Dealing With Sequestration Fallout
http://thedianerehmshow.org/shows/2013-03-04/dealing-sequestration-fallout
Assessing the economic and political damage from the tax and spending impasse: The price to be paid and who pays it.
Guests
Kevin Hassett
director of economic policy studies at the American Enterprise Institute and economic policy adviser to the Mitt Romney campaign.
Jared Bernstein
senior fellow at the Center on Budget and Policy Priorities, and former chief economist and economic policy adviser for Vice President Joe Biden.
Jim Tankersley
economic policy correspondent at The Washington Post.
Comments
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When compromise is not on the table,how can anyone negotiate..?? It just proves to me Mitt Romney was lying when he said Republicans were for closing the loop holes.
It looks like the T-Party/Republicans took the bribes from all the billionaires who paid for their election campaigns last fall.Sheldon Adelson was one,who was reported to be saving $2 billion alone if the T-Party/Republicans accepted the bribe and delivered NO TAX INCREASE on the UBER wealthy. The $100 MILLION "Citizens United" cash exchange from Adelson to Republicans (aka Free Speech),sure smells like a bribe.
My State of Ohio is placing new taxes on the poor,to give another tax cut for the wealthy...
"Small Government" is truly sickening here.. "Small Government" is like diamonds. Only the wealthy can afford them.Only the wealthy get the benefits.
Is cutting the size and cost of government good or bad? For nearly 4 years we`ve been told continually,it`s the #1 issue facing our country today.. AUSTERITY or SEQUESTOR.. whatever the name is about cutting government.. It is the demand of Conservative Republicans,very LOUDLY.. However,they call the European cuts of Austerity a liberal plan. In the U.S. Republicans say the cuts the Sequester is bringing down on us is Obama`s creation...So what do Conservative Republicans stand for,other than protecting the UBER FILTHY rich campaign donor?
One Republican says cuts are no biggie,while another called the cuts concerning.
What bothers me most is so many people and even so called journalists, don`t know the difference between a bill and a savings account.
Lets be sure we have the correct figures from the Congressional Budget Office (CBO) before we talk about "devastating" "massive" "harsh"cuts.
Discretionary Spending
2013 discretionary spending AFTER Sequester $1.213 Trillion
2008 discretionary spending.$1.134 Trillion. Note that this was the last free spending "fat"year before the great recession as well as a year in which we were engaged in two wars.
That's about a 7 per cent increase in a period of extremely low inflation when many families and businesses have not had any increase at all. Isn't the talk of devastation by President Obama and his cabinet overblown?
Lets remember that Secretary of Education Arne Duncan has already been caught in a "Four Pinocchio" fib in the Washington Post when he claimed that teachers were already being laid off due to the sequestration and that Secretary of Transportation Ray LaHood has made numerous claims about the "cuts" even though his department will actually spend MORE in 2013 than they did in 2012.
Total US Government Spending
2008 $2.925 Trillion
2012 $3.538 Trillion
2013 $3.553 Trillion after sequestration (slightly MORE than 2012 and 21 per cent MORE than 2008)
I know that the Paul Krugman and his followers are railing against "austerity" but their definition of austerity is a spending increase of 21 per cent financed by borrowing about 40 cents of every dollar that we spend. If this is austerity, what is the definition of irresponsible borrowing and spending ?
I credit President Obama when he says that various loopholes should be eliminated for deficit reduction, but does this have to be part of these "cuts"?
2 totally different questions:
1) Can one governmental department voluntarily give money to another governmental department?
Example: National parks voluntarily gives money to air traffic controllers.
2) If Congress can't handle the power of the purse (missing deadline after deadline to decide a budget), how about if the consequence is simply that they lose that power, and for one (1) budget cycle, the decision is made by another body?
That body could be the 50 governors, or it could be the voters or taxpayers through their IRS forms, or just about any other entity. Any third-party arbitration group, even.
After yelling at top of vocal capacity, “don’t worry about silly 2008 crash, don’t worry about bailing auto industry, don’t worry that every GOP admin between 1960 and ’08 increased debt to GDP (while every Dem admin decreased it), don’t worry that W increased the debt very nearly as much as all previous administrations put together (a claim they somehow tried to pin on Obama?), WE“VE GOTTA CUT SPENDING”.
“SPENDING, SPENDING, SPENDING” cuts will cure all ills.
In House, "sequester" (Budget Control Act )passed with 218 Republicans votes- No Dems voted for it.
Now we are forced to enact those cuts and, GOP are saying, “who me?- we don’t want that stinkin’ sequester".
“Obama’s idea, Obama’s idea- any pain inflicted to economy or individuals is his fault.”
PLEASE!
Will the day ever come when GOP chooses to elect adults??
Can lobbyists influence sequestration cuts?
Basically, congressional Republicans don't want any tax raises (regardless of tax hikes agreed upon during the fiscal cliff deal). By failing to reach a compromise with Democrats, it appears that they have achieved their goal without any kind of compromise, so long as lobbyists can influence what gets cut.
An article about the AIPAC lobbying to exclude Israel from sequestration blowback seems to suggest this, and further suggests that this may have been the congressional Republican goal all along.
Article is here: http://www.councilforthenationalinterest.org/news/israellobby/item/2487-...
So, I am trying to understand whether or not lobbyists can sway what gets cut. If so, this seems wildly problematic, and has (to my knowledge) not made it into public discourse on the sequester.
Thoughts?
What about healthcare? The President has fought hard for the Affordable Care Act and its provisions to overhaul healthcare, bringing in millions of uninsured and providing healthcare security to our country. But with the across-the-board cuts reaching down into healthcare funding - from research dollars to the 2% Medicare cuts - no one is safe. And America's seniors, the sickest among us, may end up taking the brunt of these cuts. Exactly how is sequestration going to affect Medicare and other health programs? And how is the ACA going to come out standing on the other side after such a big hit to the industry?
Many economically focused outlets like the WSJ admit corporate profits and CEO compensation are soaring without any meaningful job creation. More "productivity" (profit margin) all the time suits the (less than) 1%. But they are telling their ideologically disconnected "conservatives" in Congress never to increase taxes on their windfall, onshore or off. (And they have the bribe money and no work jobs to back it up.) What I really wonder is how T-party Libertarians equate this highway robbery with the hard fought living my dentist Jim works his fingers to the bone to get. What I suspect is that selfish right wingers equate the bribes and no work jobs, and the superfortunes of the billionares, to the "free market." After all, if they're obedient to the rich they get it for free, and they're definitely in the corruption futures market. Same time, business liberals are selling us out with Wall Street protectionism and global trade agreements that negate human rights. Congress and the war powered executive are a chipper spitting us out as mulch. The problem is that everyday voters are cut off from any influence in federal government, state government (especially with ALEC and other corrupt lobbyers) and even local government (run by real estate cabals). And if we let even a peep, here comes national security! We are like Greece already, because the rich refuse to pay their share, and the police are still getting paid to bust heads. Fascism is now perfected! Big bidness and government enforce and collect one another's taxation and keep the pot of sadistic violence boiling through media. Sequestration ain't nothing but a baloney sandwich, and we the meat.
I'd trust bernie milm to bank my checks and pay my bills on time, but anything more than that would seem to be beyond his comprehension. I am myself of two minds. I could let go of government because it is failing to serve urgent human needs that cannot be met any other way I know, but I do understand that federal regulations are all that stand between us and business carnage in our households and in our common environment. The dilemma is that government has been captured by wealth and is assuming an extraction and crowd control role in behalf of bidness interests. So I wish for the day our taxes could be used to enable the downtrodden and protect us from crooks.
Now my second mind says we should turn our backs on both big business and government and Occupy them to death. But then our population is dependent as chickens waiting on chicken feed (and I include the servants of the wealthy) and has no access to self-sufficiency by material means or training. We are domesticated chickens never thinking outside the pen. We do need to cut back on wasting energy and food and the environment, but our chicken brains don't have the capacity to imagine anything new or different on their own.
If bernie had that capacity he might understand that sadism and neglect are political choices, that money is conditional, based on social contract, and that corporate charters are castles in the air. The USA can make all the money imaginable at negligible cost, and could balance the budget with a platinum coin or an apple strudel. All us bernies believe the slave masters that chicken feed is in short supply, and they run the chicken feed factory. Better start scratchin' for worms bernie, it's gonna be a long Fascism for us chickens.
You short sighted libs should be jumping for joy, there are no spending cuts just a tiny fraction of future spending growth has been trimmed. You now have the opportunity to blame all of Obama's malfeasance on the economy at the feet of the republicans for an impossible to find spending cut.
FoW:
Right you are. Before sequestration, his bad economic policies were Bush's fault. Now they will be sequestration's (GOP) fault.
No responsibility, no solutions, no leadership.
What about healthcare? The President has fought hard for the Affordable Care Act and its provisions to overhaul healthcare, bringing in millions of uninsured and providing healthcare security to our country. But with the across-the-board cuts reaching down into healthcare funding - from research dollars to the 2% Medicare cuts - no one is safe. And America's seniors, the sickest among us, may end up taking the brunt of these cuts. Exactly how is sequestration going to affect Medicare and other health programs? And how is the ACA going to come out standing on the other side after such a big hit to the industry?
What about Beefsteak Rye? I heard the Beefsteak Rye recipe has been sold, how will these deep federal government spending cuts impact my ability to get a fresh loaf?
The President saying "I am willing to make cuts to entitlements" is like the alcoholic saying "I am willing to quit drinking" while they are still drinking. Until the alcoholic does something about it they are still an alcoholic. Until the President ACTUALLY specifies what cuts are there, they are just words. We did just get more taxes by some deductions being eliminated. Preseident got his more revenue thing. Time to pull up his big boy pants and make some cuts.
How do you tell a politician is lying? THeir lips are moving!
I am always struck how these discussions seem to seldom compare our (the United States) approach to that of other countries and trading blocs. Is it a lack of knowledge or just our culture of the us, a world on to it's own? At this point, our politicians, business leaders and citizens should be digging hard for solutions that do exist overseas. Germany has an unemployment rate of 5%. Look at the Netherlands, Korea...etc. They have a fundamentally different approach to government. Thir cultures also did not turn there backs to manufacturing and vocational skills. The problem we are in has been a long time in the making and it is one that all of us are responsible for. When your "Defence" or War budget is near 9 times your education budget and there is little resistance to change, you know it is a CULTURAL PROBLEM.
Diane,
I have never been so disgusted with our Congress as I am today. Their cavalier attitudes towards the country's citizens for the benefit of staying entrenched in their ideologies is deplorable. Is there anyway to recall all the members?!! I will listen to the show to see if I can better understand what's going on. But to have to go through these budget battles every 3 months is not good government, not good leadership, and sends the message - "let the country be damned."
Here's an idea: The Catholics lock the Cardinals in a room until they elect a new Pope. How about we lock Congress in a room and they can't come out (no food, water or outside communication) until they reach a deal.
Cuts in military spending was supposed to be the "bitter pill" for Republicans. Now that across the board cuts have taken affect, what's to prevent Republicans from pushing increases in Military spending, thus getting what they wanted.
The budget deficit is not the problem. Our problem is the jobs deficit. See http://www.forbes.com/sites/johntharvey/2013/02/26/suicide-by-sequestrat... for clarity on this issue.
Lorenzoni wrote: . "Is it a lack of knowledge or just our culture of the ME"
"When your "Defence" or War budget is near 9 times your education budget"
The U.S. is the clear leader in total annual spending, but ranks 9th in Science performance and 10th in Math.
U.S. Education Spending and Performance vs. The World
http://rossieronline.usc.edu/u-s-education-versus-the-world-infographic/
While he's given far more in cuts than his opponents have given, the President has been succinct about what he wants. More revenues are prudent. He has public opinion on his side, he has economists on his side, he has history on his side. Maybe it's time for a week-long national debate to put the spotlight fully on the intractable individuals he has to work with. History will, for sure.
Dear Diane,
It seems misleading to use the term "revenues" inappropriately. Many Republicans argue for lower tax RATES, which they argue wil stimulate the economy in the long term, which will increase tax REVENUE in the future. Whether we agree with Republicans or not, you could say Republicans want larger tax revenues. Just like the Democrats, who try to increase tax revenues through higher tax rates.
Many problems in Washington seem to stem from a simple sloppy definition of economic terms.
We continue to hear about the need to cut entitlements that affect the poor and the less well off.
Couldn't the so call tax "loop holes" that benefit the more well off and wealthiest be considered entitlements that these people have grown accustomed and are unwilling to give up.
Shouldn't everyone we weaned off of their entitlements.
Diane says she's baffled. There is no reason to be baffled. The explanation is crystal clear. The Tea Party won't let the Republicans do anything about the sequestration that now is in effect -- they won. Plus, nobody directly impacted by the sequestration is important politically. No voter prefers to bailout workers who aren't working regardless of the reason, no voter cares about civilian workers at DOD, and no voter sees children who aren't fed or educated. Let's move on to the important issue of jobs.
More spending is necessary. It won't happen. Republicans will continue to dictate the conversation about the deficit, even though the deficit is a long-term problem that can be resolved easily by Obama if Republicans were reasonable..
tell those elected officials to throw out the stupid bill and pass a bill that removes all thier pay, benefits, and makes it illegal for them to receive gifts and donations until they fix the budget.
The question is ... Are we 9th in science and 10th in math because we are doing bad or is it they are doing good? Sometimes if we do really good but others do better it is not that we are bad. And what countries are they? Compare the 1-8 in science with other areas and I imagine we are better than they are on average. Other countries target math to be good a math but are bad at language or culture. Overall USA wins.
JSawyer wrote: "While he's given far more in cuts than his opponents have given, the President has been succinct about what he wants"
What ?
Fiscal Cliff Deal: $1 in Spending Cuts for Every $41 in Tax Increases
According to the Congressional Budget Office, the last-minute fiscal cliff deal reached by congressional leaders and President Barack Obama cuts only $15 billion in spending while increasing tax revenues by $620 billion—a 41:1 ratio of tax increases to spending cuts.
http://www.infowars.com/fiscal-cliff-deal-1-in-spending-cuts-for-every-4...
Thank you for your discussion today. But you have an elephant in the room, which is unmentioned, namely, the place of political contributions and the corrupting influence brought by the current and future interactions between congress and lobbyists, the so-called "revolving door". We used to use the words "graft" and "corruption" in describing politicians who are controlled by such influences. It underscores the importance of cleaning up political campaign finances so politicians are responsive to all their constituents, and not just the big funders, seeking relief from regulation of the way they do their business. The big funders clearly do not care that "relief" from regulation has brought us into the mess that we are in since 2007. Solve this and then maybe congress will return to solving the grievous problems America faces.
I would like to make a suggestion:
How about the government open a site for crowdfunding for government programs? Then people can vote with their dollars to make up the shortfall for the programs they feel are important. The government can keep statistics on the numbers of people contributing as well as the total amount contributed to generate quality data on what the population really cares about funding.
When compromise is not on the table,how can anyone negotiate..?? It just proves to me Mitt Romney was lying when he said Republicans were for closing the loop holes.
Romney wanted to undo loop-holes instead of tax hikes. President Obama got 2 tax increases with Obama Care and the tax changes in January. If anyone thinks that these changes have not hurt small businesses, you don't own a small business.
By wanting to eliminate tax loop-holes, he is wanting his cake and to eat it too.
By the way, has anyone spent as much tax money on vacations as the President and his wife (and Tiger Woods) over the past two months while those we all struggle?