Pay As You Go, Except For A Few Trillion Here And There

Some Democrats Warn of Loophole in Obama’s Pay-As-You-Go Rules

President Obama called on Congress yesterday to enact pay-as-you-go budget rules to help tame a deficit forecast to top $1.8 trillion this year. But even as some Democrats applauded the plan, others complained that it would give a free pass to expensive policies that would sink the nation trillions of dollars deeper into the red over the next 10 years.

The proposal would bar lawmakers from expanding entitlement programs such as Medicare and Social Security, creating programs such as universal health coverage or cutting taxes unless they cover the cost by raising taxes or cutting spending elsewhere. If, by year’s end, the White House budget office determined that new initiatives had not been paid for, the president would be required to make across-the-board cuts in entitlement spending.

The proposal is similar to rules that briefly helped the Clinton administration transform big budget deficits into surpluses. Republicans let the law, known as PAYGO, lapse in 2002.

“The pay-as-you-go rule is very simple. Congress can only spend a dollar if it saves a dollar elsewhere,” Obama said at a White House ceremony, backed by more than a dozen lawmakers, including House Majority Leader Steny H. Hoyer (D-Md.), who said he would introduce the plan as legislation next week. “It is no coincidence that this rule was in place when we moved from record deficits to record surpluses in the 1990s — and that when this rule was abandoned, we returned to record deficits that doubled the national debt.”

One big difference between Obama’s proposal and the Clinton-era rules, however, is that Obama would exempt an array of expensive policies currently in effect. For example, lawmakers could extend the tax cuts enacted during the Bush administration past their 2010 expiration date, restrain the growth of the alternative-minimum tax and continue to forestall scheduled payment cuts for Medicare physicians without consequence. All told, those policies would increase annual budget deficits by more than $3.5 trillion over the next decade.

Some independent analysts who support PAYGO rules objected to the loophole. “This is like quitting drinking, but making an exception for beer and hard liquor,” said Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget.

And while the proposal found favor in the House, it faced serious obstacles in the Senate, where several key senators said they would oppose it.

“I’m not for waiving PAYGO for $3.5 trillion of items, much of which I think ought to be paid for,” said Senate Budget Committee chairman Kent Conrad (D-N.D.). “I don’t think at this point we can afford not to pay for those very large expenditures.”

Coming one day after Obama vowed to shovel money from the economic stimulus package out the door even more quickly, yesterday’s call for fiscal rectitude also drew catcalls from Republicans.

“The president continues to display a frightening ability to say one thing, yet do the exact opposite,” said Rep. Tom Price (R-Ga.). “It’s frankly insulting that a president who is on a path to bankrupting our government would try to play the role of fiscal hawk.”

Obama: It’s OK to borrow to pay for health care

President Barack Obama on Tuesday proposed budget rules that would allow Congress to borrow tens of billions of dollars and put the nation deeper in debt to jump-start the administration’s emerging health care overhaul. The “pay-as-you-go” budget formula plan is significantly weaker than a proposal Obama issued with little fanfare last month.

It would carve out about $2.5 trillion worth of exemptions for Obama’s priorities over the next decade. His health care reform plan also would get a green light to run big deficits in its early years. But over a decade, Congress would have to come up with money to cover those early year deficits.

See also:
Obama Urges Congress to Tighten ‘Paygo’ Budget Rules (Update3)
Concord Coalition Supports Statutory Paygo But Cautions Against Large Exemptions
Obama Urges Congress to Tighten ‘Paygo’ Budget Rules
Obama proposes making ‘pay-as-you-go’ the law
Obama: After $3 trillion spent … “Pay Go” is back
Pay-go makes a comeback

What manner of bull[expletive deleted is this, just how stupid does Obama think we are? Pretty damn dumb I guess, pretending to suddenly be fiscally responsible after he’s already maxed out all the national credit cards. Now that he’s wrapped the country around a tree and totaled it, he promises to drive safely from now on.

/it’s like closing the barn door after the horse, the barn, and the entire farm is gone!

Tuesday Trifecta

Today was a good day for common sense, truth, justice, and the American way.

House bonus bill is buried by the Senate

President Obama and Senate Democrats have buried a bill passed last week by the House that would have heavily taxed executive bonuses at bailed-out firms.

Despite the public outcry over $165 million in bonuses awarded at troubled insurer AIG, Senate Majority Leader Harry Reid (D-Nev.) showed little inclination Monday to bring the explosive issue to the floor this week or next. Instead, Reid is likely to delay action on executive compensation until late April, after the Senate returns from a two-week recess starting April 4.

The lack of enthusiasm to expedite the bonus legislation comes after Obama said over the weekend that he didn’t think it was a good idea for Congress to target individuals with tax proposals.

“As a general proposition, I think you certainly don’t want to use the tax code … to punish people,” Obama said in the interview with “60 Minutes” that aired Sunday.

Reacting to a frenzy of media coverage, the House last week passed a measure that would levy a 90 percent tax on bonuses received this year by executives at AIG and other companies collecting more than $5 billion in federal aid.

Senate Finance Committee Chairman Max Baucus (D-Mont.) last week introduced a less stringent proposal that would impose a 35 percent tax on bonuses. Both employers giving bonuses and executives who receive them would pay.

But even this modified proposal is being placed on the backburner.

So much for that overreaching travesty.

Specter delivers death blow to ‘card check’

Sen. Arlen Specter (R-Pa.) announced Tuesday he will oppose card check, giving an apparent death blow to the most important congressional issue to organized labor.

Specter made the dramatic announcement in a floor speech. His opposition means Democrats can count on a maximum of 59 votes to move the bill forward, one short of the 60 required to clear Senate rules.

Winning 59 votes would require Democrat Al Franken to beat Republican Norm Coleman in the still-contested Minnesota Senate race. Democrats also would have to count on holding the rest of their votes, and several centrists have raised doubts about the bill.

In his floor speech, Specter noted that Franken’s likely win could give him the 60th vote required to make the bill law.

“If so, the decisive vote would be mine,” said Specter, who told The Hill last week in an interview that his would be the decisive vote.

“It is an anguishing position but we play the cards we’re dealt,” Specter said Tuesday on the floor.

Hmm, I wonder what the Republican leadership is blackmailing Specter with to keep him on the reservation and get him to double cross his union buddies?

Democrats Take Knife To Obama’s Budget

Key Democratic leaders were performing major surgery yesterday on President Obama’s first budget plan in an effort to bring skyrocketing annual deficits under control, while preserving the option of enacting some of the president’s most significant and costly domestic priorities.

In the budget blueprints they are scheduled to formally unveil today, Democrats in the House and Senate said they plan to cut hundreds of billions of dollars from Obama’s spending request over the next five years. They also are scrapping Obama’s plan to devote more cash to the financial sector bailout. And they are restoring some of the money-saving budget gimmicks the president said he eliminated last month when he unveiled his $3.6 trillion request for the fiscal year that begins in October.

The moves come as Republicans are pounding Obama for proposing a rapid increase in government spending and taxpayers are voicing anxiety and outrage about the gargantuan sums that Washington is already pouring into the economy and banking system.

In the Senate, the result is a leaner package that would drive the annual deficit to $1.2 trillion next year, compared with $1.4 trillion under Obama’s policies. By 2014, the deficit would plummet to just over $500 billion under the Senate’s plan, requiring the nation to borrow $3.8 trillion over the next five years, compared with about $4.4 trillion under Obama’s proposal.

To meet those goals, Sen. Kent Conrad (D-N.D.), chairman of the Senate Budget Committee, said he would leave out new spending for Obama’s proposed expansion of health care coverage, a program likely to cost in excess of $1 trillion over the next 10 years, as well as the president’s proposal to make permanent an $800 tax credit for working families.

Hey, every little bit cost trimming helps and it’s encouraging to see that even the Democrats realize that Obama’s budget, as is, would create unsustainable deficits and national debt. Of course the cuts don’t go far enough but, considering the precarious political position Republicans find themselves in, it’s a good start.

See also:
Drive to Tax AIG Bonuses Slows
Is That 90% Tax On AIG Bonuses Dead?
The 90% Bonus Tax Looks Dead
Tax May Not Be Needed If Bonuses Returned, Hoyer Says
Hoyer Signals AIG Tax Bill May Have Achieved Its Purpose
Specter shifts stance to oppose card check
Specter Says He Won’t Back Unions’ ‘Card-Check’ Bill
SPECTER DEALS BLOW TO CARD CHECK
Key G.O.P. Senator Reverses Course on Union Organizing Bill
A Specter of Hope on Card Check
Senate Dems propose cutting Obama budget by billions
Conrad carves up Obama’s budget
Democrats in Congress Are Ready to Pare Budget
Deficits spook Dems, spur budget whittling
Sen. Gregg says Obama budget will bankrupt US
Gregg continues budget-blasting of Obama

So, 90% punative, retroactive, unconstitutional tax on lawful bonus payments, dead! Card check, daed! Obama’s budget . . . not dead, but seriously wounded. All in all, not bad for a day’s work if you care about the future of America.

/now it’s on to cap and trade and universal health care and let’s kill those!