Washington (CNN) – President Barack Obama sent a weekend letter to congressional leaders seeking approval for previously proposed spending measures intended to protect the nation's economic recovery, but initial response Sunday was mixed.
The Saturday letter to the leaders of the House and Senate asked for the Senate to approve an $80 billion measure offering extended jobless benefits as well as tax breaks and better access to credit for small businesses. In the letter, Obama also sought congressional support for proposals totaling about $50 billion to help state and local governments avoid layoffs and service reductions.
Obama's letter also noted that his administration was holding down some annual spending and had created a bipartisan commission intended to devise a deficit reduction strategy.
"Ultimately, reining in our deficit will take major steps, including the effective implementation of health reform and laying the conditions for the success of the bipartisan fiscal commission," Obama's letter said. "Only through this approach of aggressive and well-designed targeted and temporary actions, alongside measures to ensure a sustainable and responsible long-term budget outlook, will we be able to fulfill our economic potential."
David Axelrod, Obama's senior adviser, said Sunday that Obama's letter was intended to "underscore the urgency" of continuing to support economic recovery.
Among other things, Boehner notes that the Democratically-led Congress is yet to produce a budget more than two months after the historical deadline for doing so.
“This is a stunning failure of leadership – the kind of leadership President Obama promised to provide," Boehner says in the address.
(Read Boehner's full remarks after the jump)
New York (CNNMoney.com) - Congressional budget scorekeepers said that a grab-bag bill of spending and tax measures to be taken up this week would increase federal deficits by $134 billion over a decade.
The bill, which is likely to become a flash point in the debate over the federal debt, would raise $40 billion worth in additional revenue, according to estimates by the Congressional Budget Office and the Joint Committee on Taxation.
But that's not enough to fully offset the $174 billion in additional federal outlays that would occur as a result under the bill. CBO released its cost estimate late Friday.
New York (CNNMoney.com) - Congress is finally close to checking Wall Street reform off its to-do list. Then it will turn to a bevy of spending and tax measures. Individually, the measures may not inspire sticker shock, but together they add up.
In coming weeks, Congress will consider measures that combined could increase the deficit by close to $500 billion over 10 years. And that doesn't include the big kahuna on this year's agenda: extending the 2001 and 2003 tax cuts, which could cost anywhere from several hundred billion dollars to more than $2 trillion.
While it is expected that many measures will be paid for with revenue-generating provisions, the total cost of all that's on the table would not be fully offset. That's in large part because several measures are exempt from the new "pay-as-you-go" law.
New York (CNNMoney.com) - Reforming Social Security is still a hot-button issue. But relative to other measures needed to stabilize U.S. debt, it should be a snap.
"They could begin with Social Security, which oddly enough has gone from being the 'third rail of American politics' to the low-hanging fruit," wrote Robert Bixby, director of the Concord Coalition, a nonpartisan, grassroots deficit watchdog group.
While a Social Security fix would cure only a small part of the country's long-term fiscal shortfall, it could pay big dividends in terms of the U.S. standing internationally, deficit hawks say. "It would be a confidence builder with our foreign lenders," said Pete Peterson at a recent fiscal summit organized by his foundation, the Peter G. Peterson Foundation.
That could lessen the risk of a big rise in interest rates and buy the country more time to handle other debt-related issues, such tax and budget reform and further changes in Medicare.
A report from the Congressional Budget Office in March estimated that starting this year, Social Security will for the first time take in less revenue than it must pay out in benefits.
New York (CNNMoney.com) - They're often called the "Bush" tax cuts. But at this point they might as well be called the Bush-ama tax cuts.
That's because President Obama has embraced the tax relief measures introduced in 2001 and 2003, proposing they be extended indefinitely for most Americans. If lawmakers do nothing, the measures expire Dec. 31.
The tax cuts lowered income and investment tax rates, boosted the child credit, reduced the estate tax, and narrowed inequalities affecting married taxpayers.
Another reason for the new Bush-ama moniker: Like President Bush, President Obama has not called on Congress to pay for the cost of the tax cuts. In fact, the extension of the cuts is exempt from the new "pay-go" rules that Obama signed into law recently.
Extending the tax cuts for most Americans will increase the federal deficit by an estimated $2.2 trillion over 10 years.
Deficit hawks are uber-frustrated.
Washington (CNN) - President Barack Obama said Tuesday that "everything has to be on the table" when it comes to the issue of controlling the skyrocketing federal budget deficit. He refused, however, to say exactly which programs may be cut in the name of fiscal responsibility.
The president's remarks came as an 18-member bipartisan debt commission - the National Commission on Fiscal Responsibility and Reform - held its first meeting.
The commission is co-chaired by former Sen. Alan Simpson, R-Wyoming, and Erskine Bowles, who served as President Bill Clinton's chief of staff.
New York (CNNMoney.com) - Policymakers must put in place a credible plan to bring federal spending in line with revenue sooner rather than later to close the "unsustainable fiscal gap" that threatens the economy, Federal Reserve Chairman Ben Bernanke said Tuesday.
Bernanke delivered his message to President Obama's 18-member bipartisan debt commission, which is holding its first of many meetings that will take place over seven months.
"The path forward contains many difficult tradeoffs and choices, but postponing those choices and failing to put the nation's finances on a sustainable long-run trajectory would ultimately do great damage to our economy," Bernanke said.
Obama echoed that sentiment in comments made at the White House before the meeting began. The present fiscal situation, he noted, "will require that we put politics aside - that we think more about the next generation than the next election. There is no other way."
New York (CNNMoney.com) - The U.S. government is racking up debt at a slower pace than last year, according to Treasury Department figures released Monday.
In the first six months of the fiscal year, the U.S. government fell $717 billion further into the red, the Treasury Department reported Monday, including a $65.4 billion deficit in March. That means the deficit for fiscal 2010, which started in October, is down 8% from $781.4 billion in the same period last year.
The Treasury Department is forecasting that the deficit will hit $1.56 trillion this year, up from the record $1.4 trillion losses posted last year.
March's shortfall, the 18th consecutive monthly deficit, was down from the $191.6 billion in the red posted a year ealier. Just before the start of the financial crisis in September 2008, the government reported a monthly gain, which reduced its overall debt by $45.7 billion.
The debate over how to reduce U.S. debt levels has generated a lot of partisan huffing and puffing in Congress, but no meaningful action.
Enter President Obama's bipartisan fiscal commission, which will hold its first meeting in a few weeks.
The panel's goal is not to erase the deficit - that would be far too difficult at this point. Rather, the commission will recommend policies that can slow the growth rate of debt to a "sustainable" level. Among other things, that means making sure annual deficits don't grow faster than the economy.
The commission's first task is to figure out what lawmakers can do to bring the annual deficit as a percent of gross domestic product (GDP) down to 3% starting in 2015.
Broadly speaking, Congress has three options: raise taxes, cut spending or do both. None will be pretty.