Not to mention the overall media blackout and cynicism of the plan, including a writer for Forbes who called the People’s Budget a mirror image of the House-passed fiscal plan. “While the House GOP budget shows what happens when you try to slash the deficit with only spending cuts, the left’s budget shows what happens when you just raise taxes and cut defense spending.” However, Ryan’s plan is being met with serious discussion including the bipartisan proposed slashes to Medicare. But what part of the progressive budget has been taken with any serious consideration?
None of it because in the immortal words of Tupac Shakur “they got money for war but can’t feed the poor.” Even as President Obama is expecting to announce a drawdown of soldiers in Afghanistan, we still have two wars, one “humanitarian effort” in Libya and brewing tension in other parts of the Middle East, which will ultimately cost the American people. Which is why it is important the American people take up the fight of championing The People’s Budget. It is remarkable that the budget was able to gain traction in the House the way that it has. Unfortunately, and this just might be the cynic in me, it will probably be DOA in the Senate. But the idealists in me wants to believe that despite the rhetoric that caring for a population was too costly to be realistic, this budget could proves otherwise.
(AP) — Chicago Mayor-elect Rahm Emanuel named a new city finance team Wednesday to tackle a massive budget deficit that he said is a threat to the city’s economic future. Emanuel broadly estimated the budget hole at between $500 million and $700 million. The city’s inspector general’s office has warned the deficit is effectively more than $1 billion when spending increases are included to properly fund the pension systems.
By J. Smith
Under current law, if the government were to be shutdown, every government employee would suffer financially except for the President and Congress. Lawmakers recently approved a stop-gap measure to keep the doors of government open for another two weeks, but if amends over the budget are not made in time, no federal employees would collect pay checks except for the those lawmakers. Their salaries are paid with mandatory and not appropriated spending.
In an unusual turn of events, Congress recognized how ridiculous this was, and unanimously passed a bill last week stipulating that the president and members of Congress would not be paid if the government shuts down over a spending impasse or if the country exceeds its debt limit, Politics Daily reports.
Senator Barbara Boxer, Democrat of California, who sponsored the bill had this to say, “They shouldn’t get their pay and they shouldn’t get retroactive pay because this is a very basic responsibility that we have to keep the government running.” Amen, sister.
The President earns $400,000 annually and members of Congress collect $174,000 per year.
(New York Times) — President Obama conceded on Tuesday that his new budget does not do enough to resolve the nation’s long-term fiscal problems, but he counseled patience, suggesting that he would eventually come together with Republicans on a broad deal. But, Mr. Obama said at a news conference, any such compromise to address Medicare, Medicaid, Social Security and the tax system is months away and will first require an effort to build bipartisan trust — even as Democrats and Republicans battle intensely over how much to cut from the current year’s domestic spending.
The president spoke as Republicans on Capitol Hill accused him of a lack of leadership for not proposing a bolder budget for the fiscal year that starts Oct. 1. Yet behind the scenes are signs that both parties, for all their public crossfire, are reassessing the politics of deficits. The debt crises last year in Greece and other European countries served as a warning about the economic perils of chronic budget imbalances, and the rise of the Tea Party movement reflected a broader concern among Americans about the nation’s rapidly mounting debt.
By Charing Ball
I almost passed out yesterday when I opened my home heating bill.
January was a particularly brutal month here in Philadelphia with a string of snowstorms and below freezing temperatures. In Philadelphia, the average home heating bill will total more than $1,300 for the winter season; my bill for the month of January was over $300. This year, I vowed to stay on top of my energy usages, including winterizing the windows and doors, and keeping the thermostat no higher than 68 degrees – even if it meant walking around the house in sweaters, blankets, sweatpants and socks.
But there is just no way around it. To paraphrase and alter the words of Jimmy McMillan: the cost of oil is too damn high.
Generally, oil prices in the U.S. follow a seasonal pattern where prices typically rise during summer—also known as driving season—and drop after Labor Day. However, this year has been the reverse since national average prices have seen a steady increase after the Labor Day holiday.
Crude oil is now selling over $90 a barrel, causing U.S. gasoline and home heating costs to jump to the highest levels ever for the middle of February. Moreover, the national average for gasoline hit $3.127 per gallon last Friday, which is about 50 cents more than a year ago. In addition, all indicators are estimating that gasoline prices will reach $3.50 to $4 per gallon by Memorial weekend.
Despite these dire predictions, the Obama Administration appears to be taking counterproductive measures to assist families that continue to struggle through this impending energy crisis by proposing to cut a couple billion dollars from LIHEAP (Low Income Energy Assistance Program) in order to cut back the U.S. deficit.
Over the years, LIHEAP funding has grown significantly as the government tried to keep up with rising gas prices. In 2008, the government spent $2.6 billion on LIHEAP and in 2009, spending increased to $8.1 billion.
Unfortunately, oil prices aren’t getting any cheaper. According to a former Shell Oil Executive, gasoline prices could reach the $5 mark by late 2012. Additionally, various entities in OPEC are demanding that oil prices rise to over $100 a barrel, which means we are just seeing a preview of what’s to come in the future for oil prices.
The Obama Administration’s response to increasing oil prices has been dismal at best. Thanks in part to the economic downturn that has pushed the unemployment rate above 9 percent, many Americans have had to solely rely on social aid programs such as LIHEAP just to get by. Instead, the focus has been on cutting back some $300 million from community-based initiatives such as LIHEAP, which will barely make a dent in the projected $1.5 trillion deficit for the coming year.
As a result, American families from all economic levels will now be faced with economic challenges that stem from rising oil prices, including the cost of food, heating, and electricity.
(NNPA) — In sync with what football fanatics expect will be a bruising Super Bowl Sunday, political tensions on Capitol Hill are as hot as an Egyptian street fight with Democrats and Republicans poised for a bloody face-off over the nation’s finances. It’s the necessary, crucial time of year lawmakers love to hate, pushing their staffers to sweat over bulky Power Points and black ink in a complicated cage dance over how the federal government spends taxpayer money. “The budget is a bold declaration of a nation’s priorities,” argues Congressional Black Caucus Chairman Rep. Emanuel Cleaver (D-MO), the loquacious Methodist minister and former Kansas City Mayor who barely squeaked past a Republican challenge in his district during the 2010 mid-term election. “I always tell my church that if you want to know who a person is, look at their checkbook and how they handle their finances.” Back from what some observers described as near political death, Emmanuel sounds revived and recharged in his new role as two-year Chair of the Caucus, eager to tussle — and possibly deal — with conservative budget hawks circling over endless rows of line items. Hill heads were turning and brows raised last week when the Caucus unveiled its budget recommendations for the year in a politico-studded event of the African-American Who’s Who in Washington, billing it as the first ever annual “Commission on the Budget Deficit, Economic Crisis and Wealth Creation.” Indeed it was a “first,” keeping in fashion with the dusty classroom clamor of Black History Month firsts and patronizing accolades.