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A few well-written words can convey a wealth of information, particularly when there is no lag time between when they are written and when they are read. The IPS blog gives you an opportunity to hear directly from IPS scholars and staff on ideas large and small and for us to hear back from you.



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Entries tagged "budget"

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Anti-American Budget Cuts

July 11, 2013 ·

Families across the country recently celebrated the Fourth of July like they always do: with annual beach trips, barbecues, baseball games, and fireworks. But one of my favorite local traditions was canceled, courtesy of Congress.

Every year on the Fourth, without fail, my family and I would take a trip to Sagamore Hill. Affectionately nicknamed the "Summer White House," Sagamore Hill was President Teddy Roosevelt's home on Long Island. Today, it's a National Historic Site operated by the National Park Service.

Josh Rothman/FlickrFor me, Sagamore Hill was a magical place that came to life on the Fourth of July. Rough Riders rode their horses. TR look-a-likes strolled across the grounds. Nature trails demanded to be explored. And the great mansion begged visitors to see its curious antiquities.

Not this year. Due to the sequester, this national treasure was forced to reduce its annual budget by $76,000. Independence Day was canceled in 2013.

You know things are bad when the Summer White House can't afford to stay open on the Fourth of July.

But Sagamore Hill's event wasn't the only one canceled. All across the country, communities went without their July Fourth fireworks, traditions, and festivals. Bands were silent. Skies were empty.

Yes, the sequester has had worse effects: School budgets, environmental initiatives, and health services across the nation have been cut. People are losing their jobs. Some children have lost their Head Start slots. Some seniors aren't getting the meals-on-wheels they used to.

But the cancelation of smaller programs also demands outrage. They may be taken for granted, but they're the kind of services that build communities.

Colleen Teubner is a student at the George Washington University and an OtherWords intern at the Institute for Policy Studies. OtherWords.org

New Economy Transformation: Obama Budget Won't Help

February 16, 2012 ·

Two military policeman go through training at Fort Bragg, NC. Photo by Spc. Garett HernandezThe last decade’s surge in military spending has pushed military contracting deeper into the foundations of our economy. Reversing this process, and transferring the savings to support the green economy, are necessary components of the project to build the new economic foundation we need.

Here is a quick take on how little the President’s budget request, released this week, is going to help.

First a few bright spots. This budget is a milestone of sorts. For the first time, it offers less money to the military next year than we are spending this year. This is not the way the term “spending cut” tends to be defined in Washington-speak. Mostly “cuts” are made to last year’s expansive projections of the future. As in: the doubling of my salary that I projected last year didn’t happen, therefore I took a salary cut. All those military spending cuts referred to in previous years have been that kind.

With respect to support for the green economy, the budget does call for increases in spending on specific clean energy programs over what Congress appropriated last year.

Pull back just a little to see a slightly bigger picture, and things don’t look so good.

First, that military spending cut? It’s real (for the first time) but it’s about 1% of the Pentagon’s total. Not exactly transformational. The administration thought about eliminating one of our three nuclear weapon delivery systems (bombers, submarines, and land-based missiles); they thought about killing the most expensive weapon system of all time, the F35; they thought about having 10 rather than 11 aircraft carriers (no other country has even one to challenge them). They did none of these things.

And after next year the military budget will, according to plan, go back up. We will spend more in real terms over the next ten years than we spent during the previous ten. This after 13 straight years of increases. This while we spend more than the next 17 countries put together.

The Obama administration did invest about $80 billion in the green economy through the Recovery Act. But that money is mostly gone now. While their budget does make targeted investments—like $310 million for solar and $95 million for wind—overall spending on clean technology in this budget has almost been cut in half. The climate change budget includes, in addition to funding from the Energy Department, EPA money for pollution control, Treasury Department loan guarantees for clean tech investment, GSA purchases of fuel-efficient vehicles, and Housing and Urban Development funds for building weatherization. Those programs totaled $27.6 billion in the 2012 budget. In 2013 their allotment is $15 billion.

Of course, to the extent Republicans are in charge, this will be much worse. They want to increase military spending far beyond what the Obama administration has in mind. And they’re hoping that the trillion-dollar “sequestration” currently planned for 2013 will be allowed to fall on everything but the Pentagon budget.

Neither plan, needless to say, is transformational. For that, we have America Is Not Broke.

Since the Super Committee Failed, Now The Rest Of Us Can Succeed

November 21, 2011 ·

Thank you to Super-Committee Republicans who remained intransigent in their insistence of governing by and for the 1%, protecting their self-interest and the interests of the Super-Rich and Wall Street Bankers.

The Super Committee was a short-lived political show. IPS has prescriptions for real budget solutions. Photo by DonkeyHotey.

Thank you to the Super-Committee Democrats who, though they revealed their  willingness, if reluctant, to do  the same by putting drastic cuts to vital domestic  and earned benefits programs on the table next to revenue-raisers, stood up against a bad deal.  The Democrats on the Super-Committee were responsive to the 99% in the end.

The undemocratic, appointed Joint Select committee of six Democrats and six Republicans, a.k.a. the “Super-Committee,” failed to reach an agreement that would have unnecessarily imposed untold hardship on the vast majority of those of us already struggling in a bad economy.  If this inability to reach a terrible deal is “failure”, can you imagine what “success,” defined by this crowd would have looked like?

Here’s what success for America’s short- and long-term fiscal health should look like; and thanks to the Super-Committee fail, we might just have the time and political space to achieve some of it:

My colleagues at the Institute for Policy Studies  have a newly released Report: America Is Not Broke: How to Fix the Crisis While Making the Country More Equitable, Green, and Secure.

The report asserts that the current economic crisis presents us all with the opportunity and challenge to use our nation’s vast wealth to create a sustainable economy which functions well for all of us.

The Institute for Policy Studies comes up with seven times the total $1.2 trillion over ten years savings that the Super-Committee was charged with finding.  Not only would this be success in correcting national priorities and positively affecting the long-term debt, these tax and spending reforms would create a society that works for 99% of us.

If we had the political will to actually achieve success, we could achieve at least $824 billion per year by doing the following:

1)      Generate revenue equitably: Going beyond rolling back the Bush tax cuts for the wealthy. The report proposes reforms would generate $375 billion per year. These proposals ensure that Wall Street and the wealthy pay their fair share and  also call for a small tax on trades of stocks, bonds, and derivatives as a way to both generate revenue and discourage high-risk, high-frequency trading.

2)      Ensure that security spending actually makes our country more secure: A total of $252 billion per year could be raised from smart reductions in the military budget by reducing the enormous number of overseas U.S. military bases; eliminating obsolete and wasteful defense programs; ending the war in Afghanistan as we end the war in Iraq

3)      Create a clean, sustainable environment: Eliminating corporate welfare for the oil industry and taxing could generate nearly $200 billion per year in revenue, while creating incentives to adopt green technologies and reduce our nation's dependence on foreign oil.

 Finally, though not outlined in the report and admittedly more difficult to achieve, its important to note we need true health care reform so that escalating health costs do not overtake even the most responsible debt-reduction steps.  The Center on Economic Policy Research reports that with the current health system, CBO projections show devastating consequences for our budget deficits going forward. But, for instance, if we had universal access to health care and the same per person costs as Canada, we would save $1.2 trillion a year, with $600 of the savings going to the government.

Taken together, this formula for success would put us squarely and strongly on the path to both fiscal sustainability and toward a more equitable and flourishing society.

If the Super-Committee Fails, America Wins

November 18, 2011 ·

The deal passed this summer in order to get Republican support for the necessary raising of our national debt ceiling was a bad deal. The creation of the 12-member bi-partisan “Super-Committee” charged with enacting that deal’s mandate of removing $1.2 trillion from our national debt over the next ten years was a bad idea. And, any agreement which might emerge from this bad idea born of a bad deal is destined to be a bad agreement.  The cuts resulting from the trigger to be pulled in the absence of a Super-Committee agreement is the best of bad options for the American people.

We all stand to lose if the Super-Committee reaches a deal. Photo by sunlightfoundation.

Called a “sequestration,” this process would protect earned benefits such as Social Security, Medicare, Medicaid, thus protecting the vast majority of Americans who rely on them.  Further, the Pentagon budget, which has doubled in the past ten years, would see a small reduction which would bring it back to 2007 funding level. Draconian and painful cuts in the order of a devastating $600 Billion to already slashed and strained social programs would begin to be enacted, but not until 2013. All of the sequestration-required cuts could potentially be refigured and re-legislated, and at a later time when the economy may have rebounded enough to better stand the ravage.

Both the Democratic and Republican proposals to the Super-Committee contain not only drastic cuts to crucial anti-poverty entitlement programs, they also lower taxes on the super-rich, or raise too little to matter much. These cuts would begin to go into effect immediately upon passage at a time when our economy is far too weak to do anything but spiral downward in the face of such austerity measures.

It is increasingly looking as though there will, mercifully, be no Super-Committee deal. This is not failure. This is hope for the American people, for our suffering and shrinking middle class, for our unemployed suffering the ravages of poverty, for 99% of us. The failure of the Super-Committee is a victory for the American people.

Lawmakers, and the public, need to understand this. Democrats on the Super-Committee need to understand this. Super-Committee Democrat John Kerry of Massachusetts needs to see the error and danger of his alarmist proclamation that the markets will react badly to the absence of a deal from the SuperCommittee. As John Irons of The Economic Policy Institute explains:

Does the market believe that Democrats and Republicans will come together in a Kumbaya moment to pass $3 trillion in tax increases and/or cuts to spending? I wouldn’t bet on it. Goldman Sachs noted in a recent Q&A on the supercommittee that, “a ‘grand bargain’ to resolve this imbalance appears to be a low probability this year. Instead, the politically realistic outcomes range from no agreement to a deal reaching $1.2 trillion in deficit reduction over 10 years.” They also note that just “32% of economists polled in the November Blue Chip financial survey expected a super committee agreement to become law.” Thus a failure would merely confirm market expectations, and there should be little reaction in the markets.

We will see backpedaling on both sides. We will see the Republicans trying to “lockbox” defense spending. We will hear cries that the sky is falling for all kinds of reasons.  Don’t listen. Stand firm.

Undertand: No Deal is better than a Bad Deal; and a Bad Deal is all we would get from the Super-Committee.

Republican Pettiness and Democratic Enabling Lead to Budget that Hurts New Jerseyans

July 6, 2011 ·

New Jersey Senate President Stephen Sweeney’s recent dustup with Republican Governor Chris Christie should be a warning to Washington Democrats as they enter the final stages of debt negotiations with conservative Republicans.

The story began when Sweeney, as he said, “stuck his neck out” to support legislation that forced the state’s 500,000 union workers to pay a much larger share of their health and pension benefits. New Jersey’s unions protested the bill and pushed for negotiations with the governor. Christie rejected this offer and forged ahead with one massive bill that will place a huge financial burden on New Jersey’s public workers. Besides shifting more costs to workers, the bill also raises the retirement age and freezes cost of living adjustments. Christie claimed the legislation would save the Garden State three hundred million dollars but other state officials have pegged the savings as low as ten million dollars. Nevertheless, Democrat Stephen Sweeney, in his role as Senate President, assisted the Republicans in moving the bill through the New Jersey Senate. Sweeney did so believing the governor would support certain programs in the budget that Democrats valued.

Governor Chris Christie used the line-item veto to make a painful impact on people's lives and play petty politics. Creative Commons caricature by DonkeyHotey

Sweeney was livid at the cuts. He felt jilted by Christie and out of frustration went on a verbal tirade against the vacationing Christie calling him a “punk”, “Mr. Potter” and professing his desire to punch the governor in the head. Christie, who made his name using idiot bravado of his own, expressed sadness with Sweeney’s choice of words. However, the genuine sadness lies not with bickering, pathetic politicians but with the millions of New Jerseyans who will be affected by Christie’s cuts and Sweeney’s enabling behavior. They include the impaired children whose New Jersey center will cut back programs and resources because of the cuts. Not to mention that New Jersey’s colleges and universities will be raising tuition on students because of the governor’s draconian budget. Sweeney could have prevented these cuts if he hadn’t been swept up the faux Christie mania that’s been manufactured by members of the elite media who applaud him for his bullying and unbalanced approach to governing. The people of New Jersey, polls have shown, disapprove of Christies job performance. But Sweeney, instead of standing in solidarity with New Jersey’s public employees, joined Christie in shoving the cost shifting down their throats. What did he get in return for turning his back on the unions? Millions upon millions in cuts to programs that help those who need help the most during this period of economic malaise.

Washington Democrats should take note from what transpired in New Jersey. Where they should be fighting to protect federal programs and expenditures that assist the middle-class, working-class and poor, they are instead, as the New York Times disclosed this week, pondering deep cuts to Medicaid and Social Security with the hope that such cuts will bring Republicans on board. They will not. Once the conservatives in Congress get President Obama and his Democratic party to capitulate on this issue they will push for even deeper cuts, all along never ceding an inch on future tax increases which have to be part of any proposal to reduce the deficit.

No one denies the fact that these are tough and turbulent times. And no one wishes to halt the economy’s growth however anemic it may be. But most Americans also don’t want to see millions of their fellow citizens asked to sacrifice what they cannot afford, while the economic elites are left unfazed. Tough choices will have to be made but the burden of these tough choices should not fall on the backs of our most vulnerable citizens. It’s not logical. It’s not moral. And it’s not just.

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