Free Republic

Mike Genest, who announced recently that he's resigning as Gov. Arnold Schwarzenegger's budget director, deserves a respite after four years of dealing with the state's chronic fiscal crisis. Genest is a genuinely nice guy,... His imminent departure, however, is a reminder that as Schwarzenegger settles on what he'll propose on state spending two months hence, California is still speeding toward a train wreck. The Legislature's budget analyst, Mac Taylor, will issue his appraisal soon. He'll probably tell his bosses what they don't want to hear – that things are getting worse, not better. State revenues are running billions of dollars...

The U.S. House of Representatives narrowly passed a massive overhaul of the American health care system Saturday night by a vote of 220 to 215. One Republican, Rep. Joseph Cao of Louisiana, crossed the aisle, while 39 Democrats joined the Republicans in opposing the measure. House Speaker Nancy Pelosi called passage of the bill "an historic moment for our nation and for America's families," while Republicans warned that the bill will raise taxes, increase insurance premiums and make cuts to Medicare. An enormous round of applause broke out throughout the House chamber when the crucial 218th vote was cast to...

Taxation: Policymakers piled up a $1.4 trillion deficit for fiscal 2009. The figure is so high that if Congress were to use the income tax to balance the budget, rates would have to be nearly tripled. The 2009 deficit was larger than the combined federal debt of the first two centuries of the country's existence. As staggering as that is to the mind, the 2010 deficit projects to be even bigger, roughly $1.5 trillion. The rates for joint filers earning at least $373,601 would have to be almost tripled, from 35% to 95.2%, to help close the 2010 deficit. (See...

CHICAGO (AP) - Nearly half of all U.S. children and 90 percent of black youngsters will be on food stamps at some point during childhood, and fallout from the current recession could push those numbers even higher, researchers say. The estimate comes from an analysis of 30 years of national data, and it bolsters other recent evidence on the pervasiveness of youngsters at economic risk. It suggests that almost everyone knows a family who has received food stamps, or will in the future, said lead author Mark Rank, a sociologist at Washington University in St. Louis. "Your neighbor may be...

The White House is beginning to send strong signals that it recognizes the $1.4 trillion budget deficit is a looming political problem that needs to be addressed, even as President Obama reminds Americans that the country's fiscal crisis originated with the Bush administration and will not be resolved overnight. The president's budget director, Peter R. Orszag, on Tuesday will deliver the second major speech on the deficit in a week by a top White House official. Mr. Orszag's speech on "reining in the deficit" will be the first time that a top White House economist will look forward at the...

Pelosi vs. NH: Wrecking the state budgetSaturday, Oct. 31, 2009 House Speaker Nancy Pelosi unveiled a health care reform bill that allegedly would cost the federal government less than previous House Democratic plans. But it would cost states more. The previous House bill would have made families earning up to 133 percent of the federal poverty level eligible for Medicaid, which states partially fund. New Hampshire pays 50 percent of its Medicaid costs. That would have cost states an additional $33 billion. Under Pelosi's bill, families earning up to 150 percent of the poverty level are to be covered by...

New Orleans not only faces a $68 million budget shortfall for 2010. City government is running more than $30 million in the red this year, due in large part to a sharp drop in sales tax revenue, officials said Wednesday. Earlier optimistic assessments that huge post-Katrina investments in New Orleans would insulate the city from the worst effects of a national recession have proved wrong, city economist Jerome Lomba told the city's Revenue Estimating Conference. City sales tax revenue for 2009, projected last fall to total $157 million, is now expected to fall $23 million short of that amount, in...

The unprecedented, improbable and indeed almost unimaginable global financial crisis has virtually put an end to the comfortable notion that American and Western capitalism would dominate the world economy. In turn, the financial meltdown threatening another Great Depression has been the rationale for a phenomenal expansion of government spending to prop up demand and fend off economic disaster. As a result, the deficit quadrupled from $459 billion in 2008 to $1.85 trillion this year. It has gone from 3.2% of gross domestic product to 13.1%, twice the post-World War II record of 6% in 1983 under President Reagan. What's more,...

Republican Tom Campbell, a candidate for governor who was the last state finance director to preside over a balanced budget, warned this week that California may be awash in more red ink, with revenue expected to fall short of projections by as much as $3 billion by the end of December. The alarm from Campbell, a former dean of the UC Berkeley Haas School of Business, came after state officials acknowledged two weeks ago that state revenue for the first quarter of the fiscal year, ending Sept. 30, fell $1.1 billion short of predictions. Still, as national headlines have trumpeted...

One trillion, four hundred twenty billion dollars. It’s an astounding number. It’s more than the entire economy of India and enough to give every man, woman, and child in the United States $4700. It is also our country’s federal budget deficit for 2009. That means that in the fiscal year 2009, which runs from October 1, 2008 through September 30, 2009, the federal government spent $1.42 trillion more than it took in. To put this in perspective, last year’s deficit was $459 billion – still an astounding number, but less than half the deficit for this year. When our nation...

Moody’s (NYSE:MCO) lead analyst covering US debt said that the Amercan goverment could lose its “AAA” rating if it cannot cut the deficit and budget gaps in the next three to four years. Steven Hess told Reuters: “The Aaa rating of the U.S. is not guaranteed.” The current rating should be stable for at least 18 months.It was only earlier this year that the UK government got a similar warning from credit agencies.China expressed concern to Secretary Geithner that it does not have an unending appetite for US Treasury paper. At some point the People’s Republic will not be willing to...

Daley: City Managers To Take Nearly Five Weeks Off Thousands Of City Workers To Take 24 Unpaid Days In 2010 CHICAGO (CBS) ― Faced with a $550 million budget deficit, Chicago Mayor Richard M. Daley on Monday said that all non-union city workers would take nearly five working weeks of unpaid leave next year to save the city money. Daley announced plans Monday to save $114 million by requiring 3,600 non-union city workers to take 24 unpaid days off, eliminating 220 vacant jobs and cutting expenses like travel and supplies by $20 million.

The Government Accountability Office (GAO) has released updated information on the nation’s fiscal outlook, based on the projections from the non-partisan Congressional Budget Office (CBO). On October 7, CBO announced that the nation's budget deficit for 2009 was $1.4 trillion, triple 2008's, which was the worst in history at the time.

The Obama administration on Friday said the government ran a $1.42 trillion deficit in fiscal year 2009. That made it the worst year on record since World War II, according to data from the Treasury and the White House Office of Management and Budget. Tax receipts for the year fell 16.6% overall, while spending soared 18.2% compared to fiscal year 2008. The causes: rising unemployment, the economic slowdown and the extraordinary measures taken by lawmakers to stem the economic meltdown that hit in fall 2008. Consequently, the annual deficit rose 212% to the record dollar amount of $1.42 trillion, from...

Given all the hullabaloo directed at Senator Max Baucus as he and his Democratic allies anticipated cost estimates of his healthcare bill with the nervous agitation exhibited by actors who fidget all night as they await reviews of a hopelessly bad play, Americans are now aware of the Congressional Budget Office. In fact, there was so much hullabalooing that the public has also come to know that Washington’s politicians regard the CBO as the “gold standard” when it comes to letting everyone know how much the Federal Government will take in or how deeply one of its programs will dig...

A $42.8 billion Homeland Security budget cleared the House Thursday after Democrats won a showdown vote preserving President Barack Obama’s authority to temporarily transfer Guantanamo prisoners into the United States for the purpose of prosecution. Republicans had prevailed on the same issue when framed as part of a non-binding resolution two weeks ago. But Democrats have since dug in, their lines stiffened in what became a test of loyalty to the president’s stand on Guantanamo and their own ability to break the impasse over year-end appropriations bills. --- SNIP --- New York Rep. Peter King, the ranking Republican on the...

WASHINGTON — The budget deficit for the current year will be $172 billion, according to new estimates by the Congressional Budget Office. The latest CBO figures, disclosed by a congressional aide, also predict the budget could come back into surplus by 2012, although that would require President Bush's tax cuts to expire at the end of 2010. The estimates also understate the ongoing cost of the war in Iraq, but provide a basis for majority Democrats on Capitol Hill to work to match Bush's vow to balance the federal budget in five years. The improvement in the deficit figure comes...

Three months ago, as Gov. Arnold Schwarzenegger and the Legislature enacted a much-revised state budget, this column pointed out that the state was seemingly operating on a five-month budget cycle. With recession rampant, it would take about three months for new holes to appear in a revised budget and two more months for the politicians to make still another adjustment. As if on cue, state Controller John Chiang is providing new evidence that the 2009-10 budget is leaking red ink. During the first quarter of the fiscal year, state revenues came in more than a billion dollars under the budget's...

Sacramento, Calif. (AP) -- California's state controller is warning that disappointing tax receipts will push the state into a bigger budget deficit than expected. A report released Friday by Controller John Chiang says state revenue is about $1 billion short of what lawmakers and Gov. Arnold Schwarzenegger expected when they reached a budget deal during the summer. The report says the biggest dip is in income tax, with receipts down about 11 percent.

Former Democratic Gov. Gray Davis joined Republican predecessors Pete Wilson and George Deukmejian in filing a friend-of-the-court brief Wednesday supporting Gov. Arnold Schwarzenegger's line-item vetoes of $489 million in state spending this summer. The California Chamber of Commerce, the California Taxpayers Association and the California Business Roundtable also signed the amicus brief. Schwarzenegger used his line-item veto authority to cut the funds out of the July budget revision, which he said was necessary because the Legislature failed to pass the entire deal he negotiated with legislative leaders behind closed doors. Lawmakers left the budget slightly in the red, and Schwarzenegger...

Golfers call it a "mulligan" or even more colloquially, a "mullie," but the rest of us would say it's a "do-over" when things don't go as well as hoped and we make a new stab at getting it right. Capitol politicians and various interest groups are pursuing mulligans on many of the specific provisions of the state budget that legislators ultimately adopted in July and that Gov. Arnold Schwarzenegger later signed after slashing nearly a half-billion dollars in spending. "This has been a very tough budget, probably the toughest since I have been in office here in Sacramento," the governor...

The Cato Institute today announced the launch of "Downsizing the Federal Government," a new website aimed at providing policymakers, media and the public with comprehensive data on federal spending. The federal government is running massive all-time record budget deficits, spending too much, and heading toward a financial crisis. Without a change of direction in Washington, average working families will be faced with huge tax increases and a lower standard of living. This makes the launching of this website especially timely and applicable.

UC Protest Movement Continues to Unfold By Richard Brenneman and Riya Bhattacharjee Thursday October 01, 2009 UC Berkeley students headed back to Sproul Plaza Wednesday evening to discuss possible actions to protest the university’s budget cuts and related topics. After a hugely successful student and faculty walkout Thursday, Sept. 24, which received national and international media coverage, about 200 students took part in a general assemby at 6 p.m. Wednesday, Sept. 30. The meeting had barely begun by the time the Daily Planet went to press. Student organizers said the meeting was intended as a grassroots effort to brainstorm ideas...

Gov. warns of California-style NY state budget By Daniel Massey Published: September 29, 2009 - 3:50 pm More than 100 leaders of New York state's business community gathered Tuesday morning for a meeting in Manhattan and sources say that Topic No. 1 was … the state of California. Gov. David Paterson addressed the assemblage and reported that New York's budget is not in as abysmal shape as California's, but it's headed that way if nothing is done to control state spending, according to two people who attended the event, which was sponsored by the Partnership for New York City and...

Granholm signs temporary budget bill Shutdown ends after Granholm signs interim budget Updated: Thursday, 01 Oct 2009, 12:42 PM EDT Published : Wednesday, 30 Sep 2009, 11:50 PM EDT LANSING, Mich. (WOOD) - Michigan lawmakers missed a midnight Wednesday deadline to balance the state's budget by eliminating a projected $2.8 billion deficit, opting instead for an interim one-month budget. The Legislature had been moving toward that goal without tax increases, opting instead for cuts and the use of federal stimulus money. But a full-year plan was out of reach after a standstill on the most contentious cuts. A status report:...

LANSING, Mich. (AP) -- With a midnight deadline that's come and gone, Michigan lawmakers continue to struggle to craft a spending plan, leaving many of those with a stake in how the budget turns out as uncertain as they were the day before. A deal to fill a nearly $3 billion shortfall with federal recovery dollars and more than $1 billion in cuts fell through, as many lawmakers discovered they couldn't stomach deep cuts to schools and local services such as police and fire protection in the stricken state. Michigan already is struggling with the nation's highest unemployment rate, a...

LAST week, the Senate Finance Committee voted 12-11 not to wait for the Congressional Budget Office to "score" its health-care bill before the committee votes on it. Imagine that: Some senators actually wanted to know how much the bill costs before voting on it. Let them get away with something like that, and before you know it they'll be demanding honest accounting practices -- sending the whole legislative process to hell in a hand basket. When it comes to the health-care-reform debate, you see, honest budgeting is nowhere to be seen.

The House approved a 30-day stop-gap spending bill Friday designed to keep the government operating through October and buy more time for the cash-strapped Postal Service to meet a $5.4 billion payment due next week for its retirees’ health benefits. Adopted 217-190, the measure allows the Postal Service to pay only $1.4 billion on Sept. 30 and effectively amortize the remaining $4 billion after 2017. With $32 billion in the fund, the agency insists it is still able to meet its obligations, but the issue has been handled with such a political sleight-of-hand that conservatives worry it could come back...

Sen. Jim DeMint predicted that Obamacare would be President Barack Obama's Waterloo. While that's certainly a strong possibility, Obama has other Waterloos in the wings competing for the prize, such as his monstrous deficits and his disastrous foreign policy. The Heritage Foundation reports that Obama's budget would produce $13 trillion in deficits over the next decade, even more than the outrageous $9 trillion previously projected. This is nation-shattering stuff, folks, and Obama and his minions remain unflappable, intent on staying the bankrupting course, sporting Alfred E. Neuman, "What, me worry?" expressions. The fact that we know they can't be that...

Here is a curious thing. The Environmental Protection Agency (EPA) has somehow been given authority to pay some of its employees more than we pay the vice president of the United States of America! How is it that a mere perfunctory agency can pay more to its civil service employees than we pay the second most powerful man in our government? Apparently Health and Human Services (HHS) was given special pay authority under Title 42, Section 209(f) of the U.S. Code and the EPA has glommed on to that authority to pay some scientific employees higher salaries than they could...

While 15 states require supermajority votes for tax hikes, according to the National Conference of State Legislatures, only two – California and Arkansas – also require supermajorities for budget approvals. Opponents of California's two-thirds approval requirement contend that the rules hamstring the state's ability to raise revenues in times of need, are the primary cause of new budgets being late virtually every year, and allow a relative handful of lawmakers to wield an inordinate amount of influence over the state's finances. "It is wholly unreasonable for the largest state in the union, with the eighth-largest economy in the world, to...

On Friday the Department of Corrections and Governor Quinn released the framework of an early release program the Governor claims is necessary due to the State's budgetary crisis. According to the Department of Corrections, the State will release approximately 1,000 "low level, non-violent" prisoners over the course of the next several months...

Here’s what you need to know. First, I will not sign a plan that adds one dime to our deficits – either now or in the future. Period. And to prove that I’m serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promised don’t materialize. Part of the reason I faced a trillion dollar deficit when I walked in the door of the White House is because too many initiatives over the last decade were not paid for – from the Iraq War to tax breaks...

Truth In Accounting had an incredibly important 50 state study that needs to be broadcast far and wide. It shows the mess that every state in the union is in with the budget.When the Institute for Truth in Accounting (the IFTA) began to design “The Truth about Balanced Budgets—A Fifty State Study” (the Study) in early 2008 our purpose was to widely examine the effect accounting principles and policies have on states’ budgeting and financial reporting practices. Experience in Illinois indicated to the IFTA that this state’s budgeting process used unsound accounting principles and evaded the intent of balanced budgets...

Dallas, Texas – Finally, there is a centralized location for people to search, decipher, and discuss the myriad ways federal funds are allocated every year, and even control where their tax dollars go, line by line, as they try their hand at balancing the federal budget. Launched Sept. 3, BalanceTheBudget.com is a virtual ‘town hall’ where concerned citizens and groups can share their ideas on balancing the budget, gather for news, review resources and tutorials, blog about budget solutions, and vent fiscal frustrations. Using data provided by the Congressional Budget Office, BalanceTheBudget.com maps out the U.S. budget outlays, budget deficit,...

You didn't read this in your local paper, but 2010 could be a catastrophic year for elderly heart and cancer patients. Bloomberg News reports that President Obama has proposed cutting $1.4 billion in Medicare payments to heart and cancer specialists. An Obama administration plan to cut Medicare payments to heart and cancer doctors by $1.4 billion next year is generating a backlash that’s undermining the president’s health-care overhaul. ...The proposal by Medicare, the government insurer for the elderly and disabled, is an effort by Obama to focus U.S. medicine on preventive care. ...The cuts could have the unintended consequence of...

The Café des Artistes has been doing a steady restaurant business in New York City since 1917, but is now forced to close its doors. One of the main reasons for this happens to be the fact that the Café is unfortunate enough to be a union restaurant and the exorbitant costs of supporting a union workforce has contributed to killing the business. A blog called the 212DressingRoom, a website about New York fashion, culture, art and other rather Bohemian subjects, has detailed the sad end of the long time café written by the owner of the place, Jennifer Lang....

(AP) — LANSING, Mich. - Michigan Gov. Jennifer Granholm has given state employee unions a required 30-day notice of layoffs in case a budget deal is not reached by Oct. 1. The layoff notices were sent to the unions Friday. Granholm spokeswoman Liz Boyd says the governor does not expect a government shutdown and plans to have a budget in place on time. The 30-day notice is required under collective bargaining contracts because money has not been appropriated for the fiscal year that starts Oct. 1. The Democratic governor and lawmakers so far have been unable to agree on how...

(bio) "What do people really think about health care reform? When political issues are difficult and complicated, published polls sometimes confuse rather than enlighten the debate. And health care reform is fiendishly complicated, with many different issues and many different proposals for addressing them. No wonder that the debate is generating more heat than light. This is surely one of the times when political leaders should lead rather than follow public opinion. As Winston Churchill once said, “The problem with politicians who keep their ear too close to the ground is that it is difficult to look up to them...

Don't get Davidowitz started on the economy or fundamentals. "Barack Obama's numbers have all gone mad," Davidowitz says. The Obama administration recently announced the U.S. budget deficit will be $9 trillion during the next decade; $2 trillion higher than the original forecast.

Chicago Mayor Richard Daley says the city needs to "go on a diet" to fill a more than $500-million budget deficit. But residents attending this year's first budget meeting had service increases on their minds

Tuesday’s sharply upgraded forecasts for growth in US national debt over the ext decade could hardly have come at a worse time for Barack Obama. Shortly after he was elected last November, the president let it be known he preferred the “big bang” approach to domestic reforms. As Rahm Emanuel, the White House chief of staff put it, you should “never allow a crisis to go to waste”. In other words, the financial meltdown was seen as an opportunity for Mr Obama to enact as many of his key reforms, including healthcare, within the first year of taking office.

Douglas Elmendorf, director of the Congressional Budget Office, notes that the forecasts presume no change in current tax laws...As Elmendorf dryly puts it: “Putting the nation on a sustainable fiscal course will require some combination of lower spending and higher revenues than the amounts now projected

The annual U.S. budget deficit, which has never reached $500 billion, will exceed $1.5 trillion this year and next year, the White House said Tuesday morning in its widely anticipated Mid-Session Review. The budget deficit for fiscal 2010, which begins Oct. 1, is projected to total $1.502 trillion, nearly a quarter of a trillion dollars higher than the White House forecast in May, when it released its detailed 2010 budget. In 2011, the projected deficit of $1.12 trillion would exceed $1 trillion for the third year in a row. The 2012 deficit is expected to total nearly $800 billion. The...

The following has been added to CBO's Web site (www.cbo.gov): The Budget and Economic Outlook: An Update pdf...

THE Obama administration did it again last week -- getting bad news out on a Friday evening to minimize press coverage. Within hours after President Obama left Washington for his vacation on Martha's Vineyard, the Office of Management and Budget leaked word that, sometime this week, it will revise its projection of the federal budget deficit over the next 10 years from $7 trillion to $9 trillion. That $2 trillion upward revision will put the White House's numbers in line with the $9.1 trillion deficit that the Congressional Budget Office projected in June. Back then, the administration criticized CBO's analysis;...

The Congressional Budget Office will hold a pen and pad press briefing on the summer update to the Budget and Economic Outlook on Tuesday, August 25, at 11:00 a.m. CBO Director Douglas Elmendorf will conduct the briefing. The outlook report will be available to the press and public on our website at www.cbo.gov at 10:00 a.m. the same day. Limited copies of the report will be available at the press briefing. No cameras or recording devices will be permitted in the briefing room. Only those holding valid Congressional press credentials will be admitted to the briefing. For planning purposes, please...

WASHINGTON (Reuters) - The Obama administration will raise its 10-year budget deficit projection to roughly $9 trillion from $7.108 trillion in a report next week, a senior administration official told Reuters on Friday. "The new forecasts are based on new data that reflect how severe the economic downturn was in the late fall of last year and the winter of this year," said the official, who is familiar with the plans. "Our budget projections are now in line with the spring and summer projections that the Congressional Budget Office put out." The CBO said in June that deficits between 2010...

US to hike 10-year deficit forecast to nine trillion dollars Fri Aug 21, 6:06 pm ET WASHINGTON (AFP) – US President Barack Obama's administration will raise its 10-year budget deficit forecast to about nine trillion dollars, up about two trillion from the previous forecast, a US official said Friday. The 2010-2019 projection, due out in a report expected next week, will supercede the previous forecast of about 7.1 trillion dollars, according to an official with the White House's Office of Management and Budget. The OMB official requested anonymity. The figures are expected to fuel a fierce political debate over the...

WASHINGTON (AP) -- A White House budget official says the Obama administration expects the federal deficit over the next decade to be $2 trillion bigger than previously estimated. The projection now is for a deficit of $9 trillion. The new figure reflects a worse economic picture than expected earlier this year. The official spoke on the condition of anonymity because new budget projections will not be announced until next week. Ten-year forecasts are volatile figures subject to change over time. But the higher number will likely create political difficulties ... and could create anxiety with foreign buyers of U.S. debt.