Budget News Dec. 13 - 17

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News
FRIDAY
Senate Democrats give up bid to pass $1.1 trillion spending bill
In a dramatic twist played out on the floor of the Senate, Majority Leader Harry Reid conceded Thursday night he lacked the votes to bring up a $1.1 trillion spending bill designed to fund the federal government for the rest of the current fiscal year.
TARP cost will be a 'fraction' of original price tag
Geithner told the Congressional Oversight Panel that the cost of TARP, the Troubled Asset Relief Program, will be no more than the amount spent on the program's housing initiatives.

THURSDAY
Medicaid Budget Challenges Continue To Plague States, Threaten Safety Net
States across the country continue to face challenges related to their Medicaid budgets and their abilities to provide care to a growing population of poor and disabled people.
Congress faces imminent deadline to pass a spending plan
With time running out on the government's authority to spend money, the Senate is expected to vote this week on a $1.1 trillion bill that would settle the issue for the rest of the fiscal year.

WEDNESDAY
Democrats' budget bill: $1.1 trillion; 1,900 pages
Included is an $840 million increase for Head Start and $550 million for Obama’s signature Race to the Top education initiative.
Reid threatens to keep Congress into next year
New spending bill totals $575.13 million per page.
Federal spending clash looms
Once again, Congress is facing intense deadline pressure to pass a spending bill to fund the federal government.
Omnibus Looks Strong in Senate
Congress is facing some pressure: The current stopgap measure expires Dec. 18.

TUESDAY
INFOGRAPHIC: Is Obama a Secret Tax Cutter?
President Obama's net spending increase totals to $1.1 trillion, while his net tax cuts total to $505.2 billion.

Economist Comments
FRIDAY
Closer Fiscal Union: A Collective Guarantee
Debt restructuring could be one part of the longer-term resolution of the crisis, together with a move toward deeper European integration to harness the region's collective strength.
Euro Defaults Need to Be Carried Out Quickly: Elena Carletti
Far from being irrational, markets are quite right this time to be concerned about the current crisis in the euro area.

THURSDAY
Examiner Editorial: Lame-duck Dems jam spending bill with 6,600 earmarks
The 2,000-page omnibus bill contains 6,600 earmarks worth $8.3 billion, including funds for such national priorities as termite research...
The 111th Congress's Final Insult
Bluto Blutarsky must have been an Appropriator.

WEDNESDAY
Public-Sector Pains Put Strain on Recovery
It turns out government really is part of the problem.
BILLINGSLEY: Education payouts lack payoff
Canada has no federal education ministry or department and no federal Cabinet official for K-12 education. At the federal level, Canada spends virtually nothing on K-12 education and on a per-student basis, spends about 20 percent less than the United States. Yet Canada is outperforming the United States.
States Slow to Face New Fiscal Reality
...yet now, with only about $40 billion in stimulus money still in their bank accounts, states face as much as another $100 billion in deficits next year.
RIEDL: Deficit commission wants too much tax, too little reform
Measured against a current-policy base line (which assumes todays tax rates and spending policies continue), the report proposed $3.3 trillion in tax increases, $3.5 trillion in spending reductions and $1.3 trillion in net interest savings through 2020. This would leave the highest federal tax burden in American history (21 percent of the economy), and still not balance the budget until 2035.

TUESDAY
How to Control State Spending
Balanced-budget rules work better than tax-and-expenditure limitations.
The Municipal Debt Bubble
As cities and states boost their debts by 800 percent, a housing-like crisis looms.
The US Treasury Debt Trap
Interest paid on national debt for the fiscal year 2010, which ended in September, was $414 billion or about 20% of tax revenues. That interest was against debt that was averaging about $13 trillion.

Blogs
FRIDAY
New Ways And Means Chair: Spending Cuts, Not Tax Increases
He said he's for making the tax code simpler, something he and President Obama can agree on.
The Averting-Disaster Syndrome
While defaults are not good news for a country, it is important to remember that they are the symptom and not the disease itself. Sometimes default, rather than systematic bailouts, can be the opportunity for a country to get in better shape. It’s not painless, but there isn’t another way.

THURSDAY
Secondary Sources: National Debt, EU Crisis, Broadway Economics
The Congressional Budget Office looks at the cost of servicing the national debt.
McCain Details Omnibus Pork on Senate Floor
According to the Constitution, the public's money should be spent only on those things that benefit everyone (i.e., the "general welfare," a clause that has sadly been repeatedly ignored or conveniently misinterpreted), and should not be taken from taxpayers for the purpose of giving it to particular groups or narrow interests.

WEDNESDAY
Bailouts or Bankruptcy for State and Local Government Pension Problems?
Congress should provide a mechanism to make the process more direct, giving the states the flexibility to address their fiscal problems consistent with federalism and the principles of limited constitutional government.

TUESDAY
Visualizing the U.S. National Debt: 1791-2010
It's time to update our U.S. national debt history visualization project, bringing it fully up to date through Fiscal Year 2010.
Setting a Regulatory Budget
Congress is far too prone to pass legislation forcing private companies to pay for something that would never be undertaken if the voter had to pay for it. But the voter does pay for it--indirectly, through lower growth and lost opportunities.
Tim Pawlenty on Public-Sector Unions
Giving public employees control of their own savings is essential for any kind of fair relationship between governments, their employees, and the taxpayers. An accurate accounting system is crucial to any fiscally responsible discussion.

MONDAY
Encouraging Polling Data on Spending Restraint vs. Deficit Reduction
By a 57-34 margin, they say that reducing federal spending should be the number-one goal of fiscal policy rather than deficit reduction. And since red ink is just a symptom of the real problem of too much spending, this data is very encouraging.
Remember the deficit-shrinking plans?
Three budget proposals all found ways to shrink the deficit. Where did they find common ground?

Reports
TUESDAY
Getting an Accurate Picture of State Pension Liabilities
Recognizing the unsustainable future of current public pension plans, many state legislatures are considering pension reform. Unfortunately, most proposed reforms are insufficient to fill the funding gap because government accounting standards continue to underestimate the true debt.
The Political Advantage of Restraining Spending
A number of studies over the past 20 years seem to suggest that, all things being equal, there is no systematic relationship between spending cuts and adverse political outcomes. In fact, the opposite may be true: there may instead be a political advantage to restraining spending.