Some Republican leaders are looking at the possibility of tying the next increase to the nation's debt limit to tax reform. While most Democrats and President Barack Obama balk at the idea, Republicans may get the support of Sen. Max Baucus (D-Mont.). Baucus has long wanted to reform the nation's bloated tax code, but, since he recently announced he will retire at the end of 2014, this may be his last shot.
"You'd better be ready to work. I'm doubling down," Baucus told a tax reform panel the day after he announced his retirement, according to National Journal.
Baucus chairs the Senate's Finance Committee, which would oversee any rewrite of the tax code. On the House side, the tax code is managed by the Ways and Means Committee, which is chaired by Rep. Dave Camp (R-Mich.), who Baucus reportedly has a close working relationship with. more >>
President Barack Obama expressed some shaky math Wednesday in a Rose Garden speech announcing his FY 2014 budget, which is now two months late. His budget replaces the sequestration cuts, but he includes the sequestration cuts in announcing how much his plan would reduce deficits.
"My budget also replaces the foolish across-the-board spending cuts that are already hurting our economy," Obama said.
Not everyone is feeling the impact of the sequester cuts, a set of automatic across-the-board spending cuts that went into effect last month as part of the Budget Control Act, Obama explained, but many families are being hurt by them. more >>
Sen. Lindsey Graham (R-S.C.) said Sunday he was encouraged that President Barack Obama will include some entitlement reforms in his budget proposal, which is expected this week. Though Obama does not go far enough, it demonstrates a willingness to compromise on a "grand bargain," Graham said on NBC's "Meet the Press."
The grand bargain would lower deficit spending two ways: first, it would reduce the long term growth of government by reforming entitlement spending; and second, it would increase government revenue without increasing tax rates by reforming the tax code.
Obama's budget proposal will include a reform to Social Security that will lower the growth rate of benefits to what is called "chained CPI," and include reforms to Medicare that will cut payments to service providers, according to White House sources. more >>
Several recent polls show President Barack Obama's approval rating going down, especially in his handling of the economy. The dip could be related to the many false warnings Obama and other administration officials made about the sequester.
Fifty percent of registered voters say they approve of the job Obama is doing, according to a March 7-10 Washington Post-ABC News poll, a five percentage point drop from the same poll in January.
When asked, "who do you trust to do a better job handling the economy – Obama or the Republicans in Congress?" the results are within the plus or minus 3.5 percentage points margin of error. Forty-four percent chose Obama and 40 percent chose the Republicans in Congress. And, when asked who do you trust to find the right balance between cutting government spending that is not needed and continuing government spending that is needed, respondents were again about evenly split. Forty-three percent said Obama and 44 percent said Republicans in Congress. more >>
President Barack Obama said the national debt, now at nearly $16.7 trillion with over $123 trillion in unfunded liabilities, is not a crisis and he will not propose to balance the budget, in an interview for ABC News.
"We don't have an immediate crisis in terms of debt. In fact, for the next 10 years, it's gonna be in a sustainable place," Obama told George Stephanopoulos in a taped interview that will air Wednesday night on ABC's "Nightline."
Obama's budget is already a month and a half late. The president is supposed to send a budget proposal to Congress by the first Monday in February, but the White House says it will not be available until April 8. more >>
With little indication that political leaders are willing to reach a compromise on government spending and taxation priorities, the Friday sequester deadline will be followed by (at least) four more budget crises created by Washington politicians.
The sequester was a set of reductions in the growth of government spending that went into effect on Friday as part of the Budget Control Act (2011). The cuts in spending growth were designed to be so painful that they would force even a deeply divided Congress and president to agree to a long term deficit reduction plan. But, they were not painful enough to encourage political leaders to engage in one of the most fundamental aspects of Democratic governance: compromise.
The failure of the sequester to enforce an adherence to Democratic norms of policymaking on the nation's political leaders bodes ill for what lies ahead. In the coming months, Congress and President Barack Obama will need to fund the government for the rest of the current fiscal year, pass funding for the next fiscal year, pass a federal budget and increase the debt limit. more >>