Federal deficit to hit $1.5T

By ANDREW TAYLOR

THE ASSOCIATED PRESS

Updated: 11:04 p.m. Wednesday, Jan. 26, 2011

Published: 9:06 a.m. Wednesday, Jan. 26, 2011

• Post a Comment 
• E-mail 
• Print 
• Share 
• Larger Type

WASHINGTON — Far from slowing, the government's deficit spending will surge to a record $1.5 trillion flood of red ink this year, congressional budget experts estimated Wednesday, blaming the slow economic recovery and last month's tax-cut law.

The report was sobering new evidence that it will take more than President Barack Obama's proposed freeze on some agencies to stem the nation's extraordinary budget woes. Republicans say they want big budget cuts but so far are light on specifics.

Wednesday's Congressional Budget Office estimates indicate the government will have to borrow 40 cents for every dollar it spends this fiscal year, which ends Sept. 30. Tax revenues are projected to drop to their lowest levels since 1950, when measured against the size of the economy.

The report, full of nasty news, also says that after decades of Social Security surpluses, the vast program's costs are no longer covered by payroll taxes.

The budget estimates will add fuel to the already-raging debate over spending and looming legislation that would allow the government to borrow more money as the national debt nears the $14.3 trillion cap set by law. Republicans controlling the House say there's no way they'll raise the limit without significant budget cuts, starting with a government funding bill that will advance next month.

Democrats and Republicans agree that stern anti-deficit steps are needed, but neither Obama nor his resurgent GOP rivals on Capitol Hill are — so far — willing to put on the table cuts to popular benefit programs such as Medicare, farm subsidies and Social Security. The need to pass legislation to fund the government and prevent a first-ever default on U.S. debt obligations seems sure to drive the two sides into negotiations.

Though the analysis predicts the economy will grow by 3.1 percent this year, it foresees unemployment remaining above 9 percent.

Dauntingly for Obama, the nonpartisan agency estimates a nationwide jobless rate of 8.2 percent on Election Day in 2012. That's higher that the rates that contributed to losses by Presidents Jimmy Carter (7.5 percent) and George H.W. Bush (7.4 percent). The nation isn't projected to be at full employment — considered to be a jobless rate of about 5 percent — until 2016.

The latest deficit figures are up from previous estimates because of bipartisan legislation passed in December that extended George W. Bush-era tax cuts and unemployment benefits for the long-term jobless and provided a 2 percentage point Social Security payroll tax cut this year.

That measure added almost $400 billion to this year's deficit, CBO says.

The deficit is on track to beat the record of $1.4 trillion set in 2009. The budget experts predict the deficit will drop to $1.1 trillion next year, still very high by historical standards.

Republicans focus on Obama's contributions to the deficit: his $821 billion economic stimulus plan, boosts for domestic programs and his signature health care overhaul. Obama points out that he inherited deficits that would have exceeded $1 trillion a year anyway.

The chilling figures came the day after Obama called for a five-year freeze on optional spending in domestic agency budgets passed by Congress each year.

Republicans were quick to blame Obama for the rising red ink. Rep. Jeb Hensarllng of Texas, chairman of the House Republican Conference, said the report "paints a picture that is more dangerous than most Americans could anticipate."

"What is our leader in the White House doing about it? Asking Congress to raise the debt ceiling, proposing new spending and sticking future generations with a multi-trillion dollar tab," Hensarling said.

Democrat Kent Conrad, chairman of the Senate Budget Committee, pointed to a problem lawmakers are sure to keep facing:

"When the American people are asked what they want done and to prioritize what they want, they want the deficits and debt dealt with. But when they are asked very specifically, will they support changes in Social Security, the polls say no. Changes in Medicare? The polls say no. Changes in defense spending? The polls say no."

"I would've liked very much if the president would have spent a bit more time helping the American people understand how really big this problem is," added Conrad, D-N.D.

Republicans are calling for deeper cuts for education, housing and the FBI — among many programs — to return them to the 2008 levels in place before Obama took office.

http://www.statesman.com/news/nation/no-stemming-red-ink-federal-deficit-to-hit-1210806.html

Bailout Foretold By Calvin & Hobbs

This was forwarded to me from a friend and is really interesting when you see it from today's perspective with bailout after bailout. Even though this cartoon was drawn over 15 years ago, as you read it, view it from the perspective from the American Auto Industry's position in the economy.

Click To Enlarge

Auto Bailout. Where are the economic advisers?

Tell me. Where are the economic advisers, the accountants, the good economists for the United States when decisions like the bailouts are being made in Congress?

If we are creating a bailout for these large auto corporations at 5% interest, how is it that we are making an investment? The reason I ask this is that we are paying out at least 5% in interest to foreign countries on the money we are borrowing for these bailouts. Doesn't the country have a good accountant/economist who can advise on a higher percentage of interest for these loans so that we can actually make money on this supposed investment?

Besides the interest issue, what about the profit being made by GM on its overseas sales? Are they really in such desperate need of the taxpayers money?

"Now GM is looking at its own international stable, and has its eye on China as a source of stopgap revenue for its North American operations. We've posted before on the fact that GM's international operations aren't doing too badly, and GM China sold 11.5 million vehicles last year -- more than any other manufacturer there. This year, it expects China sales volume to grow by 11- to 12-percent, and that means yuan in the bank." -- autoblog

So, shouldn't GM utilize its overseas profits at this time, instead of getting a handout that is composed of our future tax dollars with an interest our country is currently paying other countries for the money?

Additionally, shouldn't there be a mandatory restructuring of these enormous bureaucratic corporations in order for them to receive a dime of our money? And along with the restructuring, wouldn't it be prudent that the CEOs and other exorbitantly highly paid executives of these companies (Ford, GM, Chrysler) be taking a mandatory cut in pay, to a pay scale that actually fits standards of someone who should be accountable for the success of their company(s)?

The desire is not that additional U.S. jobs be lost. The desire is for accountability and basic accounting in general.

What do you think? Do you support this "bailout"? Or do you have a multiplicity of questions?

Martial Law. Troops deployed in the U.S.

Martial Law - Military authority imposed on a population.



U.S. Army continues their mission away from overseas. They continue to serve it here in the U.S.

A plan unfolding for decades?

What do you think? Truth or conspiracy?

Paulson Committing Terrorism? You must listen to this!

In this economy, many people are attempting to blame anyone they can to make sense of the situation. Some claim that this is the New World Order, but you need to decide that for yourself. Conspiracy? Truth? Very interesting!

U.S. Stores Closing. Economy Woes.

Watch those store money cards and gift cards.. and credit slips! Stores
that informed the Security Exchange of closing plans between October
2008 and January 2009. PLEASE PASS THIS ON TO ALL YOUR FAMILY AND
FRIENDS.


Circuit City stores... most recent (? how many)

Ann Taylor- 117 stores nationwide are to be shuttered

Lane Bryant,, Fashion Bug ,and Catherine's to close 150 store nationwide

Eddie Bauer to close stores 27 stores and more after January

Cache will close all stores

Talbots closing down all stores

J. Jill closing all stores

GAP closing 85 stores

Footlocker closing 140 stores more to close after January

Wickes Furniture closing down

Levitz closing down remaining stores

Bombay closing remaining stores

Zales closing down 82 stores and 105 after January.

Whitehall closing all stores

Piercing Pagoda closing all stores

Disney closing 98 stores and will close more after January.

Home Depot closing 15 stores 1 in NJ (New Brunswick)

Macys to close 9 stores after January

Linens and Things closing all stores

Movie Galley Closing all stores

Pacific Sunware closing stores

Pep Boys Closing 33 stores

Sprint/ Nextel closing 133 stores

JC Penney closing a number of stores after January

Ethan Allen closing down 12 stores.

Wilson Leather closing down all stores

Sharper Image closing down all stores

K B Toys closing 356 stores

Loews to close down some stores

Dillard's to close some stores.

In other words, don't buy gift cards from these stores!!!

Note: This was forwarded to my email from a friend, so I cannot vouch that it is 100% accurate.

Rethinking Obama. I've Been Too Hard On Him.

With the coming of a new week and with the opportunity to vote early, I am mulling over this election in my mind.

I'm giving Obama another thought, wondering if I am too hard on the poor lad.

Sure, the economy is bad. That is why the polls are so much higher for Obama. He has no ties to the economy, where McCain is a Republican and therefore, McCain must be responsible. When Obama gets elected, he'll fix the economy for sure.

So, I wondered about whether I've been too hard on Obama regarding the Ayers relationship. Is it his fault that the guy is literally his neighbor? I am sure that he never talks to his neighbors, since he has obviously been to busy organizing the community. He probably doesn't even know that Ayers purchased the other half of the lot, making Obama's half more affordable. I bet that, when Obama went next door for the fundraiser, he had no idea that he was stepping foot into Ayers' home. I'm guessing that he just thought he had been cut a lucky break when the guy next door offered to have a fundraiser to launch Obama's political campaign. He probably just said, 'Wow. This guy next door, whom I don't know at all, is willing to jump start my career and earn me some cash.". I bet he was totally excited and didn't even cross paths with Ayers the whole time he was there.

What about the contributions he has reportedly received (the top second) from Fannie Mae? Oh, that must have been a type-o. He is going to fix the economy, so he must have nothing to do with the down-swing of the nation's economy. He isn't a Republican. Obama is a Democrat, which means he had nothing to do with anything along the lines of the bombing economy and the lack of cash in our pocketbooks. He has tons of wonderful programs that the government is going to take charge of for us. Surely, the money for those programs will come from some magic place and we won't have to pay for it out of our earnings. His idea to have much of our society taken over by the government sounds so great. The government never screws anything up.

Obama has nothing to do with the war in Iraq. After all, he is a Democrat. Of course, he made a mistake when he initially voted for the war. The poor guy. Things just happen. It's not because of anything he has done. He wouldn't vote for anything like the war in Iraq. When Obama becomes President, his desire to yank the U.S. out of Iraq is so perfect. So what if Iraq collapses under it's own government.

I think it would be great to have dialog with Iran. When Amademajad says that the U.S. and Israel should be wiped off the map, Obama should just talk.

'So sorry that you feel that way, Amademajad. Let's talk it over and find out if this rage comes from your relationship with your father.'

When Amademajad says that the Holocaust never happened and that the Jews made it up, Obama should just discuss it. What is the problem in that? When Amademajad says that the U.S. should be bombed with a nuclear bomb, Obama should just assume that he is having a bad day, go get him a cup of coffee and talk. After all, he is human and he will feel better about things once he has been able to talk them out. Yes, Obama's desire to have diplomatic discussions with Amademajad is so realistic and reasonable.

I admire Obama's desire to be Christian. Wright must be getting the shaft when people are discussing his views. Being Christ-like is a tricky thing. Of course, Wright never taught that being Christian means that you can be racist. Why would Obama sit and listen to that council. Wright must be teaching the correct views on Christianity. Obama certainly wouldn't tie himself with anyone who taught incorrect things about 9/11. I sure do admire someone who is acting like a true Christian.

I think that I've been too hard on Obama for sure. I know who I'm going to vote for now that I have mulled it over.