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Bankrupting America’s Spending Daily

Posted: February 12, 2013 at 2:15 pm   /   by

Spending Daily | February 12, 2013

President To Make Case Against Spending Cuts In State Of The Union
The Hill reports, “President Obama will use his State of the Union speech Tuesday to turn public opinion against automatic spending cuts and argue that some of the money to replace the cuts should instead come from higher taxes. He will use the prime-time TV address to argue the economy would be damaged if $85 billion in automatic spending cuts were to go ahead on schedule on March 1, and will seek to set up Republicans to take the blame if they do.  Obama will spend a significant portion of his address talking about jobs and the economy, according to White House aides, who say the president will strike a similartone as he has in recent days in calling for a ‘balanced’ package of spending cuts and tax hikes to replace the sequester.  Senate Democrats aim to introduce a sequester replacement bill by Thursday that will include tax hikes and spending cuts. Republicans in Congress say they are willing to replace the sequester, but only with new spending cuts.”

Pentagon Prepares For Budget Cuts
The Wall Street Journal reports, “With a growing sense of resignation, Pentagon officials are preparing for billions of dollars in spending reductions, holding out little hope that President Barack Obama and Republican lawmakers will be able to avert deep cuts set to take hold on March 1. As time runs out for adeal, the Navy has made plans to scale back deployments that could affect rapid response to crises, the Air Force is preparing to curb flying hours for pilots, and the Army is planning to curtail training. ‘There is very-little-to-no optimism in the Pentagon that there is going to be a solution,’ said one top defense official. ‘The service chiefs are planning for the worst.’ Departing Defense Secretary Leon Panetta and Pentagon leaders have begun detailing the impact of the automatic spending reductions—known as sequestration—that are slated to cut $1.2 trillion from the federal budget in the next decade. That would translate to more than $46 billion in military cuts—about 9% of the defense budget—in the next seven months. ‘This is not a game,’ Mr. Panetta said in a speech last week at Georgetown University. ‘This is a reality.’”

“Army, Navy Running Over Budget”
POLITICO reports, “Army and Navy operations spending for the first half of this fiscal year is running above the rate set by Congress — a budget decision approved by the White House but one that could make the remaining months that much harder without some relief from lawmakers. An administration official confirmed to POLITICO on Monday that the two services — as well as the Marines to a much lesser degree — have been allowed to exceed their daily rate set under the continuing resolution that has governed government wide appropriations since Oct. 1. All three services will face serious shortfalls if Congress decides to simply extend the CR through Sept. 30, the end of the fiscal year. And the fact that the military has spent more in the first half of the year only adds to the squeeze. The CR sets an annualized rate for spending that is then apportioned by the White House budget office according to the length of the resolution — in this case 178 days or 48.77 percent of a full year.”

Fed’s Holding Of US Debt Up 257% Under Obama
CNS News reports, “In data released Thursday afternoon, the Federal Reserve revealed that its holdings of U.S. government debt had increased to an all-time record of $1,696,691,000,000 as of the close of business on Wednesday. The Fed’s holdings of U.S. government debt have increased by 257 percent since President Barack Obama was first inaugurated on Jan. 20, 2009, and the Fed is currently the single largest holder of U.S. government debt. … Since Obama has been president, the publicly held portion of the U.S. government debt (as opposed to the “intragovernmental” deb the government has borrowed from federal trust funds such as the Social Security Trust Fund) has increased by $5,264,245,866,257.40. The $1.221369 in additional U.S. government debt the Fed has purchased during Obama’s presidency equals 23 percent of all the new publicly held debt the Treasury has issued during that time.”

State Of The Union Preview: Obama To Focus On Economy, Social Reforms
The Wall Street Journal reports, “President Barack Obama is expected to prod Congress to take steps to spur the economy, in a State of the Union addressthat is also set to include immigration, gun control, climate change and education as key themes. His speech Tuesday before a joint session of Congress—scheduled to begin at 9 p.m.—comes as unemployment remains stubbornly high and as deep divides in Washington over government spending, debts and deficits threaten to pull the fragile economy back into a recession. The speech is seen as a continuation of his second inaugural address, in which the president, fresh off of a convincing re-election win, pushed a series of social policies favored mostly by Democrats and laid out an economic vision that includes trying to overhaul the tax code, rebuild the nation’s infrastructure and revive American manufacturing.”

GOP Response To Call Agenda ‘Big Government’
The Associated Press reports, “Republicans intend to cast President Barack Obama’s second-term agenda as more ‘big government’ and offer a series of steps to boost economic growth and reduce the federal debt, countering the president’s agenda with competing visions for the country. Florida Sen. Marco Rubio, previewing the Republican response to Obama’s State of the Union address onTuesday, said Republican leaders would pursue policies that would create jobs for middle-class families, tame the federal debt and hold down future spending while providing a check on the president’s agenda. ‘We don’t just want to be the opposition. We want to be the alternative,’ Rubio said in an interview with The Associated Press.”

Lew Likely To Face Tough Fiscal Challenges Ahead As Treasurer
The Associated Press reports, “The to-do list that awaits Jacob Lew, President Barack Obama’s choice to be Treasury secretary, is daunting. Bridge disputes in Congress on taxes and spending. Shrink budget deficits. Manage tense economic ties with China. Press Europe to reduce debts while fighting a recession. Defend the U.S. financial overhaul law. Prevent a global currency war. And those are just the obviouschallenges. … The federal budget is sure to preoccupy Lew’s early weeks, and it’s also likely to dominate his confirmation hearing before the Senate Finance Committee. Republicans are expected to use the hearing to stress their differences with the administration over deficits and taxes. Sen. Orrin Hatch of Utah, the panel’s top Republican, said he would press Lew on ‘what kind of plan the Obama administration has to confront our skyrocketing debt and ourbroken entitlement programs.’ Lew, 57, will likely be well-prepared to spar over taxes and spending. He has twice served as a White House budget director – once during the Clinton administration and once under Obama before becomingWhite House chief of staff.”

Lobbyists Urge President To Call For More Regulation In Speech
The Hill reports, “A coalition of groups backing strengthened federalregulations is looking for President Obama to speak forcefully in Tuesday’s State of the Union address about the need for public safeguards – and his intention to use presidential power to obtain them. Obama has signaled a willingness to accomplish through executive authority those elements of his policy agenda that the divided Congress will not approve. He is widely expected tooutline additional steps that his administration can take during the speech. ‘We’re expecting there are some things that the executive branch can do,’ said Katherine McFate, co-chair of the Coalition for Sensible Safeguards.  The group is made up of several organizations pushing for tougher rules in an array of areas, ranging from the environment to Wall Street.”

Fed’s Yellen: ‘Aggressive Easing’ Needed To Boast Job Growth
The Washington Post reports, “The Federal Reserve’s aggressive easing of monetary policy is warranted given the still-battered state of the U.S. labor market, Fed Vice Chairman Janet L. Yellen said Monday. In an address to thepolitically influential AFL-CIO, Yellen bemoaned the unusually weak nature of the economic expansion. ‘The gulf between maximum employment and the very difficult conditions workers face today helps explain the urgency behind the Federal Reserve’s ongoing efforts to strengthen the recovery,’ Yellen told the largest U.S. labor group. ‘We have taken, and are continuing to take, forceful action to increase the pace of economic growth and job creation.’ … Some analysts worry that the Fed’s stimulus policies will spark future inflation, but the central bank maintains that it can remove liquidity from the financial system when needed.” is an educational project of Public Notice, an independent, nonpartisan, non-profit, 501(c)(4) organization dedicated to providing facts and insight on the effects public policy has on Americans’ financial well-being.

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Bankrupting America's Spending Daily