CBO Analysis: Budget Deal Cuts 2011 Spending by $352 Million, not $39 Billion
Posted: April 14, 2011 Filed under: Barack Obama, Economy, U.S. Economy, U.S. Politics, Voter Ignorance, We are so F'd | Tags: Barack Obama, Congressional Budget Office, government shutdown, John Boehner, lying liars 15 Comments
Boehner and Obama agree to pacify the proles with lies
This is hilarious. From the National Journal:
A Congressional Budget Office analysis of the fiscal 2011 spending deal that Congress will vote on Thursday concludes that it would cut spending this year by less than one-one hundredth of what both Republicans or Democrats have claimed.
A comparison prepared by the CBO shows that the omnibus spending bill, advertised as containing some $38.5 billion in cuts, will only reduce federal outlays by $352 million below 2010 spending rates. The nonpartisan budget agency also projects that total outlays are actually some $3.3 billion more than in 2010, if emergency spending is included in the total.
The astonishing result, according to CBO, is the result of several factors: increases in spending included in the deal, especially at the Defense Department; decisions to draw over half of the savings from recissions, cuts to reserve funds, and mandatory-spending programs; and writing off cuts from funding that might never have been spent.
According to Fox News, Congress is in a uproar about it.
Liberal Democrats remain opposed to the plan because of its trims and because of policy points, like its restriction of abortion subsidies, but a rebellion is spreading among conservative members of the House and Senate.
The problem is that in heralding the deal, Obama, Boehner and Reid played up $39 billion in cuts, which were assumed to be for the current fiscal year. But those cuts include some gimmicky accounting and the savings obtained from not tapping reserve funds for programs like Medicaid.
When the CBO crunched the numbers on how the deal would affect the projected $1.65 trillion deficit for this year, the result was a reduction of .02 percent.
So I guess we could still be headed for a shutdown? The House will vote on the bill today.
The real danger zone for the deal would be around 70 Republican defections. That would cast doubt on whether there are enough moderate Democrats [i.e., DINOs] to fill the gap and get to the requisite 217 votes. It would also be nearly a third of the Republican caucus in opposition, a weak showing for the GOP ahead of the even bigger battle over Obama’s request for an increase to the government’s $14.3 trillion borrowing limit.
Bond buyers will be watching for major fractures here. If the House GOP is in a riot, watch U.S. debt prices start to climb.
We are so f’d.
Thursday Reads
Posted: April 14, 2011 Filed under: Crime, Medicare, morning reads, U.S. Economy, U.S. Politics, Violence against women | Tags: Bill Donohue, earthquakes, FAA, Gallup poll, global warming, James Inhofe, Long Island serial killer, medicare, morning news, Republicans, seniors, sexual abuse, Yellowstone supervolcano 18 Comments
Good Morning!! I have a real grab bag of news items for you this morning.
Via Ezra Klein, a Gallup poll found that nobody, including most Republicans, wants the government fooling around with Medicare. I can’t embed the chart, but you can see it at either of the above links. Klein:
The Republican Party has a bit of a problem: Their coalition is heavily weighted toward seniors. But their agenda is heavily weighted toward cuts to entitlement programs that benefit seniors. In 2010, they handled this by relentlessly attacking Democrats for the Medicare cuts in the Affordable Care Act. In 2011, they’re trying to handle it by saying that Paul Ryan’s Medicare cuts will exempt anyone under 55 — but because he’s keeping all the Medicare cuts from the Affordable Care Act and implementing them on schedule, that isn’t, by the GOP’s own logic, actually true….
The most popular position in the GOP’s coalition isn’t that Medicare needs a complete overhaul, as Ryan thinks. It isn’t that it needs major changes, or even that it needs minor changes. It’s that we shouldn’t try and control costs at all.
ROFLOL!
Speaking of arrogant and deluded Republicans, The Smoking Gun obtained FAA documents relating to an incident in which James Inhofe “scared the crap out of” a bunch of Airport employees when the elderly GOP Senator landed his plan on a closed runway.
Newly released Federal Aviation Administration documents and audiotapes shed a scary new light on a bizarre incident late last year during which U.S. Senator James Inhofe landed his Cessna on a closed runway at a south Texas airport, scattering construction workers who ran for their lives as the politician’s plane hopscotched over them and six vehicles.
The FAA material, provided in response to a TSG Freedom of Information Act request, details how Inhofe, 76, chose to land on the main runway at the Cameron County Airport on October 21 despite being aware that it was closed and had a large ‘X’ on its threshold….
Shortly after Inhofe landed, Sidney Boyd, who was supervising construction on the closed runway, called the FAA to report that Inhofe’s plane, a twin-engine six-seater, initially touched down on the runway and then “’sky hopped’ over the six vehicles and personnel working on the runway, and then landed.”
During the call, which was recorded by the FAA, Boyd said Inhofe’s antics “scared the crap out of” workers, adding that the Cessna “damn near hit” a red truck. Referring to the vehicle’s driver, Boyd added, “I think he actually wet his britches, he was scared to death. I mean, hell, he started trying to head for the side of the runway. The pilot could see him, or he should have been able to, he was right on him.”
Inhofe agreed to “complete a program of remedial training” so he wouldn’t lose his pilot’s license.
According to a report by the Senate Permanent Committee on Investigations, released today, Goldman Sachs “Misled Clients, Lawmakers on CDOs.”
Goldman Sachs Group Inc. (GS) designed, marketed and sold collateralized debt obligations that misled investors and created conflicts of interest as the company built short positions before the U.S. housing market collapsed, a Senate panel said in its report on the financial crisis.
In the case of one CDO, Hudson Mezzanine Funding 2006-1, Goldman Sachs told investors its interests were aligned with theirs while the firm held 100 percent of the short side, according to the report released today by the Senate’s Permanent Subcommittee on Investigations. Senator Carl Levin, the Michigan Democrat who leads the panel, urged regulators to review all of the structured finance transactions described in the report.
At a briefing today, Levin said he believed Goldman Sachs executives weren’t truthful about the company’s transactions in testimony before the subcommittee at an April 2010 hearing. He said he would refer the testimony to the Justice Department for possible perjury charges.
Good. I sure would like to see some prosecutions of these lying, cheating frauds.
Via Tennesee Guerrilla Women, Ashley Judd is “speaking out against misogyny.” She wrote a couple of paragraphs in her new memoir about rap artists promoting hatred and violence against women:
While speaking about an AIDS awareness program she works with, Judd writes, “Along with other performers, YouthAIDS was supported by rap and hip-hop artists like Snoop Dogg and P. Diddy to spread the message…um, who? Those names were a red flag.”
Judd continued, “As far as I’m concerned, most rap and hip-hop music – with its rape culture and insanely abusive lyrics and depictions of girls and women as ‘ho’s’ – is the contemporary soundtrack of misogyny.”
She concludes, “I believe that the social construction of gender – the cultural beliefs and practices that divide the sexes and institutionalize and normalize the unequal treatment of girls and women, privilege the interests of boys and men, and, most nefariously, incessantly sexualize girls and women – is the root cause of poverty and suffering around the world.”
The backlash was immediate and vicious, and included death threats. Judd apologized for generalizing about all rap and hip hop music, but ended with this:
“Hatred of girls and women, I will oppose with spiritual and non-violent principles every day,” she concludes, adding that the Twitter responses to her remarks included death threats. “Abuse and violence in any form, at any time, in any expression, are never okay. Period. I, and other girls and women, are not afraid of you. You can keep on hating, but I am going to keep on loving.”
More power to Ashley Judd!
In more violence against women news, the search for bodies is continuing on Long Island. After finding ten bodies so far on beaches, searchers are looking underwater for more remains. In addition the FBI is helping out with “high-tech planes.”
“This is not an episode of CSI. This is an intensive long term investigation that includes the use of sophisticated technology as well as good old fashioned detective work,” said Suffolk County Police Commissioner Richard Dormer at a press conference today.
Dormer said that the FBI will provide investigators with planes and choppers that use sophisticated aerial imaging technology of the Long Island beach area where the skeletal remains of at least nine bodies have been found so far.
“Weather permitting this operation will commence later this week…We’re hoping the technology will help identify skeletal remains that may still be out there,” Dormer said.
Police believe that there are no links between the bodies found on Long Island in 2010 and 2011 and four bodies that were found in Atlantic City in 2006.
According to the NY Post, some of the bones found in the past couple of days could be victims of another Long Island serial killer Joel Rifkin.
The skull and torso found on a desolate Nassau County beachfront are too old to be connected to the serial killings of four Craigslist call girls — and could belong to long-lost victims of notorious Long Island butcher Joel Rifkin, a source said yesterday.
“These are so old that roots were growing around the vertebrae and the skull,” the source told The Post.
“These could be one or two of Joel Rifkin’s victims who were never found,” or the work of another killer, the source said.
Further complicating the case, the bodies of a man and a young child have been found during the search.
Austria is the latest country waking up to the abuse of its children by Catholic priests.
Over 800 cases of abuse in Catholic institutions in Austria have been reported so far, a commission tasked with investigating abuse cases announced on Wednesday.
A total 837 abuse victims approached the commission, which was set up by the Austrian Catholic Church last year after it was hit by a wave of abuse revelations, commission head Waltraud Klasnic told a press conference.
Three quarters of the victims were male, with the most cases — about 20 percent — reported in northern Upper Austria province, followed by Vienna and western Tyrol, according to a commission report summarising its first-year findings.
Back in the good old USA, Bill Donohue of the Catholic League says the kids were asking for it.
The group bought an expensive full-page ad in The New York Times Monday that places the blames for the church’s scandals on “homosexuality, not pedophilia.”
And perhaps most shockingly, it also claimed that some children were active participants in the abuse.
“The refrain that child rape is a reality in the Church is twice wrong: let’s get it straight — they weren’t children and they weren’t raped,” self-appointed Catholic League president Bill Donohue wrote in the ad.
“We know from the John Jay study that most of the victims have been adolescents, and that the most common abuse has been inappropriate touching (inexcusable though this is, it is not rape),” he added, referencing a 2004 study by the John Jay College of Criminal Justice, which was funded by the U.S. Conference of Catholic Bishops.
“The Boston Globe correctly said of the John Jay report that ‘more than three-quarters of the victims were post pubescent, meaning the abuse did not meet the clinical definition of pedophilia.’ In other words, the issue is homosexuality, not pedophilia,” Donohue wrote.
Another issue is that priests are in a position of power and should not take advantage of that position to gratify their sexual desires. But I’m sure Donohue would disagree. And where I come from adolescents are still children.
In science news, a new study revealed that Climate change affects tectonic plate movement, causing earthquakes
Understanding why plates change direction and speed is key to unlocking huge seismic events such as last month’s Japan earthquake, which shifted the Earth’s axis by several inches, or February’s New Zealand quake.
An Australian-led team of researchers from France and Germany found that the strengthening Indian monsoon had accelerated movement of the Indian plate over the past 10 million years by a factor of about 20 percent.
Lead researcher Giampiero Iaffaldano said Wednesday that although scientists have long known that tectonic movements influence climate by creating new mountains and sea trenches, his study was the first to show the reverse.
Dakninikat sent me this one from the BBC: Yellowstone supervolcano fed by bigger plume
The underground volcanic plume at Yellowstone in the US may be bigger than previously thought, according to a new study by geologists.
The volcanic hotspot below Yellowstone feeds the hot springs, mud pots and geysers that bring millions of visitors to the US national park each year.
There have been three huge eruptions of the Yellowstone supervolcano: 2.1 million years ago, 1.3 million years ago and 640,000 years ago. Two of these eruptions blanketed a large area of North America with volcanic ash.
The most recent full-scale eruption of the Yellowstone supervolcano ejected some 1,000 cubic km (240 cubic miles) of hot ash and rock into the atmosphere. There have been smaller eruptions in between the largest outpourings; the most recent of these occurred 70,000 years ago.
Of course that can’t be true because the earth can’t possibly be that old, right?
That’s all I’ve got for today. What are you reading and blogging about?
Late Night Gas Pump Shock
Posted: April 13, 2011 Filed under: Economy | Tags: high gas prices, speculation, US economic recovery 27 Comments
I’m pretty happy that the mighty mustang is parked out front and staying there for the most part. Every time I do make it out, I nearly faint from the changes that I see in gas prices. I thought I’d share some links with you about what’s going on.
First, from Reuters: High gas prices hurt U.S. confidence: Reuters/Ipsos poll. It could also hurt the President’s approval rating.
Rising U.S. gasoline prices have damaged confidence in the country’s future and forced Americans to change their spending habits and lifestyles, a Reuters/Ipsos poll released on Wednesday found.
The proportion of people who believe the United States is on the wrong track jumped 5 points to 69 percent from March, the poll found, the highest wrong-track figure in an Ipsos poll since President Barack Obama took office in January 2009.
More than six of every 10 Americans have cut back on other expenses and reduced their driving as a result of the rising gas prices caused by tumult in North Africa and the Middle East.
The increase in energy costs also hurt Obama’s approval rating, which dipped for the second consecutive month to 46 percent — his lowest Ipsos poll rating since early December 2010.
“That’s all a function of gas prices. People are feeling the pinch at the pump,” said Ipsos pollster Cliff Young.
“Increased gas prices have a direct impact on the pocketbook, and there is very little lag time between rising gas prices and its effect on presidential approval and confidence,” he said.
There’s also some concerns that higher gas prices could hurt this very anemic recovery. Gas is one of those expenditures that folks usually can’t avoid without buying a better vehicle or getting a different commute to work. That means in the short run, high gas prices hurt people because they can’t adjust to them easily.
Gasoline prices are soaring toward $4 a gallon, a threshold that some analysts say will damage the fragile economic recovery and crimp consumer spending just as families are planning their summer vacations.
Higher prices saddle businesses with higher transportation costs, causing them to either swallow them or pass them along to already strapped customers. As gasoline costs go up, consumers are left with less money to spend elsewhere. And there is evidence that the hike at the pump is beginning to push drivers off the road.
Gasoline prices, which are approaching record levels, “are going to have a very profound effect on the economy,” said Peter Morici, an economist at the University of Maryland.
D.C. resident Amber Sutton, who drives 25 miles each way to her job in Woodbridge, said rising gasoline prices have caused her to cut back on restaurants and other entertainment.
“I already was spending a ton on gas,” she said. “But now it’s absolutely ridiculous.”
The average price for a gallon of regular gasoline Monday was $3.79 — up more than a dime from the previous week and 93 cents from a year earlier, according the Energy Information Administration. In California, the average is now $4.16, and prices are above $4 a gallon at some stations in the District and elsewhere.
Prices have risen so high, so fast that some market analysts predicted a sell-off in the short term. That sentiment sent crude oil prices tumbling Tuesday for the second consecutive day, dragging stock markets down about 1 percent, as evidence grew that escalating prices are beginning to threaten the global economic recovery.
Stephen Gandel writing for Time Magazine suggests that this price level might be the “breaking point”. This analysis uses the average amount that American consumers generally budget for gas.
Americans are spending much more than they typically do at the pump. Relatively high gas prices have made that a problem throughout this recession, but the recent increase has only made it worse. For the past 19 years, (that’s as far back as the Census data, where retail sales come from would let me go) on average Americans have spent about 8% of their overall retail purchases on gas and other gas station related items. The number has generally been around 9% this recession. And in March, for the first time since the beginning of the recession, that number hit 11%. The highest the figure has been in the past 19 years is 12% and that was in March 2008, which is when Bear Stearns collapsed and was really the start of the financial crisis. It stayed at 12% until September 2008, when Lehman went under taking the rest of the economy with it.
But even 11% could be some sort of breaking point. The last time the figure rose to 11% was in November 2007. And that is right around the time when the economy shifted from creating jobs to losing them. What’s more, in past recoveries Americans in general have spent much less of their income on gas. In 1993 and 2003, for instance, Americans spent between 7% and 8% of their purchases at gas stations.
Our Contrived Fiscal Crisis and the President who buys into it …
Posted: April 13, 2011 Filed under: 2012 presidential campaign, Barack Obama, Breaking News, Catfood Commission, Economy, Federal Budget and Budget deficit | Tags: budget cuts, Budget Deficit, Federal Budget 44 CommentsFederal deficits always go up big and automatically during two events. That would be wars and recessions. We have 
had two wars going on for about 10 years now and we’ve had the deepest recession since World War 2. Getting rid of the two wars and solving the residual problems of unemployment would eliminate any potential future fiscal crisis. Any economist will tell you this. It’s not a secret we keep from the world. Passing huge tax cuts and laws that remove nearly all capital and all types of businesses incomes from the pool of revenue sources only exacerbates the revenues problems you get during recessions and expenditure run-ups that come from running wars.
We’ve had excessive war spending before. Our country was born with a lot of money borrowed from the Dutch. The Civil War and both World Wars–especially number two–placed our federal deficit and debt at astronomical levels of GDP. Did our country crash and burn because of the actions of John Adams, Abraham Lincoln or the spending during World War 1 or World War 2? Did you feel that life in the 1950s and 1960s and the children born then were oppressed by excessive debt?
Of course not.
Federal Debts and Deficits are functions of the size and health of the economy underlying the obligations. We have plenty of taxable assets and businesses making money. You can tell how risky the market for our Federal debt is by looking at the yields on Government bonds and Treasuries. The current yields for Treasuries are listed right here. They are at near historic lows and they are still selling. Nothing in that market indicates any reticence by any participant to buy American Debt obligations. The ability to tax and raise taxes as well as print money is a unique function of government. We can do both. If we’d have let the Dubya Bush tax cuts just expire we would’ve closed the deficit gap and reduced the debt by more than anything than is on the table right now. That would include the disingenuous and malfeasant Ryan plan. It also includes the the one that will come from the White House today at 1:35 est.
We need to put taxing capital back on the table. That includes dividends, capital gains, and vast inheritances and trust funds. We need to remove tax loopholes and subsidies to corporations. We do not need to remove the last vestiges of safety nets standing. There appears to be no one brave enough in Washington DC to say that but I will join the bow tie set in shouting just that. It is time to stop subsidizing incompetent business owners and time to invest in the country and its people. Washington DC has the nation’s priorities all wrong.
The White House provided no more specifics on the four steps to be offered in his afternoon speech at George Washington University. But an official said his plan would “borrow” from the recommendations of the 2010 fiscal commission that Obama empaneled, but whose proposals he never fully embraced.
“The president will make clear that while we all share the goal of reducing our deficit and putting our nation back on a fiscally responsible path, his vision is one where we can live within our means without putting burdens on the middle class and seniors or impeding our ability to invest in our future,” the official said.
Republicans–as eloquently stated by former budget Director David Stockman–have a tax fetish. Republicans are refusing to put any taxes on the table. Rand Paul is considering filibustering the increase in the debt ceiling. It appears some of these folks are so disturbingly ideological and economics-disabled that they will let the US go “bankrupt” in the only way possible it could do so. They will allow the US to default on its debt obligations. The Republican Party seems ruled by insane people at the moment. The Democrats, however, are ruled by folks that appear to be playing into right wing memes to appeal to some independents. So, why are we only left with poisonous choices?
Some of the Democratic base is finally waking up to the truth about Obama. He has no core Democratic values. We’re about to see a Democratic president put the cornerstones of Democratic policy on the bargaining table in an effort to appease some folks during the re-election cycle. I’m wondering if it’s all not just a little too late. Ever since the real economists left the building, White House Policy has grown more and more Republican.
Key liberal groups, which helped elect Obama in 2008, are raising concerns that he has given up political ground to Republicans, allowing the message of reducing government to trump that of creating jobs and lowering the unemployment rate.
Seizing on Friday’s deal, which would cut $38.5 billion from the fiscal 2011 budget, activists on Tuesday threatened to sit out the 2012 presidential campaign if Obama goes too far with further cuts.
“The fundamental problem in our country right now is unemployment and a jobs crisis, not a deficit crisis,” said Deepak Bhargava, executive director of the Center for Community Change, an advocacy group for the poor. “It appears the president is fighting on the wrong terrain and is conceding that the only thing we should be talking about is how to bring down the deficit.”
The clash over government spending — coming as Obama prepares to make a major speech on fiscal discipline Wednesday — is the latest example of the frayed relations between the president and a broad coalition of union and activist groups.
The details of the budget compromise as well as the way that the Health Care Reform act was rammed through congress have shown that Obama is more than eager to get something, anything passed than to fight for reform that would actually reflect either public opinion or traditional Democratic Values. Poor black women from the District of Colombia were nearly the first ones thrown under the budget cutting bus. Which previous US Democratic President would have sold them out?
To get the trade-off on the policy riders, Democrats had to give on spending — to the tune of the largest budget cuts ever. There’s a $1.1-billion cut across the board for discretionary spending and dozens of nips and tucks all over government, from Justice Department programs to subsidies for co-ops in the new health care law to the Pell Grant program for low-income college students.
I am going to watch this speech. I’m only hoping some of the disgruntled chat coming from real Democrats materializes into something substantive after it happens.
DeFazio said Monday that Democrats haven’t put enough pressure on Obama.
“That’s what the House did wrong in the last Congress, and in part why we lost is we never pushed back, no matter how wrong he was or how off-base he was; we never pushed back,” DeFazio told MSNBC.
“There are a number of us in the caucus now pushing back very hard on our leadership,” DeFazio said. “Who knows where they’ll end up, but maybe we can take enough D’s with us to make them uncomfortable and to make them stick with making the president act like a Democrat.”
The Democrats’ frustration with Obama is hardly new. Liberals were furious in December when the president caved to GOP demands that Congress extend tax cuts for the wealthiest Americans. More recently, many liberals have questioned the wisdom and constitutionality of launching military attacks on Libya with prior approval from Congress.
Behind closed doors, Democratic leaders are frustrated that Obama hasn’t been more involved in the big policy fights of recent months, including the spending battle.
The way to get to this President is through his re-election efforts and his ego. Hopefully, a few groups will stop facilitating the cave-ins and start fighting for the country’s interests. You can watch the President’s speech on CSPAN at this link. I have my bucket o’ Nerf balls ready and I’m warming up for the first pitch of the 2012 presidential campaign season. Join me as we share the pain and none of the gain.
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