Taxpayer Dollars Spent On Food Stamps Has Doubled Since Obama Took Office – 100% Increase – Estimated Cost Over Next 10 Years Is $770 Billion

June 8, 2012

WASHINGTON, DC – The vast majority of federal spending in the Senate farm bill, which is estimated to cost over $100 billion annually, is going toward food stamps, representing a 100 percent increase since President Barack Obama took office, according to Alabama Republican Sen. Jeff Sessions.

“This legislation will spend $82 billion on food stamps next year, and an estimated $770 billion over the next ten years. To put these figures in perspective, we will spend $40 billion federal dollars next year on roads and bridges,” said Sessions, the ranking member of the Senate Budget Committee.

“Food stamp spending has more than quadrupled since the year 2001. It has increased 100 percent since President Obama took office,” he said.

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Federal Accounting Slight Of Hand Hides Real Federal Deficit: $5 Trillion Last Year – Four Times What Congress Reported – Equal To $42,054 Per Household

May 24, 2012

WASHINGTON, DC – The typical American household would have paid nearly all of its income in taxes last year to balance the budget if the government used standard accounting rules to compute the deficit, a USA TODAY analysis finds.

Under those accounting practices, the government ran red ink last year equal to $42,054 per household — nearly four times the official number reported under unique rules set by Congress.

A U.S. household’s median income is $49,445, the Census reports.

The big difference between the official deficit and standard accounting: Congress exempts itself from including the cost of promised retirement benefits. Yet companies, states and local governments must include retirement commitments in financial statements, as required by federal law and private boards that set accounting rules.

The deficit was $5 trillion last year under those rules. The official number was $1.3 trillion. Liabilities for Social Security, Medicare and other retirement programs rose by $3.7 trillion in 2011, according to government actuaries, but the amount was not registered on the government’s books.
Contrasting deficits

The federal government calculates the deficit in a way that makes the number smaller than if standard accounting rules were followed (in trillions).

Deficits are a major issue in this year’s presidential campaign, but USA TODAY has calculated federal finances under accounting rules since 2004 and found no correlation between fluctuations in the deficit and which party ran Congress or the White House.

Key findings:

•Social Security had the biggest financial slide. The government would need $22.2 trillion today, set aside and earning interest, to cover benefits promised to current workers and retirees beyond what taxes will cover. That’s $9.5 trillion more than was needed in 2004.

•Deficits from 2004 to 2011 would be six times the official total of $5.6 trillion reported.

•Federal debt and retiree commitments equal $561,254 per household. By contrast, an average household owes a combined $116,057 for mortgages, car loans and other debts.

“By law, the federal government can’t tell the truth,” says accountant Sheila Weinberg of the Chicago-based Institute for Truth in Accounting.

Jim Horney, a former Senate budget staff expert now at the liberal Center on Budget and Policy Priorities, says retirement programs should not count as part of the deficit because, unlike a business, Congress can change what it owes by cutting benefits or lifting taxes.

“It’s not easy, but it can be done. Retirement programs are not legal obligations,” he says.

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Pending Fiscal Crisis – Tax Increases And Spending Cuts On The Near Horizon – Congress To Decide How US Can Best Continue Spending Money It Doesn’t Have

May 23, 2012

WASHINGTON, DC – For Congress, the outlines of the pending fiscal crisis are clear: Don’t do a thing, and watch the economy slip into a double-dip recession early next year. Or cancel the looming tax increases and spending cuts, watch the deficit rise, and push the government ever closer to a European-style debt crisis.

That decision was put in stark terms Tuesday by the Congressional Budget Office, which in a new analysis said the economy will plunge into a recession early next year if Congress lets taxes rise and spending be cut, as called for under the law.

But if Congress changes the law to keep taxes low and spending high, it could add more than half a trillion dollars to the deficit in 2013, marking a fifth straight year of trillion-dollar deficits and risking the patience of the country’s creditors.

The CBO numbers come just as the debate is heating up on Capitol Hill over how to handle the looming “fiscal cliff,” which Congress created by continually pushing off tough decisions on both taxes and spending.

Senate Majority Leader Harry Reid, Nevada Democrat, signaled Tuesday that he will allow the automatic spending cuts called for in last year’s debt deal to go into effect — culling billions of dollars from defense and domestic spending — unless Republicans agree to allow taxes to increase on at least some taxpayers.

“If Republicans want to walk away from the bipartisan spending cuts agreed to last August, they will have to work with Democrats to replace them with a balanced deficit-reduction package that asks millionaires to pay their fair share,” Mr. Reid said.

Republicans remain adamant that the lower income- and investment-tax rates passed in 2001 and 2003 under President Bush, and extended in 2010 under President Obama, must be extended again.

“No economy can sustain such a hit without being hurled into recession,” said Sen Orrin G. Hatch, the ranking Republican on the Senate Finance Committee, which oversees tax policy.

One thing both sides say they agree on, however, is the need to act now.

Last week, House Speaker John A. Boehner kicked off the conversation, drawing a line in the sand in saying that he won’t allow another increase in the federal government’s debt ceiling unless it’s matched dollar-for-dollar with future spending cuts — just as the 2011 debt deal was.

Mr. Boehner also signaled he was open to ending some special tax breaks, as long as the money was used to bring down tax rates for everyone. He acknowledged there would be some who would pay more and some who would pay less.

But Democrats said much of the extra money the government would generate by closing those loopholes should go to funding the promises already made on spending, such as Social Security, Medicare and regular domestic spending.

The government was projected to see a large surplus at the end of the Clinton administration, but several economic downturns, two wars, several rounds of tax cuts and trillions of dollars in new domestic spending erased the surplus and have left the government deeply in debt: $15.715 trillion as of Monday.

And for the past three years, as political gridlock has become the rule in Washington, lawmakers have put off decisions on cutting spending or raising taxes, leaving everything to bite at the beginning of 2013.

The list of expiring laws reads like a taxpayer’s worst nightmare: The alternative minimum tax would bite ever deeper, last year’s 2-percentage-point payroll-tax cut would disappear, business-investing tax breaks would end, and almost all of the 2001 and 2003 tax cuts would expire. Meanwhile, some tax increases from Mr. Obama’s health care law are slated to begin biting in January.

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Congressional Budget Office Predicts “Recession” Beginning In Early 2013

May 22, 2012

WASHINGTON, DC – The nonpartisan Congressional Budget Office (CBO) said Tuesday that unless lawmakers act to prevent scheduled tax increases and spending cuts at the end of the year, a recession will likely result in early 2013.

Early next year income taxes are set to go up when the Bush-era tax rates expire. Automatic spending cuts totaling roughly $109 billion triggered by last August’s debt-ceiling deal are set to hit. Meanwhile, payments to physicians under Medicare will be slashed.

CBO projects that these and other elements of the so-called “fiscal cliff” will cause the economy to contract as demand dries up.

It projected in a Tuesday report that the gross domestic product (GDP) will contract by 1.3 percent in the first half of 2013 before growing 2.3 percent later in the year. Annualized, GDP would grow just 0.5 percent in 2013.

“Given the pattern of past recessions as identified by the National Bureau of Economic Research, such a contraction in output in the first half of 2013 would probably be judged to be a recession,” the report states.

A recession is technically defined as two economic quarters of negative economic growth.

This is the first time CBO has forecast a recession resulting from the fiscal cliff. In January it saw 1.1 percent GDP growth in 2013 if policies are not dealt with.

If Congress and the White House turn off all the automatic cuts and the tax increase, growth would rise to 4.4 percent, CBO predicted in the report released Tuesday.

The CBO projections appear to go further than other policymakers have gone in stating the economic risks of lawmakers failing to act.

Fed Chairman Ben Bernanke has warned of the risk to the economic recovery.

“It’s very important to say that, if no action were to be taken by the fiscal authorities, the size of the fiscal cliff is such that I think there’s absolutely no chance that the Fed could or would have any ability to offset, whatsoever, that effect on the economy,” Bernanke told reporters in April. “I am concerned that if all the tax increases and spending cuts that are associated with current law would take place, absent congressional actions … that’d be a significant risk to the recovery. “

Keeping the automatic cuts and tax increase in place would reduce the deficit by $607 billion in 2012 and 2013, CBO notes.

Unless future spending cuts are made, the national debt would grow at unsustainable rates and hurt long-term growth in that scenario, CBO warned.

Democrats and Republicans are in a standoff over fiscal issues and are unlikely to tackle the “fiscal cliff” until after the November elections. Lame-duck action could be limited to punting most issues into 2013 by extending current policies temporarily.

The White House said the CBO report shows that Congress should adopt President Obama’s overall budget plans.

“The President has put forth his plan to keep the recovery going now and reduce the deficit by more than $4 trillion over the next decade. Congress should act to avoid the scenario CBO lays out by putting forth balanced deficit reduction that meets the test of fairness and shared responsibility,” Office of Management and Budget spokesman Ken Baer said.

Last week, House Speaker John Boehner (R-Ohio) called on Congress and the White House to work out a long-term deficit deal and threatened not to raise the nation’s debt ceiling next year unless a greater amount of spending cuts is enacted.

In a Tuesday opinion piece in USA Today Boehner blamed President Obama for the failure to lock in a long-term fiscal solution last year.

“The president lost his courage, and the country lost its gold-plated triple-A credit rating for the first time,” Boehner wrote. “Since then, the president has been in campaign mode — playing small ball at a time when we need to address big challenges.”

House Budget Committee ranking member Rep. Chris Van Hollen (D-Md.) said the CBO warning means the Democratic path should be followed.

“It is clear that we need to act and we must do so in a balanced way,” he said.

“Given this report, Speaker Boehner’s threat to prevent the United States from paying its bills unless Republicans are able to impose additional economy-slowing austerity measures is especially reckless and irresponsible,” Van Hollen said.

House Majority Leader Eric Cantor (R-Va.) speaking on Fox News Tuesday said Congress should give certainty to the economy by canceling the scheduled tax increases now, but if it does not the public will have a clear choice in November.

“We are going to try every way we can to make sure taxes don’t go up on anybody,” Cantor said. “And so that is why we are saying this election, really, is much about the fact that if people do not want their taxes going up, they have got to vote to make sure that they don’t. And that is a vote for Mitt Romney.”

Earlier this month the House passed a bill replacing $78 billion of the $109 billion in automatic across-the-board spending cuts with a package of cuts to social programs over 10 years. Boehner has said the House will pass an extension of all the Bush-era tax rates before the election.

Those GOP actions are unlikely to be taken up in the Senate.

The White House and Senate Democrats want to end the tax breaks for the wealthy but extend them for the middle class. Democrats want the automatic spending cuts to be replaced by cuts less focused on social programs and revenue from ending tax breaks, including for oil and gas companies.

Senate Majority Leader Harry Reid (D-Nev.) said the CBO report means that the GOP should extend the middle class tax rates and come to the table ready to compromise with Democrats.

“We could avoid the so-called fiscal cliff tomorrow if Republicans would agree to extend the middle class tax cuts, which would provide certainty to millions of families and give us ample time to deal with the other challenges facing Congress at the end of the year,” he said. “If Republicans want to walk away from the bipartisan spending cuts agreed to last August, they will have to work with Democrats to replace them with a balanced deficit reduction package that asks millionaires to pay their fair share.”

Also on Tuesday, Reid wrote to Senate Republicans to say that action on debt issues appears to be “impossible” before the election so long as Republicans continue to reject any new tax revenue as part of a way to chart a new fiscal course.

“The American people want a balanced approach to fiscal policy that combines smart spending cuts with revenue measures that ask millionaires and big corporations to pay their fair share,” Reid wrote. “Yet a strict adherence to Tea Party ideology among Republicans in both the House and the Senate has so far put that balanced, common-sense solution out of reach.”

“It is imperative for both sides to rally around a long-term fiscal agreement that includes revenues,” Sen. Charles Schumer (D-N.Y.) said in a release. “A stopgap deal that just kicks the can down the road is not much better than pure deadlock.”

Deficit hawks have been hoping that lawmakers would put their differences aside and come up with a compromise along the lines of the Bowles-Simpson deficit commission, which sought to reform the tax code while trimming some entitlement benefits.

Reacting to the CBO report, the Center for a Responsible Federal Budget’s Maya MacGuineas said “you can only hope that as we march down a treacherous path between a fiscal cliff-recession and a mountain of debt, lawmakers are hard at work to come up with a workable solution, rather than taking the year off with the excuse that it is an election year.”

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President Obama’s Budget Fails To Attract A Single Vote In Senate 99-0 – Previous House Vote In March Was 414-0

May 17, 2012

WASHINGTON, DC – President Obama’s budget suffered a second embarrassing defeat Wednesday, when senators voted 99-0 to reject it.

Coupled with the House’s rejection in March, 414-0, that means Mr. Obama’s budget has failed to win a single vote in support this year.

Republicans forced the vote by offering the president’s plan on the Senate floor.

Democrats disputed that it was actually the president’s plan, arguing that the slim amendment didn’t actually match Mr. Obama’s budget document, which ran thousands of pages. But Republicans said they used all of the president’s numbers in the proposal, so it faithfully represented his plan.

Sen. Jeff Sessions, Alabama Republican, even challenged Democrats to point out any errors in the numbers and he would correct them — a challenge no Democrats took up.

“A stunning development for the president of the United States in his fourth year in office,” Mr. Sessions said of the unanimous opposition.

The White House has held its proposal out as a “balanced approach” to beginning to rein in deficits. It calls for tax increases to begin to offset higher spending, and would begin to level off debt as a percentage of the economy by 2022. It would produce $6.4 trillion in new deficits over that time.

By contrast the chief Republican alternative from the House GOP would notch just $3.1 trillion in deficits, and three Senate Republican alternatives would all come in below $2 trillion.

The Senate is holding votes Wednesday on Mr. Obama’s budget, the House GOP’s budget and the three Senate Republican alternatives. None was expected to gain the 50 votes needed to pass the chamber.

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Half Moon Bay California Decides To Ditch It’s Costly Police Department To Balance City’s Books

April 3, 2011

HALF MOON BAY, CALIFORNIA – City officials decided to outsource the local police and recreation departments Saturday.

To many, it felt like they were cutting out the city’s heart as well.

Police Sgt. Dennis Loubal broke down and wept at the microphone as he struggled to express how painful it would be for him to give up the Half Moon Bay police uniform he’d been wearing for the past 14 years. In spite of that, he said the city ought to contract with the San Mateo County Sheriff’s Office; it would save the city $509,000 and balance the budget.

Loubal and the rest of the sworn officers would retain their jobs under the proposal submitted by the county, but it just won’t be the same.

“I’ve been serving this community, and I know I’ll be rotated out,” he said.

Several residents wiped away tears as they sat and listened, including another police officer and the city’s mayor, Naomi Patridge, who had to leave the dais to control herself.

Half Moon Bay will begin negotiating with the city of San Carlos to take over its recreation services and work out contract details with the Sheriff’s Office, which already patrols the rest of the Coastside north and south of Half Moon Bay. The changes will save the city $700,000 each year, a sizable chunk of change in a municipality with a $9.7 million budget. The police department accounts for one-third of that budget.

Everyone knew this day was coming. It’s been coming for four years, ever
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since U.S. District Court Judge John Walker dealt the city a devastating $41 million judgment in a land-use case infamously known as Beachwood. The city then settled the suit for $18 million, which it will be paying off for the next 30 years.

Then the economic crisis wiped out the coastal city’s crucial hotel tax revenue, numbers that are just starting to rebound.

“Had the lawsuit not occurred, we could have ridden out the wave,” Councilwoman Marina Fraser said after the meeting.

The city tried to cope. It cut or outsourced half its staff, including much of its engineering and public works departments. Employees who remain are required to take 28 furlough days per year. The City Council put a sales tax increase on the ballot as a final bulwark against losing its police department, but voters defeated the measure last year.

The reason Half Moon Bay chose to incorporate in 1959 was to have its own police force. In 1961, Patridge became the new department’s first police matron.

“For me, it’s been a tough pill to swallow,” she said.

As difficult as Saturday was for everyone at the meeting, there’s more heartache on the horizon. The new contracts will replenish the city’s reserve, but that fund will be wiped out again by 2013-14 unless officials uncover a major new source of revenue or make further cuts.

By then, the city will have $4 million in deferred capital improvement expenses and vastly increased employee retirement and workers’ compensation costs, according to City Manager Laura Snideman.

As it considers its future, Half Moon Bay has no more sacred cows.

City Council members talked about moving out of City Hall — possibly into police headquarters, which may soon be vacant — and leasing the building to the highest bidder. Officials will seek further concessions from beleaguered city staff.

They even suggested contracting with the county for a new planning department, one that would serve Half Moon Bay along with the entire unincorporated Coastside.

“The community needs to understand we still have serious problems on the horizon,” said Councilman Rick Kowalczyk. “This is just step one.”

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New Alabama Budget Will Require Releasing 3000 Non-Violent Prison Inmates – State May Try Justifying Releases With “Sentencing Reform”

March 30, 2011

ALABAMA – The state finance director says 3,000 non-violent Alabama prison inmates will have to be released if the Legislature adopts the General Fund budget proposed by Gov. Robert Bentley.

Finance Director David Perry told a joint meeting of the House and Senate judiciary committees that the cuts required in the governor’s budget will force a reduction in the number of prison inmates.

Perry made the dire pronouncement Wednesday as members of the two judiciary committees were discussing a package of bills supported by Chief Justice Sue Bell Cobb that are aimed at reforming Alabama’s sentencing procedures and reducing the number of prison inmates.

Perry told committee members that releasing prisoners because of sentencing reform would be “more responsible” than letting them go because of budget cuts.

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