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Speaking to reporters Tuesday morning, White House press secretary Jay Carney indicated the Obama Administration wasn’t even considering the proposed stopgap because the president would rather get an agreement on spending for the rest of the year.
To that end, President Obama hosted both Republican and Democratic congressional leaders at the White House Tuesday to try and get the sides to an agreement.
Democrats wanted Republicans to move off their insistence that a spending agreement reflect the $61 billion in spending cuts as well as a number of restrictions on domestic policy, like a ban on Planned Parenthood funding, contained in HR1, legislation the House passed in February. Democrats like their spending cut proposal of $33 billion more and hate the Republican policy riders.
It appears that the Tea Party wants what the Tea Party has always wanted, namely $100 billion in cuts. Democrats, including President Obama, say they’re willing to offer the $73 billion Speaker Boehner originally proposed. Senator Reid says he’s been invited to a 4 p.m. meeting about the budget, as the last chances to avoid a government shutdown get much closer. “I’m not real optimistic,” he said.
Harry Reid, speaking to reporters just now, went public with this charge, claiming:
“We thought for several days that we were very close to an agreement, but the meeting at the White House and the negotiations over the weekend really indicated to me and I think most people who are watching this that the leadership in the House is being guided by the tea party. They’re saying they won’t agree to anything unless they get 218 Republican votes. We all know that’s a nonstarter. We couldn’t have passed the last short-term C.R. if that were the case. We have been willing to compromise at $73 billion. Our problem is, we cannot agree to take all that from domestic discretionary spending. This $73 billion was the Republicans’ original proposal. So I guess they were for it before they were against it. But now they’re moving the goal post again.”
1) Discretionary spending
a) Non-defense discretionary: Brings spending back to pre-2008 levels and freezes it there for five years.
b) Defense-related discretionary: Echoes Obama’s budget request in accepting the $78 billion in “savings” that Defense Secretary Robert Gates identified and going no further. I put “savings” in quotation marks because it’s really a reduction in the growth rate that Gates previously requested.
2) Financial system
a) Financial regulation: Repeals Dodd-Frank.
b) Fannie Mae and Freddie Mac: “This budget . . . proposes eventual elimination of Fannie Mae and Freddie Mac, winding down their government guarantee and ending taxpayer subsidies. It supports increasing the guarantee fees Fannie and Freddie charge lenders in order to bring private capital back, shrinking their retained portfolios, and enacting various measures that would bring transparency and accountability to the GSEs.”
3) Safety net
a) Medicaid: Converts federal share of Medicaid spending into a block grant that’s indexed for inflation and population growth. To offer some context, health-care costs often increase at twice the rate of inflation or more.
b) Supplemental Nutrition Assistance Program: Better known as food stamps, SNAP gets the Medicaid treatment: block grants indexed for inflation and population growth.
c) Pell Grants: Cut back to 2008 levels, wiping out recent increases.
d) Health-care reform: Repeals the Affordable Care Act.
4) Retirement security
a) Medicare: Privatizes Medicare. Future beneficiaries will choose from a menu of private options. They won’t have the choice of the standard Medicare plan. Wealthier beneficiaries will get a small voucher and poorer beneficiaries will get a larger voucher. Vouchers grow at GDP+1%, whether or not Medicare does the same.
b) Social Security: Calls for a bipartisan process to develop reforms.
a) Tax reform: “Reform the tax code by consolidating the current six brackets and cutting the top individual rate from 35 percent to 25 percent.”
b) Tax revenue: Prevents the Bush tax cuts from expiring in 2013. So the revenue-neutral tax reform locks in today’s rates, which is to say it makes the Bush cuts permanent.
c) Corporate taxes: Lowers corporate tax rate from 35 percent to 25 percent. “This budget would offset lower rates with a broader base, scaling back or eliminating entirely the deductions.”
Endorses “The American Energy Initiative”: I don’t know much about this bill, but you can find the GOP’s official case for it here.
The plan includes a giant tax cut for the wealthy, as well as a complete dismantling of Medicare and Medicaid.
But it also includes a gift for Wall Street, in the form of a repeal of the provisions of the Dodd-Frank financial reform law that protect taxpayers from having to bail out failed financial institutions.
The provisions in question — which Ryan dubbed “permanent bailout authority” in a Wall Street Journal op-ed today, reviving a key GOP talking point from the financial reform debate — are actually two distinct parts of the financial reform law. The first allows the Financial Stability Oversight Council (FSOC) to designate some firms as systemically significant and subject them to stiffer regulation.
The second, known as resolution authority, allows the Federal Deposit Insurance Corp. to unwind failing firms that, because they are so large and interconnected, can’t go through traditional bankruptcy. The FDIC recoups any costs incurred by selling off the assets of the company that was dissolved. The big bank lobbying groups — including the American Bankers Association and the Financial Services Roundtable — oppose resolution authority. “You don’t want to create a system that raises great uncertainty and changes what institutions, risk management executives and lawyers are used to,” said Edward Yingling of the American Bankers Association.
These provisions correct two key problems that plagued the pre-2008 financial system: giants firms didn’t have to adhere to stricter standards and the government had no tools to unwind them when they failed. The House GOP budget would return the regulatory system to this standard.
When asked which programs they were willing to see cut by Congress, 91% of Americans said they wanted to see no or only minor reductions in Medicare and 86% wanted to see no or only minor reductions in Medicaid, according to a recent poll by the Kaiser Family Foundation.
The Republican budget clearly doesn’t share the priorities of the American people.
President Barack Obama called on Republican and Democratic Congressional leaders on Tuesday to “act like grown-ups” and put aside their differences on a six-month spending bill.
In an impromptu news conference at the White House, Obama bluntly criticized the pace of talks and argued it is up to himself, Speaker John Boehner and Senate Majority Leader Harry Reid (D-Nev.) to quickly come to terms on a bill to avoid a government shutdown.
“There are some things that we can’t control. We can’t control earthquakes, we can’t control tsunamis, we can’t control uprisings on the other side of the world. What we can control is our capacity to have a reasoned, fair conversation between the parties and get the business of the American people done,” Obama said.
“And that’s what I expect,” he added.
Obama also rejected a one-week stopgap spending measure being pushed by House Republicans, saying he would only support a two- or three-day extension to allow negotiators to finish their work.
“We are now at the point where there’s no excuse to extend this further. If over the next 24 to 48 hours a deal is done and we just can’t get the paperwork through Congress quick enough, and they want to do a clean extension for two or three days in order to go ahead and complete a deal, then that’s something that we could support,” Obama told reporters.
“But what we’re not going to do is to once again put off something that should have gotten done several months ago.”
Boehner, who introduced the one-week bill late Monday, declined at his own news conference Tuesday to say whether he would support a shorter extension. “We will continue to assess where we are in the next few hours and next few days,” he said.
Boehner also issued his most emphatic rejection of a proposed six-month bill that would cut $33 billion in spending. Although negotiations have been based for days on a top-line reduction of $33 billion, the Ohio Republican ruled that level out Tuesday.
Democrats “like to insist that $33 billion is their top number and to use smoke and mirrors to get there. That is not acceptable to our members,” Boehner said.
Additionally, Boehner acknowledged that including a host of controversial policy riders in the final spending bill is as important to Republicans as is cutting spending. The riders were included in a House-passed spending bill that included $61 billion in cuts. That measure stalled in the Senate.
Reid rejected Boehner’s one-week proposal Tuesday.
“It’s really time to get the job done. Republicans need to stop clinging to a bill that has already been defeated in the Senate. That bill is a non-starter. They have trouble divorcing themselves from that ideologically driven H.R. 1. They’re having a lot of trouble doing that. But we know the bill is awful,” Reid said.
According to a Federal Aviation Administration press release on April 4, the FAA is issuing an emergency directive on April 5. Operators of certain Boeing 737 models must immediately carry out electromagnetic inspections for metal fatigue.
Southwest Airlines Flight 812 was en route from Phoenix to Sacramento on April 1 when the cabin depressurized. A hole had opened in the top of the aircraft. The flight landed safely in Yuma, Arizona. One flight attendant was injured, but not seriously, according to a statement from Southwest.
The brand new Tax Cut Calculator provides an easy to use tool that shows individuals and families how these tax cuts – some of which are hitting paychecks right now– will affect their taxes for 2011. The Calculator shows the benefits of the Payroll Tax Cut, which is putting more money in the pockets of millions of workers across the country already. It also illustrates how families can benefit from three Recovery Act tax cuts that the President fought to extend – the American Opportunity Tax Credit (AOTC) and the expanded Earned Income Tax Credit (EITC) and Child Tax Credit.
Enough explanation, though! Take a moment to try the tax cut calculator for yourself.
A new analysis by Oakridge National Laboratory (ORNL) says that America could generate 12.6 gigawatts of always-on baseload power just by adding electrical generation capacity to existing dams that don’t already have it. That’s 12 (big) nuclear reactors’ worth — the average reactor at the Fukushima Daiichi plant produced only 0.78 GW.
Much of that power-generating capacity is low-hanging fruit: ORNL estimates that even if you focused only on the country’s 100 biggest non-electrified dams, you could still generate 8 gigawatts of power. That’s four times as much as the Indian Point nuclear power plant, which provides 30 percent of the electricity used by New York City and Westchester county.
Historically, hydropower has been seen as a dead end in the race to replace fossil fuels with renewables. A 2002 analysis by the Union of Concerned Scientists says that “The impact of very large dams is so great that there is almost no chance that any more will be built in the United States,” and “… hydropower is almost certainly approaching the limit of its potential in the United States.” But ORNL isn’t talking about building more dams — just getting more out of the existing ones.
This is a non-interactive version of the chart. Also check out the interactive version.
In addition to acknowledging that seniors, disabled and elderly people would be hit with much higher out-of-pocket health care costs, the CBO finds that by the end of the 10-year budget window, public debt will actually be higher than it would be if the GOP just did nothing.
Under the so-called “extended baseline scenario” — a.k.a. projections based on current law — debt held by the public will grow to 67 percent of GDP by 2022. Under the GOP plan, public debt would reach 70 percent of GDP in the same window.
In other words, the spending cuts Republicans would realize in the first 10 years would be outpaced by deficit increasing tax-cuts, which Ryan also proposes. After that, debt projections under the plan improve decade-by-decade relative to current law. That’s because 2022 would mark the beginning of the Medicare privatization plan. That’s when, CBO finds, “most elderly people would pay more for their health care than they would pay under the current Medicare system.”
If the current Medicare system were allowed to continue, CBO found that an average 65-year-old beneficiary’s costs would be only 25 percent of what it’d be in the individual private insurance market. Under the GOP plan, those costs would jump to 68 percent.
In plain English, “the gradually increasing number of Medicare beneficiaries participating in the new premium support program [the GOP’s Medicare privatization plan] would bear a much larger share of their health care costs than they would under the current program.”
Abolishing Medicare = “Saving Medicare”
Let’s remember what this is about. Using the deficits created by the financial crisis to eliminate Medicare, Medicaid and if at all possible, Social Security too.
It’s actually quite analogous to what happened in Wisconsin over the last couple months. The state faced a serious budget shortfall. Cuts were necessary on various fronts. Some of those certainly had to come from the state’s public workers. Bigger contributions to health care coverage, pensions, etc. The state’s public employees union basically agreed. But in addition to the budget retrenchment that was necessary, at least to some degree, Governor Walker said, “Hey, as long as we’ve got a budget situation why not just abolish the unions and say it was necessary to balance the budget? We’ll never get a better chance to shut them down?”
Rep. Ryan, an ally of Gov. Walker, is trying pretty much the same thing.
Rep. Paul Ryan says his plan to slash entitlement programs will hand Democrats a “political weapon.”
The truth is that the Republicans’ fiscal 2012 budget, due for release tomorrow, is a calculated political gamble that will define the fiscal battleground for the next two years.
Ryan told FOX News Sunday that Democrats will use his budget as a “political weapon,” but that they will have to “lie and demagogue to make it a weapon against us.” The big fear is that his plans for Medicare, the health insurance program for the elderly, will be painted as an effort to rob old folks of their retirement security.
Democrats, who cut Medicare subsidies to insurers to help offset the costs of the new health care law, are sure to hit Republicans for tinkering with the programs for the elderly and the poor.
“They think it’s politically easy to go after the most vulnerable of the vulnerable,” Van Hollen told POLITICO.
That’s because the poorest voters, those who receive Medicaid assistance, aren’t up for grabs on Election Day. They heavily favor Democrats, as Obama proved when he won 73 percent of the votes cast by folks with family incomes of less than $15,000.
On the other hand, Medicare and Social Security recipients come from all income levels and political backgrounds — meaning messing with their benefits is a tricky business.
Nothing riles up the conservative base like going after the president’s new health care law. But even more important, the effort unifies the entire Republican Party. It’s a rare win-win at a time when the party’s establishment and its conservative base are still figuring out how to strike the right balance between ideology and governance.
Overall, the expansions of Medicaid and CHIP account for 43 percent of the increase in health care spending due to the Obama law over the next decade. That makes Medicaid a very, very fat target for savings — and just the kind of savings that bring ultraconservative Iowa Rep. Steve King (R-Iowa) and party moderates together.
One indication that GOP leaders see the new law as public enemy No. 1 for the entire party: The first big bill passed by the new Republican House majority this year would have repealed it altogether.
Governors Loving It
States knee-deep in red ink are feeling the budget crunch from the boost in federal Medicaid spending. Nationwide, CBO projects, roughly 17 million new customers per year will be eligible for Medicaid and CHIP under new eligibility standards. Because the program is a joint federal-state system, that means the costs are rising for states, too.
Republican governors, in particular, have been pushing for the federal government to give states a set amount of money and full flexibility to run the programs.
“We’re tired of having to come up to Washington to beg for waivers or even state plan amendments,” Mississippi Gov. Haley Barbour, a possible 2012 presidential contender, told reporters in February. “We want flexibility. For myself, I would take a capped block grant in return for true flexibility to run the program in the best way.”
That’s the kind of plan Ryan is expected to pursue.
In the past week, Republican communications operatives have worked to make sure reporters’ inboxes are full of quotations from former Democratic governors now in Congress or the administration who have appealed for changes to the system.
“Cash-strapped states might benefit from limiting the federal dollars for Medicaid resulting in a lesser state match requirement,” Hoagland says. “Hence, support for this policy would be greater with Republican governors and others struggling to control their own Medicaid costs.”
The CBO — which is the gold standard for budget analysis and number crunching on Capitol Hill — has issued a series of reports which conclude that the health care law will reduce the deficit and, by corollary, that repealing the health care law will cause the deficit to go back up.
This is a problem for Republicans, who dismiss CBO findings out of hand. Indeed, the budget they unveiled Tuesday morning relies on unofficial numbers to create the impression that repealing the health care law will reduce the deficit.
According to the GOP budget, repealing the health care law will reduce the deficit by $1.4 trillion by 2022. CBO, by contrast, holds that repealing the health law now will add well over $200 billion to the deficit over the same time frame.
It’s not clear where Ryan is getting his numbers. Asked about this disparity at a Capitol briefing Tuesday, House Budget chairman Paul Ryan claimed to have used CBO figures and not to have dictated assumptions to its analysts.
When the 112th Congress began, Republicans had to exempt health care repeal and other deficit busting ideas from their own House rules package, which nominally are intended to prevent new deficits.
It’s also worth pointing out that the budget also cites a Heritage Foundation study that claims Ryan’s plan will reduce unemployment to levels below full employment, which is impossible under central bank policy.
There was no one, single huge rally Monday that featured tens of thousands of supporters. Instead, the events were spread out from coast to coast and drew crowds in the hundreds and low thousands. But that kind of grassroots turnout shouldn’t have precluded coverage, considering the Beltway press showered attention on last week’s Tea Party event that drew “dozens” of supporters to Washington, D.C.
In terms of the news pages for national newspapers, USA Today and the Washington Post ignored the King-inspired rallies, according to a Nexis search. The Wall Street Journal’s print edition today also contained no mention, while the New York Times devoted 400 words to the union story.
On television, it was difficult to find many mentions of the pro-union events that commemorated the death of King, let alone catch any live reports. Glenn Beck did mention the rallies, but only to deride them as hot beds of socialist/communist activity.
Where the national press dropped the ball yesterday, the local press did a better job reporting on events in their community, as reports came in from all over the country yesterday.
In recent days, News Corp. has been a welcome host for the GOP to roll out Rep. Paul Ryan’s budget plan, with Fox News Sunday hosting Ryan to tout his proposal; The Wall Street Journal publishing an op-ed by Ryan hyping his “GOP Path to Prosperity”; and Sean Hannity hosting Ryan to discuss his plan to “save America,” among other Fox News appearances. Indeed, according to Politico, the GOP “choreographed” their rollout of Ryan’s proposal with these News Corp outlets.
Frum Forum (Republican):
Steve Ball has a great post on over at Frum Forum, talking about how the “true believers” on the right wing of the republican tent are setting themselves, and the country, up for failure. The silver lining of all this is they might just push more people towards the center.
Why are Republicans doing this to themselves?
If the GOP “true believers” continue to substitute nonsense for substance, they will do exactly the opposite of what they have set out to do. Eventually, they will isolate themselves, force the Republican leadership to make common cause with the moderate and conservative Democrats in both Chambers, and allow a true bi-partisan centrist landscape to develop in Congress.
That result—a true example of unintended consequences—would be good for the country and good for fiscal policy. Such a center, moving on its own without official endorsement of the leadership of either party or body, might actually begin to regain trust and credibility among American voters.
PRINCETON, N.J., April 5 (UPI) — Democrats and Republicans in Congress shared dismal approval ratings with the U.S. public, results of a Gallup poll indicate.
Results released Monday indicate 31 percent of respondents approve of congressional Republicans and 32 percent approve of congressional Democrats, among the lowest ratings for each party since Gallup first asked the question in 1999.
The nadir for Democrats was 30 percent in December 2007 and for Republicans was 25 percent in December 2008, the Princeton, N.J., polling agency said.
The poll found 63 percent of Republicans approving of the job the Republicans in Congress are doing, and 58 percent of Democrats approved of their party’s job. Fewer than three in 10 independents asked approve of either party in Congress.
He finds a strange new nervousness among Republican elites – especially if the GOP forces a government shutdown or a refusal to increase the debt limit. Money quote:
Look no further than late February’s NBC News/Wall Street Journal poll conducted by Democrat Peter Hart and Republican Bill McInturff… 75 percent of Republicans thought government was trying to do too much while 27 percent thought government should do more. But among independents, 51 percent thought government should do more, with 47 percent saying government was trying to do too much.
While those numbers among independents are effectively tied, they are a far cry from the 60-38 percent of independents who thought government was trying to do too much in the mid-October, preelection poll and a lot more like the numbers that existed in spring 2009, before Democratic prospects began to nosedive. That poll was conducted February 24-28 among 1,000 adults and has a 3-point error margin, larger among sub-groups.
Video and Photos from April 4th Events
AND IN OTHER NEWS…
Strahov Library 40 Gigapixels
Spend some time soaking in the ancient atmosphere of this 18th century library in Strahov Monastery in Prague.
This 360º Panorama is the largest indoor Photo in the world as of March 2011.
This image was created from 3,000 individual photos stitched together into a single image that is 280,000 x 140,000 pixels. That’s around 40 gigapixels, or 40,000 megapixels. If you printed this photo it would be 23 meters (or 78 feet) long!
To control this image, use the controls on the screen or click and hold your mouse button on the photo, and move your mouse around. To zoom in and out, use your mouse wheel, or the “Shift” and “Control” keys. Be sure to zoom in all the way to see the full detail of the photo!
Tell Congress not to divert scarce taxpayer dollars to vouchers. Fund programs that help all kids
Next National Days of Action: Tax Weekend April 15-18th!
On the weekend of tax day, April 15th-18th, let’s all take a stand for folks like Earl in our own communities. And let’s send our leaders a message- corporate tax cheats must pay up before veterans, the elderly, the unemployed, and the most vulnerable members of society are asked to sacrifice any more than we already have.
When it comes to paying their fair share of taxes, FedEx simply does not deliver. When FedEx made $1.9 billion in profits, they managed to pay less than .0005% of it in taxes by using 21 tax havens. FedEx also spent 42 times (4200%) more on lobbying Congress than they did in taxes.
When FedEx does not deliver on its fair share of taxes, we are forced to cut $373 million in teacher training programs (Americorp).
QUOTE OF THE DAY:
While the miser is merely a capitalist gone mad,
the capitalist is a rational miser. ~ Karl Marx