Anyone who thinks they have all the Answers before they've even heard the Question - is Dangerously Deluded! Real Truth Requires Vigilance, Perseverance and Courage, regardless of Party and who wields Power. Left, Right, Center, Corporations, Government, Unions, Criminals or the Indifferent.
So the President has put out a Budget that cuts $1 Trillion over the next ten years, while the House GOP has proposed $63 Billion in cuts that Obama has already promised to Veto. But has every reasonable (not to mention unreasonable) idea been brought to the table?
Thinkprogress has Five Progressive Ideas that neither the GOP or the President has mentioned, maybe it's something the House Dems should be putting on table.
1. Rein In The Military Budget: Neither the president’s budget or the House CR cuts the overall level of defense spending. In fact, Defense Secretary Robert Gates’s request for the Pentagon budget is a whopping $553 billion — “the largest request ever” by the Pentagon and the largest adjusted for inflation since World War II. CAP Senior Fellow Lawrence Korb has laid out $1 trillion in defense reductions that can be made over the next 10 years by phasing out outdated programs and resizing our military. This comes out to roughly $100 billion a year, which is approximately how much funding is being proposed to be cut from the Pell Grant program.
2. Reduce Or Eliminate Subsidies To Big Agribusiness: The federal government “paid out a quarter of a trillion dollars in federal farm subsidies between 1995 and 2009.” “Just ten percent of America’s largest and richest farms collect almost three-fourths” of these subsidies. Rep. Jan Schakowsky (D-IL) has proposed — as a part of her progressive deficit reduction plan — a fifty percent cut in federal direct support for agriculture, which would save $7.5 billion in 2015.
3. Reduce Or Eliminate Wasteful Tax Expenditures: The CAP paper “Cracking the Code: A Closer Look at Tax Expenditure Spending” notes that “special credits, deductions, exclusions, exemptions, and preferential tax rates provide more than $1 trillion in subsidies intended to support public objectives,” yet are ineffective and should be reduced or eliminated. Eliminating this tax expenditure could save $100 billion, for example.
4. Enact A Financial Transactions Tax: A “0.25 percent tax on trades of stocks, bonds, derivatives, and other Wall Street financial instruments” would do little to nothing to reduce commerce or productivity but would generate “between $50 billion and $150 billion annually,” according to a CAP analysis.
5. Empower Medicare To Negotiate For Lower Drug Prices: One of the main drivers of the growing U.S. budget deficit is health care costs. While there are a number of things that can be done to streamline the efficiency of our health care system, like introducing a public option or even moving towards a Medicare-for-all system, one policy option that would be very simple to enact and would not require any sort of increased spending or expansion of government would be to simply allow Medicare to use its bulk purchasing power to negotiate with drugmakers for lower prices. Rep. Peter Welch (D-VT) estimates that doing this could save as much as $156 billion over 10 years.
Taken all together these proposals could save as much as $3.2 Trillion over the next decade, far more than what has been proposed by either the President's Budget or the Republicans - without negatively impacting Social Security, Medicaid or Medicare and leaving plenty of room for infrastructure investment, green job growth and even retain significant middle-class and small business tax cuts.
Wouldn't you love to see a budget like this put forward by Democrats in the House and scored by CBO lined up side-by-side against the GOP or Presidents proposals?
How could either of them seriously argue they would prefer to go with the plans that Saves Less and Hurts More compared to a plan like this? Rather than sit on the sidelines, Progressives need to make sure their voice is heard and their priorities are on the table. You never know, just like with the Patriot Act Vote, we could pull more than a few surprise upsets as the GOP caucus splits, divides and separates into their far-right and super-far-right-libertarian flanks.
Rachel Contrasts the Budget Priorities of the President and Republicans. Both suggest harsh cuts - but it's on the spending that we see interesting and dramatic differences. Obama still wants to invest in Fast Rail, Green Tech and High Speed Telecom Backbone - they want to buy C-17s and engines for the F-31 that the Pentagon Doesn't Need.
And isn't it an interesting coincidence that the plants for these unwanted military projects just happen to be in Rep. Beohner and Cantor's districts? What was that about "No More Earmarks" again?
Before I get into the heart of this I just want to get one pet peeve from watching today's talking head class chatter about how "Obama's Budget Cuts aren't Serious because he didn't address Entitlements".
That is nothing but a Crock.
Obama spent well over a year passing a Health Care Plan that does address entitlements, it's saves $500 Billion from Medicare without cutting quality or restricting service and according to the Medicare Trustee's brings it into Surplus starting in 2012.
The outlook for Medicare has improved substantially because of program changes made in the Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act of 2010 (the "Affordable Care Act" or ACA). Despite lower near-term revenues resulting from the economic recession, the Hospital Insurance (HI) Trust Fund is now expected to remain solvent until 2029, 12 years longer than was projected last year, and the 75-year HI financial shortfall has been reduced to 0.66 percent of taxable payroll from 3.88 percent in last year’s report. Nearly all of this improvement in HI finances is due to the ACA. The ACA is also expected to substantially reduce costs for the Medicare Supplementary Medical Insurance (SMI) program; projected program costs as a share of GDP over the next 75 years are down 23 percent relative to the costs projected for the 2009 report.
Medicare is doing just fine.
Social Security is also going to be fine for Decades and before we start talking about raising the retirement age - we need to have increasing the payroll cap on the table too.
The biggest cause of the deficit was not spending (both TARP and the Auto Bailout were Loans which have been largely paid back), it was loss of revenue from the economic downturn and tax cuts - Spending as the CBO explains.
Since 2007, the recession and financial crisis, as well as the legislative responses to those problems, caused individual tax receipts to fall markedly. In 2009, individual receipts totaled just 6.4 percent of GDP, the lowest share since 1950.
Therefore the best way to fix this shortfall is to rescind necessary tax cuts and to invest in jump starting the economy. It's all about Jobs, Jobs, JOBS!
Let's all jump in the way back machine and recall how Republicans trashed the Stimulus in public, but praised it's "Job Creation" in private.
As Thinkprogress has noted nearly half the Republicans in Congress last session have engaged in rank Stimulus Hypocrisy.
ThinkProgress finds that over half of the GOP caucus, 110 lawmakers — from the House and Senate — are guilty of stimulus hypocrisy. Among some of the key findings:
– GOP Leadership Leads The Way In Hypocrisy: Although he regularly slams the stimulus as a waste while in DC, McConnell has returned to Kentucky to take credit for stimulus programs, even taking time to request more funds. ThinkProgress attended two job fairs held by Cantor, where we found dozens of employers able to hire directly because of the stimulus. Indeed, even Boehner’s office released a statement boasting that the stimulus will create “much needed jobs.”– The Audacity Of Hypocrisy Knows No Bounds: Many opponents of the stimulus have been quite brazen with their ability to try to claim credit for the program. For instance, Rep. Jack Kingston (R-GA) spent the morning of July 28th railing against the stimulus, yelling “Where’s the stimulus package? Where’s the jobs?” on the House floor. On the same day of his rant, Kingston’s office sent out multiple press releases bragging that he had secured hundreds of thousands in stimulus funds to hire additional police officers in his district. Other stimulus opponents, like Rep. Phil Gingrey (R-GA) — who has called the stimulus a “trillion dollar debt bill” — have printed out jumbo-sized ceremonial stimulus checks to present to local communities to try to garner positive press.
Individually, over half of the entire Republican caucus has hailed nearly every aspect of the stimulus as a success — from infrastructure funds, to food programs, to education grants
Despite this Republicans latest Budget Cut Proposal won't help create any jobs as it attempts to cancel and rescind all unspent Stimulus dollars, but it could also very well could help Kill People.
(Republicans) would cut about $60 billion relative to the 2010 baseline (under which the government is currently operating), or about $100 billion compared to President Obama’s fiscal 2011 budget request (which was never enacted).
The GOP’s proposal includes a slew of cuts to important programs, agencies, and investments, and would be detrimental to job creation, education, and scientific research. But they also specifically zero out many programs, cutting their funding entirely, including:
– High speed rail investments ($5 billion)
– COPS Hiring (supporting local law enforcement) ($298 million)
– High School Graduation Initiative ($50 million)
– Weatherization assistance program ($210 million)
– National Park Service climate change monitoring and response ($4.5 million)
– Corporation for Public Broadcasting ($86 million)
– Green Jobs Innovation Fund ($40 million)
And...
the proposal includes a 22 percent reduction in the Center for Disease Control and Prevention, massive cuts in basic science research, budgets slashing seeking to essentially eliminate U.S. government research on climate change, ... a true anti-science syndrome agenda.
This would be in additional to cutting all Health Care Funding, all funding for Wall Street Reform as well as funding to help stop lose nukes.
On Friday, House Republicans put forth a “continuing resolution” (CR) to fund the government past March 4th that was filled with spending cuts. While this came as no surprise, one focus of the cuts is causing some heads to turn. House Republicans are choosing to significantly cut the National Nuclear Security Administration’s nonproliferation programs, the sole purpose of which is to prevent terrorists from getting their hands on loose nuclear weapons and materials. While Republicans have talked about the need to inflict pain in their budget, doing so in a way that increases the risk of the nuclear annihilation of an American city is perhaps taking the pledge too far.
House Republicans have proposed to cut funding for these programs by 22 percent or $647 million. Michelle Marchesano of the Partnership for Global Security warns:
The US programs charged with securing fissile materials and thwarting terrorists’ efforts to acquire them are among the victims of this year’s federal budget fights. … Without appropriated budgets commensurate to program agendas, efforts to improve global nuclear material security will stall.
So the GOP don't want to spend on Health Care to help save the Lives of 45,000 Americans per year, they won't spend on Food Safety, Clear Air or Water (EPA), early warnings for Hurricanes and Storms (NOAA), to protect America from Nuclear Terrorism or from reckless Wall Street Investing which nearly destroyed the World's Economy - but they will spend to make Jet Engines we don't need?
The President has essentially staked out the middle ground, calling for tax increases (reversing the Bush Cuts), investments to spur the economy further and some spending cuts. Democrats need to champion their priorities, even if they differ from the President to pull as much of the budget back from the abyss as possible while the Republicans are sliding slowly off the far right edge. Ultimately this tug of war will probably bring us right back to where the President has started out, but one thing the Republicans can no longer claim is that they don't support spending to create jobs because it's quite obvious that THEY DO.
It's just they support spending on things we don't need, while Democrats want to invest on things that not only create jobs, they'll also save lives.
Stark: I want to know why a tax-raising, amnesty-giving, cut-and-running, negotiating-with-terrorists (Iran-Contra) guy is a hero to the conservative movement?
It's been said before, but yet again in their most recent update to the current Budget CBO has said it again. Here are the before and after projections.
As you can see there is a marked increase from the OMB numbers for FY2011 Budget compared to latest CBO projection. Why the difference? Follow over the flip.
Revenues under the President’s proposals would be $1.4 trillion (or 4 percent) below CBO’s baseline projections from 2011 to 2020, largely because of the President’s proposals to index the parameters of the alternative minimum tax (AMT) for inflation starting at their 2009 levels and to extend many of the tax reductions enacted in the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) and the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA). CBO’s baseline projections reflect current law, under which the parameters of the AMT revert to earlier levels and the reductions under EGTRRA and JGTRRA expire as scheduled at the end of December 2010.
...
CBO has also updated its baseline budget projections, which—unlike the President’s budget—assume that current tax and spending laws and policies remain unchanged. CBO has not modified its economic forecast, so those updated projections just take into account new information obtained about various aspects of the budget since the previous projections were completed in January. The resulting changes are modest, adding $11 billion to the projected deficit in 2010 and reducing projected deficits over the 2011-2020 period by a total of $63 billion.
So they make it pretty plain, the Bush Tax Cuts from 2001 and 2003 are why the deficit will not drop nearly 50% by 2012 as President Obama's administration had previously predicted.
But what about that "Job-Killing Health Care Spending Act"?
Other proposals—including ones associated with significant changes in the nation’s health insurance system—would, on net, increase revenues.
In other words, it would reduce the deficit.
And what would happen if we follow Tea-Publican advice and extended the Bush cuts permenently?
Another set of proposals would permanently extend or modify certain provisions of EGTRRA and JGTRRA that are set to expire at the end of December 2010. Those provisions include reductions in tax rates on dividends, capital gains, and other income;4 relief from the so-called marriage penalty; and an increase in the child tax credit. Other proposals would modify estate, gift, and generation-skipping transfer taxes by extending 2009 law permanently. If enacted, those changes would reduce revenues, relative to the baseline, by $2.2 trillion through 2020, according to estimates provided by JCT.
Not that such simple A-B=C math seems to work for Tea-Publicans like Michele Bachmann who responded to the President saying "every day families sacrifice to live within their means — they deserve a government that does the same."
With this...
"He's absolutely shameless," the Minnesota Republican could be seen saying to her seatmate, Representative Jean Schmidt, an Ohio Republican, according to a video taken in the U.S. House chamber during Obama's State of the Union address two nights ago.
Bachmann, 54, who later gave a televised response to the president on behalf of the Tea Party Express, turned back to face Obama and repeated, "Absolutely shameless!" She spoke as the president was saying the government should balance its budget more like average American families.
Interesting the Bachmann's SOTU-Prom Date was Jeane "Coward's Cut and Run" Schmidt.
And of course Bachmann would think it's "Shameless" since she's been going around Touting this bogus chart which attempts to blame all of our deficit and debt problems on President Obama.
Michele Bachmann may honestly not know this since she apparently doesn't know that John Quincy Adams died almost 20 years before the ratification of the 13th Amendment which finally abolished Slavery, or the fact the he's not a "Founding Father" since he was only 9-years-old in 1776, it's his Father was a Founding Father - not him, but she also doesn't know that the Federal Governments Fiscal Year for 2009 began on October 1st of 2008 - which was one month before Obama was even elected.
Before Obama Took Office, The FY 2009 Deficit Was Projected At $1.2 Trillion. As reported by the Washington Times: "The Congressional Budget Office announced a projected fiscal 2009 deficit of $1.2 trillion even if Congress doesn't enact any new programs. [...] About the only person who was silent on the deficit projection was Mr. Bush, who took office facing a surplus but who saw spending balloon and the country notch the highest deficits on record." [Washington Times, 1/8/09, emphasis added]
The Actual Deficit Chart from the End of Clinton (which shows a surplus) through Obama (which shows the deficit dropping after Bush's explosion) looked like this before the Bush cuts were extended by Decembers Tax Cut Deal.
Tea-Publicans like Bachmann are constantly trying to pin our budget problems on President Obama, but the fact is that the deficit began with Bush and that continuing to implement Bush's Policies will do nothing but continue to worsen our budget problems and deficit - not improve them.
Day in and day out we've heard the refrain that Washington has a Run-Away Spending problem. This has been the mantra of the Tea Party since it's inception and the mantra of nearly every Republican in Congress whose one lone goal has been - "To Cut Spending." This they argue must be done to reduce the "Mounting Dept heaped onto the backs of our children" - yet when you actually look at the current deficit projections after the first two years of the Obama Presidency, that deficit is actually Shrinking Already.
Contrary to popular myth, the rise in the deficit began before Obama's Presidency at the beginning of FY 2009 and is currently on track to be cut IN HALF to about $700 Billion by the end of his first term. This year the deficit has been reduced from over $1.5 Trillion to approximately $1.2 Trillion which is a $300 Billion Improvement.
The man who should be the first pick to replace the departing Larry Summers has just publish his latest piece analyzing the new GOP "Pledge to -AIG- America" and his prognosis is not - how do you say - good.
On Thursday, House Republicans released their “Pledge to America,” supposedly outlining their policy agenda. In essence, what they say is, “Deficits are a terrible thing. Let’s make them much bigger.” The document repeatedly condemns federal debt — 16 times, by my count. But the main substantive policy proposal is to make the Bush tax cuts permanent, which independent estimates say would add about $3.7 trillion to the debt over the next decade — about $700 billion more than the Obama administration’s tax proposals.
So the GOP want's to cut spending, but what exactly do they propose to actually cut? Well just about everything except for "common-sense exceptions for seniors, veterans, and our troops." But what do they list specifically?
On TARP and "unspent" Stimulus funds - which they claim would save a whopping - $16 Billion. Let than 1/2 of 1 percent of the Tax Cuts they want to make permanent.
Oh and by the way, 40% of the Stimulus were tax cuts and tax credits that haven't been "spent" because people have filed to take advantage of them - which means the GOP would be raising their taxes.
Krugman Continued...
Howard Gleckman of the nonpartisan Tax Policy Center has done the math. As he points out, the only way to balance the budget by 2020, while simultaneously (a) making the Bush tax cuts permanent and (b) protecting all the programs Republicans say they won’t cut, is to completely abolish the rest of the federal government: “No more national parks, no more Small Business Administration loans, no more export subsidies, no more N.I.H. No more Medicaid (one-third of its budget pays for long-term care for our parents and others with disabilities). No more child health or child nutrition programs. No more highway construction. No more homeland security. Oh, and no more Congress.”
The “pledge,” then, is nonsense.
In order to keep the tax cuts that GOP wants, we'd have to effectively dismantle nearly the entire rest of the Government except for Defense, Repeal Healthcare, Defund the Department of Energy, Education and of course NASA then - as we well know - they would then attempt to convert Medicaid to a Health Stamps Voucher program, put Social Security on the Stock Market and then privatize the VA as many of their members included the Paul Ryan "Roadmap" has outlined.
That "Roadmap" and this "Pledge" are to take this country over a financial cliff at full speed.
(The Pledge) is a significant boost for them, but it is not a homerun.
I'm think it's not even a sacrifice fly ball.
Club for Growth
In a blog post yesterday, Andrew Roth trashed Republicans as drafting a "weak" agenda, "silent" on earmarks and a balanced budget amendment, two core principles of fiscal conservatism. (And the earmarks thing is a little strange, given that the GOP already swore off them this year.)
"The Pledge has no teeth," Roth wrote. "Voters have no reliable assurances that House Republicans will behave appropriately."
Which is a rather ironic response since we now know that the author of the pledge, Bill Wild, is a former Club for Growth alumni.
Then there's Eric Erickson of Redstate
It is dreck -- dreck with some stuff I like, but like Brussels sprouts in butter. I like the butter, not the Brussels sprouts. Overall, this grand illusion of an agenda that will never happen is best spoken of today and then never again as if it did not happen. It is best forgotten.
Ouch.
And Neal Boortz...
"Up until right now, the focus was on the absolute disaster that is Democratic rule in Washington. Now, all of a sudden, the focus is on the Republican party," Boortz said. "Where's the word "tax reform" in this document? It's not there. Where's the phrase 'corporate income tax.' It's not there. Where is the Department of Education? It's not there."
This almost makes me believe that the GOP leadership is not nearly as confident as they pretend to be, and may have taken the wrong page from the Obama play book. The "Split-The-Baby" page, an approach that is relatively bland and "safe" which leaves no one on either side of the political divide feeling satisfied, and consequently pisses off everyone equally.
Congrats GOP, if this is your grand playbook your just about to enter the political Dog House - hope you enjoy the Beggin' Strips because that's about all you're likely to be eating for the next two years after you Fail to take over Congress.
Over again the Republican Party keeps trying to cut taxes on their primary financial supporters (Industry and their Shareholders) trying to tell us that the hello water raining down on our heads is Rain!
Herein where Con. Bilbray attempts to deny reality, returning the Tax Base to where it was during the Clinton Administration (as it was set before Republicans took over Congress in 1994) would not kill the Economy and would not stop job growth.
Over again the Republican Party keeps trying to cut taxes on their primary financial supporters (Industry and their Shareholders) trying to tell us that the hello water raining down on our heads is Rain!
MATTHEWS: Well there he is, Congressman Bilbray, your leader, your whip is now admitting that if you cut taxes, you’re raising the deficit. ... Why would he say something like that that runs against your orthodoxy?
BILBRAY: The fact is, look, Chris, you can’t get around the fact –
MATTHEWS: Well the fact is that he just said that. Why did he just say that cutting taxes at this point is going to yield a lower revenue and therefore a bigger deficit? What he just said what contradicts to what you just said.
BILBRAY: We’re not even talking about cutting about taxes. We’re talking about not allowing an increase –
MATTHEWS: — continuing the Bush tax cuts is what we’re talking about. And that’s what he was talking about.
BILBRAY: And that is maintaining the status quo –
MATTHEWS: — Are you in disagreement with Eric Cantor? Just tell me you disagree with him and we’ll be on the same page.
BILBRAY: I am disagreement with anybody that thinks we can get ourselves out of this mess by raising more taxes on the American people.
Contrary to Billbray's claim that the Republicans "Helped" cut the Deficit during the 90's the truth is that they attempted to Cut MEDICARE (below the Cost of Living Index) while implementing massive Tax Cuts that would have shot the Deficit up through the Roof and it was only because Bill Clinton was willing to call their bluff and shutdown the entire government - TWICE - that they were prevented from doing what George W. Bush did when he came into office - implement massive tax cuts and CUT Medicare (for which they used Reconciliation).
Republicans wanted a 7-Year Balanced Budget, but in reality the Budget was Balanced within 5 years because they used Clinton's strategy which was to ride the economic growth rather than spend everything via tax cuts in order to land on a specific date.
Bilbray - like other Republicans - suggests we rescind the unspent Stimulus and TARP funds, but most of that would lead to the layoff of Teachers, Cops and Firemen in various states and a Tax Increase on Small Businesses. It's completely opposite to everything he's claiming he supports. But then that's why they filibustered the Unemployement Extension and the latest Jobs Bill.
The fact is that Clinton didn't cut taxes he raised them on the Rich by 3% and it didn't hurt the economy, we had the largest and strongest period of economic growth After he did that. The majority if not all of the Bush Tax Cuts need to be rescinded permanently - returning us back to Clinton Era Tax Levels - or this country WILL NEVER get to a Balanced Budget again.
And as was shown on Countdown Last Night - not even the Architect and Implementor of the Reagan Republican Trickle Down Theory is willing to keep up the facade any longer.
But then again maybe none of this has to do with the Deficit or the Budget but really has to do with Rank Partisan Bigotry as (soon to be former Republican Rep) Bob Inglis Admits.
Inglis said that one of the reasons for his defeat was because he refused to demagogue like other conservatives in the House. In one instance during the primary, Inglis was chastised simply for not calling President Obama a “socialist.” He also noted that many of the GOPs criticisms regarding Obama’s response to the economic crisis were motivated by racism:
Instead, he remarks, his party turned toward demagoguery. Inglis lists the examples: falsely claiming Obama’s health care overhaul included “death panels,” raising questions about Obama’s birthplace, calling the president a socialist, and maintaining that the Community Reinvestment Act was a major factor of the financial meltdown. “CRA,” Inglis says, “has been around for decades. How could it suddenly create this problem? You see how that has other things worked into it?” Racism? “Yes,” Inglis says.
Everything the Republicans are doing is driving us full-on back into the ditch that Bush crashed us into as Paul Krugman notes - they're Addicted to Bush
The truth, however, is that the only problem Republicans ever had with George W. Bush was his low approval rating. They always loved his policies and his governing style — and they want them back. In recent weeks, G.O.P. leaders have come out for a complete return to the Bush agenda, including tax breaks for the rich and financial deregulation. They’ve even resurrected the plan to cut future Social Security benefits.
Mmm Mm, give me some of those Good Ole Time Busisms.
As I've noted before Krugman isn't exaggerating, the Republican Battle Plan as published by Rep. Paul Ryan according to the CBO would...
Raise Taxes on the Poor and Middle Class by Eliminating nearly ALL Tax Deductions, Offsets and Credits.
Lower Taxes on the Rich by yet another 12-15%
Raise Social Security Taxes, while Decreasing Benefits for those under 55 by "Personalizing" up to 1/3rd of it on the Stock Market
Increase the Eligibility Age for Medicare to 69 and Cut Benefits
Replace Medicaid with Medical Savings Accounts
Completely Ignore Climate Change, Stall Green Energy Policies, Environmental Concerns, Safety and Health Regulations
This is what these people want to do, and why the scream and cry so loud. This is what we need to remember every time one of them opens their mouths, they're out to destroy the Middle Class, Period.
And addressing deficit spending is exactly what he's doing with the "Sending Freeze". Frankly based on what was described yesterday by Jared Bernstein on Rachel Maddow, it's not really a "freeze" if the Stimulus and other job generating elements of the budget are exempt.
Let's all recall the Obama originally pledged to cut the Federal Deficit in Half by the end of his first term.
Obama also promised to cut the federal budget deficit by more than half in his first term. That now appears unlikely, given the spending on the stimulus and the billions of dollars spent on bank and auto company bailouts. The 2009 federal budget deficit hit a record $1.42 trillion, and the red ink in the first two months of fiscal 2010 was nearly 6 percent higher than the same period in 2009.
So what he's supposed to be unveiling tomorrow is actually a considerable walk-back from his original goal. Plua what he's being criticized for - "Hooverism" - isn't what's happening.
Time and time again Bernstein explains that this is really about reseting priorities with some items cut and other items increased in a deficit neutral manner, with the exception of Economic Stimulus, Education, Homeland Security & Defense.
Here's his first try:
BERNSTEIN: Well, first of all, not in the middle, because we‘re talking about a freeze that would take effect in 2011.
But I think the important thing, Rachel, that your comments didn‘t get to is that we‘re not talking about an across-the-board freeze. That entitles this president to comb through the budget and find policies that help to create jobs and boost the middle class—like the policies we announced today which is what I was going to talk about anyway here—and to cut back on spending on the wasteful stuff, stuff that accumulates over the years that Congress has a very hard time pulling back on, that the lobbyists love. So, we‘re talking about boosting the spending that helps the middle-class pushing back on the special interests.
So, for example, today, we talked about a set of programs that will be in the State of the Union, that will be in this budget, the very budget we‘re talking about—programs that nearly double the child care tax credit for middle class families, cutting much higher into the middle class than the current policy, retirement security policies, policies that help students facing burdensome debt from college loans, policies that help with elder care. All of those are policies that can be boosted while this freeze is pulling back on some of the wasteful stuff that is nothing to do with jobs in the middle class.
Then he tried again....
BERNSTEIN: What I‘m saying is that, that is an aggregate freeze but it‘s not an across-the-board freeze.
Let me explain what I mean. If you have an across-the-board freeze, you say, OK, folks. Every agency, everything goes down by 3 percent, end of story. It‘s real simple.
That‘s not what this is. Some things will go down. Some things will go up. More things will go down than will go up. That‘s how you achieve some of the deficit savings.
Now, on the other—there‘s also a bunch of emergency spending that‘s outside of this freeze. The Recovery Act will continue to create employment. By the way, that‘s one of the other things I wanted to talk to you about because I know you get this.
The Recovery Act saved or created 2 million jobs so far, on track to create or save another 1.5 million before it‘s done. That‘s going to be in effect, of course, the rest of this year and in 2011 as well. This freeze won‘t affect that at all.
New jobs initiatives that the president will be outlining in the State of the Union—those will also be accommodated under this program.
So, we‘re going to really shift our focus here to stuff that works and
to help stabilize what is truly a long-term, unsustainable budget picture,
by squeezing stuff that doesn‘t help.
That's didn't work either... so he tried a third time.
MADDOW: I have to tell you, it sounds completely, completely insane.
BERNSTEIN: Two hundred and fifty billion over 10 years, but—by the way, I think it‘s wrong that we‘re not talking about additional programs to foster job growth.
The president, last month, talked about new jobs initiatives in areas of clean energy investment, building on some of the successes of the Recovery Act that you mentioned, but also considerable deep investments in clean energy, manufacturing for example, here in the United States, building the components of the new clean energy economy, education spending. The president talked about some favorable tax policies for small businesses. That‘s very much part of this targeted jobs agenda that you‘ll hear more about on Wednesday night and infrastructure spending—and, by the way, to that the president attached a number $50 billion.
So, we‘re talking about some serious investments in job growth to boost the middle class and I would again remind you about a set of announcements the president and vice president made today in the area of child care, elder care, student lending, retirement security, all part of new initiatives or expanded initiatives that you‘ll hear going forward—totally consistent with the freeze we‘re talking about.
The President is NOT going to be putting the brakes on job growth while attempted to implement a responsible budget.
I quoting so extensively because obviously Rachel wasn't listening, neither was Keith based on his program today which just completed.
Meanwhile Paul Krugman is freaking out. Robert Reich is freaking out - and somehow forgetting that when he was Secretary of Labor President Clinton cut the budget, cut deficit spending and reduced the overall Federal Workforce by an average of about 12% - and the Economy did pretty well during that time.
According to the tables current online at the OMB when President Obama came into office the Federal Budget Deficit was $1.8 Trillion, yet as of the start of this year the Budget Deficit for 2010 is - TADA - $1.2 Trillion which is a $600 Billion reduction.
The projection for 2011 is $900 Billion, and the 2012 projection is $575 Billion. That would be a more than a 50% reduction in the deficit over that time, pretty much what Obama said he was going to do. The primary reason for this deficit reduction isn't so much that President Obama has implemented a lot of spending cuts - the fact is that TARP, which alone was reason for about 30% of the huge 2009 deficit, has largely been Paid Back.
The government got $68 billion Wednesday from 10 financial firms eager to escape the curbs that came with taxpayer-funded capital infusions.
Repayment of the bailout cash J.P. Morgan Chase & Co., Goldman Sachs Group Inc., Morgan Stanley and the other companies got under the Troubled Asset Relief Program essentially leaves them on their own to wrestle with the recession and financial crisis. Some firms said they plan to immediately start the tricky task of negotiating to repurchase warrants that the government received in return for the infusions.
Also the end of 2010 is when the Bush Tax Cuts Finally Expire injecting a huge amount of cash back into the Federal System and putting us back on track to the Balance Budget we had when Bush first came into Office.
Let's also recall that Obama still has about $300 Billion of TARP funds still under his belt which he can put forward toward direct SBA Loans, as well as Small and Community Banks to help small Business grow and hire more people. And not nearly all of the Stimulus has been spent yet - so it's not like the White House is putting on the spending breaks, their simply reseting their priorities.
It's not an issue of Big Government Vs Small Government, it's Dumb Government vs Smart Government.
