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January 23, 2010
White House, Democratic Lawmakers Cut Deal on Deficit Commission
White House, Democratic lawmakers cut deal on deficit commission
Faced with growing alarm over the nation's soaring debt, the White House and congressional Democrats tentatively agreed Tuesday to create an independent budget commission and to put its recommendations for fiscal solvency to a vote in Congress by the end of this year.
Under the agreement, President Obama would issue an executive order to create an 18-member panel that would be granted broad authority to propose changes in the tax code and in the massive federal entitlement programs -- including Medicare, Medicaid and Social Security -- that threaten to drive the nation's debt to levels not seen since World War II.
The accord comes a week before Obama is scheduled to deliver his first State of the Union address to a nation increasingly concerned about his stewardship of the economy and the federal budget. After a year in which he advocated spending hundreds of billions of dollars on a huge economic stimulus package and a far-reaching overhaul of the health-care system, Obama has pledged to redouble his effort to rein in record budget deficits even as he has come under withering Republican attack.
The commission would deliver its recommendations after this fall's congressional elections, postponing potentially painful decisions about the nation's fiscal future until after Democrats face the voters. But if the commission approves a deficit-reduction plan, Congress would have to act on it quickly under the agreement, forged late Tuesday in a meeting with Vice President Biden, White House budget director Peter R. Orszag, and Democratic lawmakers led by Senate Majority Leader Harry M. Reid (Nev.), House Speaker Nancy Pelosi (D-Calif.) and House Majority Leader Steny H. Hoyer (Md.).
Government spending to bail out the troubled financial sector and to stimulate economic activity have combined with sagging tax collections to push last year's budget deficit to a record $1.4 trillion. The budget gap is projected to be just as large this year and to hover close to $1 trillion a year for much of the next decade.
Deficit spending, in turn, has caused the nation's accumulated debt to swell to dangerous levels. Last month, Congress voted to increase the legal debt limit to $12.4 trillion, a record figure that the Treasury expects to exceed early this year. The deal on the budget commission clears the way for Congress to approve an even larger increase in the legal limit on borrowing, to well over $13 trillion, a figure that Democrats hope will see the Treasury through the rest of 2010.
The Senate is expected to open debate Wednesday on the debt limit.
Republican commission advocates remain skeptical that a presidentially appointed panel would have the clout to tackle the nation's toughest fiscal problems. Sen. Judd Gregg (R-N.H.), a sponsor with Conrad of legislation to create a budget commission by law, called a presidentially appointed panel "a fraud" designed to do little more than give Democrats political cover.
"It's a fraud among anyone interested in fiscal responsibility to claim an executive order could structure something that would actually lead to action," Gregg said.
Some Democrats, particularly in the House, where leaders have long resisted relinquishing their authority over taxes and spending, are also less than optimistic. Under the agreement, the commission would have 18 members, including six lawmakers appointed by congressional Democrats and six lawmakers appointed by congressional Republicans. Obama would appoint six others, only four of whom could be Democrats.
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Wild Thing's comment.......
Place locks on the front doors of Congress. Problem solved!
Panel this Obama! You pompous twit. Can one get any dumber than this guy? He knows why because he helped accelerate and create it.
So typical of Hussein Obama...so far this is his governing style, create panels, hold summits, talk, talk, talk...and then do nothing. No tangible results. Try and convince the people you are doing something when really, you are doing nothing but playing golf.
.... Thank you Jim for sending this to me.
Posted by Wild Thing at January 23, 2010 04:45 AM
Comments
Congress does not have a vault of money waiting to be distributed. Every dollar Congress injects into the economy must first be taxed or borrowed(in obama's case TAKEN) out of the economy. No new spending power is created. It is merely redistributed from one group of people to another.
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Yes, government spending can put under-utilized factories and individuals to work–but only by idling other resources in whatever part of the economy supplied the funds. If adding $1 billion would create 40,000 jobs in one depressed part of the economy, then losing $1 billion will cost roughly the same number of jobs in whatever part of the economy supplied Washington with the funds. It is a zero-sum transfer regardless of whether the unemployment rate is 5 percent or 50 percent.
Now you have 40,000 people on unemployment collecting a fraction of their pay. The employers are now short 1 Billion dollars, which could have been used to create new jobs and new wealth. The loss of those 40,000 jobs isn't just those people who gave up the tax money, other sections of the economy are affected too. 40,000 customers are now out of work and their consumption drops significantly, hence more layoffs.
The Marxist philosophy destroys economies and societies, and takes them down to a level that ultimately destroys the people. It has a snowball effect on the whole economy. The bureaucracies created by the Socialists only help accelerate the downfall of a free society.
Posted by: Mark at January 23, 2010 08:49 AM
Czar Dr. Zhicago and his Baracksheviks will do like Uncle Josef 'Steel' Stalin did later - Surround the red states and starve them, da comrades? COLLECTIVEI$M in DC CCCP?
Posted by: darthcrUSAderworldtour07 at January 23, 2010 09:42 AM
Oh Boy! Another commission. Pretty soon most Americans will be government employees( we are in the sense that we pay taxes). obama loves big govt. We really ought to be cutting the size of govt.
Posted by: TomR at January 23, 2010 12:45 PM
Mark, thank you, I agree, taken is the way we
should refer to it now with Obama.
Darth, DITTO that.
Tom, it is something how they love commissions. I agree too, Reagan said it better then I could about big government, and he too was so right.
Posted by: Wild Thing at January 24, 2010 01:42 AM
