Playing The Sequester Blame Game: Drama Obama Not Problem Solver But Blame Shifter–Republicans Are Not Problem Solvers But Blame Shifters–Shut Off The Blame Shifters–Lead, Follow, or Get Out of The Way–Balance The Budget In Four Years By Real Cuts of $250 Billion Each Year To Budget Baseline for Four Years For Total of $1,000 Billion or You Are Out–Tea Party Patriots Proclamation–Videos

Posted on February 20, 2013. Filed under: Banking, Blogroll, Books, Communications, Economics, Employment, Federal Government, Federal Government Budget, Fiscal Policy, government, government spending, History of Economic Thought, Inflation, Law, liberty, Life, media, Monetary Policy, Money, People, Philosophy, Politics, Public Sector, Rants, Raves, Unemployment, Unions, Video, War, Wealth, Wisdom | Tags: Balanced Budgets, Barack Obama, Blame Game, Blame Shifters, Bob Woodward, Budget Baseline, Flip Flopper, FY 2013 Budget, Jobs, Liar, Massive Deficits, Obama's Big Lie, Rand Paul, Sequester, Spending Addiction Disorder, Tea Party Patriots, The Sequester |

Obama PROMISES To Cut Deficit In Half By 2012

Live Obama speech on debt 23th february 2009

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Obama’s big lie and massive deficits: spending addiction disorder (SAD)

By Raymond Thomas Pronk

Crisis and fear mongering as well as blame shifting are again running rampant among the ruling political elites in Washington over out-of-control government spending and what to do about it.

President Barack Obama and progressive Congressional Democrats want to increase federal government spending by increasing taxes through closing so-called “tax loopholes” or more precisely eliminating existing tax deductions and credits in the Internal Revenue code.

House Speaker John Boehner and conservative Congressional Republicans want to decrease government spending and decrease tax rates by also eliminating “tax loopholes.” There is no middle ground to negotiate given the diametrically opposed positions of the political parties. This was not always the case.

Early in his first term Obama delivered a speech in the White House titled “A New Era of Responsibility,” captured on the YouTube video titled “Obama will cut deficit in half FEB 2009.”  He said, “We cannot, and will not, sustain deficits like these without end. Contrary to the prevailing wisdom in Washington these past few years, we cannot simply spend as we please and defer the consequences to the next budget, the next administration, or the next generation.

“We are paying the price for these deficits right now. In 2008 alone, we paid $250 billion in interest on our debt — one in every 10 taxpayer dollars. That is more than three times what we spent on education that year; more than seven times what we spent on VA health care.

“So if we confront this crisis without also confronting the deficits that helped cause it, we risk sinking into another crisis down the road as our interest payments rise, our obligations come due, confidence in our economy erodes, and our children and our grandchildren are unable to pursue their dreams because they’re saddled with our debts.

“And that’s why today I’m pledging to cut the deficit we inherited in half by the end of my first term in office. This will not be easy. It will require us to make difficult decisions and face challenges we’ve long neglected. But I refuse to leave our children with a debt that they cannot repay — and that means taking responsibility right now, in this administration, for getting our spending under control.”

The last George W. Bush deficit for fiscal year 2008 was nearly $459 billion. If Obama was serious about meeting his pledge of cutting the deficit in half by the end of his first term, the deficit should have been less than $230 billion for fiscal year 2012. Obama did the exact opposite of what he promised the American people he would do in February 2009. Instead of cutting the deficit in half, he doubled the deficit to more than a trillion dollars for each fiscal year he has been in office as the table below clearly shows:

Summary of Spending Outlays, Tax Receipts, Deficits (-) or Surpluses, 2005-2013        (in millions of dollars)
Fiscal Year	Spending Outlays	Tax Receipts	-Deficit +Surplus	President (Party)	House Control	Senate Control
2005	2,471,957	2,153,611	-318,346	Bush (R)	Republicans	Democrats
2006	2,655,050	2,406,859	-248,181	Bush (R)	Republicans	Democrats
2007	2,728,686	2,567,985	-150,701	Bush (R)	Democrats	Democrats
2008	2,982,544	2,523,991	-458,553	Bush (R)	Democrats	Democrats
2009	3,517,677	2,104,989	-1,412,588	Obama (D)	Democrats	Democrats
2010	3,456,213	2,162,724	-1,293,489	Obama (D)	Democrats	Democrats
2011	3,603,061	2,303,466	-1,299,595	Obama (D)	Republicans	Democrats
2012	3,538,286	2,449,093	-1,089,193	Obama (D)	Republicans	Democrats
2013 est.	3,803,364	2,901,956	-901,408	Obama (D)	Republicans	Democrats
Source: The Budget for Fiscal Year 2013, Historical Tables, Table 1.1http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/hist.pdf

These massive and unprecedented deficits required that the national debt be increased to pay for the government’s out-of-control spending and for Congress to increase the debt ceiling to $16.4 trillion. On Aug. 2, 2011 President Obama signed into law The Budget Control Act of 2011. This ended the so-called debt ceiling crisis by increasing the debt-level immediately by $400 billion and allowing Obama to ask for another increase of the ceiling by $500 billion with Congressional approval in the future. The law established the Congressional Joint Select Committee on Debt Reduction, better known as the “super committee,” with the task of reducing the deficit by $1.5 trillion by Dec. 23, 2011. The super committee failed to accomplish its assigned task.

This triggered the sequestration provisions in the law requiring across-the-board cuts in government spending of $1.2 trillion over 10 years with a corresponding increase in the debt-level by $1.2 trillion. Both Democrats and Republicans voted for the sequestration when they passed the law. However, the original idea for sequestration came from White House congressional relations chief Rob Nabors and Jack Lew, who was then budget director, whom with Obama’s approval presented the idea to Democratic Senate Majority Leader Harry Reid, according to Bob Woodward as documented in his book “The Price of Politics.“

On Jan. 31, Congress suspended the borrowing limit or debt ceiling of $16.4 trillion for three months until May 19.

By March 1 Congress needed to cut $1.2 trillion from the growth in the Congressional Budget Office baseline for fiscal years 2013 through 2021 or the sequestration would be triggered. These automatic spending cuts had to come from both discretionary and mandatory spending.

Under the sequestration order for fiscal year 2013, signed by Obama on Mar. 1, there needs to be a $85.3 billion cut in growth in federal government budget authority of which $42.7 billion is defense, $28.7 billion non-defense discretionary, $9.9 billion Medicare and $4 billion other mandatory.

For fiscal year 2013 the total federal government spending outlays are estimated to be about $3.8 trillion with estimated total tax revenues of about $2.9 trillion resulting in a deficit of about $901 billion. The sequestration impact for fiscal year 2013 is an estimated $44 billion cut in spending outlays or about 1.4% of total federal government spending.

The crisis and fear mongering and blame shifting is never-ending as Congress must now agree to a fiscal year 2013 continuing resolution by March 31. Meanwhile the U.S. economy is on the verge of another recession with higher unemployment rates and many more millions of unemployed Americans.

The absence of leadership in Washington to budget to estimated tax receipts and by so doing live within the means of the American people is the core problem. The solution would require the repeal of Congress’s baseline budgeting process whereby current spending levels are used to determine future funding requirements by adding increased funding for population growth, inflation and other factors to the current level of spending. The congressional budget baseline process totally ignores estimated tax receipts or revenues as a budgetary constraint. The result is massive unsustainable deficits.

Obama’s new era of responsibility was pure propaganda prevarication. Obama’s age of fiscal insanity and spending addiction disorder continues to destroy jobs, wreck the economy and kill the American dream. Neither progressive Democrats nor Republicans have the will, courage, integrity, wisdom and vision to balance the federal budget. Truly unbelievable.

http://federalbudget.com/

http://www.usgovernmentspending.com/debt_deficit_history

Historical Debt Outstanding – Annual 2000 – 2012

Includes legal tender notes, gold and silver certificates, etc.

The first fiscal year for the U.S. Government started Jan. 1, 1789.  Congress changed the beginning of the fiscal year from Jan. 1 to Jul. 1 in 1842, and finally from Jul. 1 to Oct. 1 in 1977 where it remains today.

To find more historical information, visit The Public Debt Historical Information  archives.

Date	Dollar Amount
09/30/2012	16,066,241,407,385.89
09/30/2011	14,790,340,328,557.15
09/30/2010	13,561,623,030,891.79
09/30/2009	11,909,829,003,511.75
09/30/2008	10,024,724,896,912.49
09/30/2007	9,007,653,372,262.48
09/30/2006	8,506,973,899,215.23
09/30/2005	7,932,709,661,723.50
09/30/2004	7,379,052,696,330.32
09/30/2003	6,783,231,062,743.62
09/30/2002	6,228,235,965,597.16
09/30/2001	5,807,463,412,200.06
09/30/2000	5,674,178,209,886.86

 http://www.treasurydirect.gov/govt/reports/pd/histdebt/histdebt_histo5.htm

The Debt to the Penny and Who Holds It

U.S. Debt Clock

http://www.usdebtclock.org/

Budget Control Act Sequestration Would Hit Defense Hardest

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Bob Woodward on ‘The Price of Politics,’ Fiscal Fight

In summer 2011, a partisan Congress sparred with the White House on how to solve the U.S. debt crisis. Judy Woodruff talks to journalist Bob Woodward about his new book, “The Price of Politics,” about how Washington’s politicians couldn’t look past their own political aspirations in order to forge a deal.

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John Boehner: The President Is Raging Against a Budget Crisis He Created

Obama invented the ‘sequester’ in the summer of 2011 to avoid facing up to America’s spending problem.

By JOHN BOEHNER

A week from now, a dramatic new federal policy is set to go into effect that threatens U.S. national security, thousands of jobs and more. In a bit of irony, President Obama stood Tuesday with first responders who could lose their jobs if the policy goes into effect. Most Americans are just hearing about this Washington creation for the first time: the sequester. What they might not realize from Mr. Obama’s statements is that it is a product of the president’s own failed leadership.

The sequester is a wave of deep spending cuts scheduled to hit on March 1. Unless Congress acts, $85 billion in across-the-board cuts will occur this year, with another $1.1 trillion coming over the next decade. There is nothing wrong with cutting spending that much—we should be cutting even more—but the sequester is an ugly and dangerous way to do it.

By law, the sequester focuses on the narrow portion of the budget that funds the operating accounts for federal agencies and departments, including the Department of Defense. Exempt is most entitlement spending—the large portion of the budget that is driving the nation’s looming debt crisis. Should the sequester take effect, America’s military budget would be slashed nearly half a trillion dollars over the next 10 years. Border security, law enforcement, aviation safety and many other programs would all have diminished resources.

How did the country find itself in this mess?

During the summer of 2011, as Washington worked toward a plan to reduce the deficit to allow for an increase in the federal debt limit, President Obama and I very nearly came to a historic agreement. Unfortunately our deal fell apart at the last minute when the president demanded an extra $400 billion in new tax revenue—50% more than we had shaken hands on just days before.

It was a disappointing decision by the president, but with just days until a breach of the debt limit, a solution was still required—and fast. I immediately got together with Senate leaders Harry Reid and Mitch McConnell to forge a bipartisan congressional plan. It would be called the Budget Control Act.

The plan called for immediate caps on discretionary spending (to save $917 billion) and the creation of a special House-Senate “super committee” to find an additional $1.2 trillion in savings. The deal also included a simple but powerful mechanism to ensure that the committee met its deficit-reduction target: If it didn’t, the debt limit would not be increased again in a few months.

But President Obama was determined not to face another debt-limit increase before his re-election campaign. Having just blown up one deal, the president scuttled this bipartisan, bicameral agreement. His solution? A sequester.

With the debt limit set to be hit in a matter of hours, Republicans and Democrats in Congress reluctantly accepted the president’s demand for the sequester, and a revised version of the Budget Control Act was passed on a bipartisan basis.

Ultimately, the super committee failed to find an agreement, despite Republicans offering a balanced mix of spending cuts and new revenue through tax reform. As a result, the president’s sequester is now imminent.

Both parties today have a responsibility to find a bipartisan solution to the sequester. Turning it off and erasing its deficit reduction isn’t an option. What Congress should do is replace it with other spending cuts that put America on the path to a balanced budget in 10 years, without threatening national security.

Having first proposed and demanded the sequester, it would make sense that the president lead the effort to replace it. Unfortunately, he has put forth no detailed plan that can pass Congress, and the Senate—controlled by his Democratic allies—hasn’t even voted on a solution, let alone passed one. By contrast, House Republicans have twice passed plans to replace the sequester with common-sense cuts and reforms that protect national security.

The president has repeatedly called for even more tax revenue, but the American people don’t support trading spending cuts for higher taxes. They understand that the tax debate is now closed.

The president got his higher taxes—$600 billion from higher earners, with no spending cuts—at the end of 2012. He also got higher taxes via ObamaCare. Meanwhile, no one should be talking about raising taxes when the government is still paying people to play videogames, giving folks free cellphones, and buying $47,000 cigarette-smoking machines.

Washington must get serious about its spending problem. If it can’t reform America’s safety net and retirement-security programs, they will no longer be there for those who rely on them. Republicans’ willingness to do what is necessary to save these programs is well-known. But after four years, we haven’t seen the same type of courage from the president.

The president’s sequester is the wrong way to reduce the deficit, but it is here to stay until Washington Democrats get serious about cutting spending. The government simply cannot keep delaying the inevitable and spending money it doesn’t have.

So, as the president’s outrage about the sequester grows in coming days, Republicans have a simple response: Mr. President, we agree that your sequester is bad policy. What spending are you willing to cut to replace it?

— Mr. Boehner, a Republican congressman from Ohio, is speaker of the House.

A version of this article appeared February 20, 2013, on page A15 in the U.S. edition of The Wall Street Journal, with the headline: The President Is Raging Against a Budget Crisis He Created.

http://online.wsj.com/article/SB10001424127887323495104578314240032274944.html

2013 United States federal budget

The 2013 United States federal budget is the budget to fund government operations for the fiscal year 2013, which is October 2012–September 2013. The original spending request was issued by President Barack Obama in February 2012.^[1] The actual appropriations for fiscal year 2013 must be authorized by the full Congress before the budget can take effect, in accordance with the United States budget process.

The Budget Control Act of 2011 mandates caps on discretionary spending, which under current law will be lowered beginning in January 2013 to remove $1.2 trillion of spending over the following ten years. In addition, several temporary tax cuts are scheduled to expire at the beginning of the 2013 calendar year, including the 2001 and 2003 Bush tax cuts on income, capital gains, and estate tax, which had been extended in a 2010 tax deal, as well as a payroll tax cut that began as a result of the 2010 deal and had been most recently extended in an early 2012 tax deal. The combination of sudden spending cuts and tax increases has led to concerns about significant negative effects on the economy in the wake of the weak recovery from the late 2000s recession.

History

Budget Control Act and the Deficit Reduction Committee

The Budget Control Act of 2011 was passed in August 2011 as a resolution to the debt-ceiling crisis. The fiscal year (FY) 2013 budget is the first to be affected by the second of two rounds of budget cuts specified in the act. (The first round of cuts has already been applied to the ten years beginning in FY2012.) For this second round of cuts, the Budget Control Act had formed the United States Congress Joint Select Committee on Deficit Reduction, sometimes referred to as the “supercommittee”, to identify at least $1.2 trillion in cuts over the ten years beginning with FY2013, and specified automatic across-the-board cuts of the same amount, equally split between security and non-security programs, if no such budget reduction legislation was passed by Congress.^[4]

On November 21, 2011, the Joint Select Committee on Deficit Reduction announced that it did not reach a deal on the budget-cutting legislation, raising the possibility that the automatic cuts would be activated if the full Congress could not enact its own deficit reduction legislation by December 23, 2011. The supercommittee’s lack of an agreement was attributed to the refusal of Republicans to consider any tax increases, combined with Democratic insistence on including these revenue increases such as the expiration of the Bush tax cuts, which under current law expire at the end of 2012.^[5]

Initial proposals

President Obama’s February 2012 budget message to Congress addressed themes of economic crisis and response, an updated defense strategy, taxation fairness, income equality, fiscal responsibility, and investments in education and research to help the U.S. compete economically. He wrote: “The way to rebuild our economy and strengthen the middle class is to make sure that everyone in America gets a fair shot at success. Instead of lowering our standards and our sights, we need to win a race to the top for good jobs that pay well and offer security for the middle class. To succeed and thrive in the global, high-tech economy, we need America to be a place with the highest-skilled, highest-educated workers; the most advanced transportation and communication networks; and the strongest commitment to research and technology in the world. This Budget makes investments that can help America win this race, create good jobs, and lead in the world economy.”^[6]

Key elements of the President’s budget for fiscal year (FY) 2013 included expiration of a variety of tax cuts for couples earning over $250,000 ($200,000 if single), short-term stimulus measures to support job growth, and targeted tax cuts for families and businesses. The budget included 2013 revenues of $2.9 trillion or 17.8% GDP (up from $2.5 trillion or 15.8% GDP in 2012) and spending of $3.8 trillion or 23.3% GDP (similar to the prior year in dollar terms but below the 24.3% GDP in 2012). The projected 2013 deficit was $900 billion (5.5% GDP), down from the 2012 deficit of $1.3 trillion (8.5% GDP).^[7]

Over the 2013-2022 period, the budget essentially freezes defense and non-defense discretionary spending in dollar terms, such that these categories shrink relative to a growing economy, from 8.7% GDP to 5.9% GDP. Mandatory spending (e.g., Medicare, Medicaid, Social Security, and other safety net programs) remain around 14% GDP. Net interest rises from 1.5% GDP to 3.3% GDP. Revenues rise steadily during the period from 17.8% GDP to 20.1% GDP, averaging 19.2% GDP.^[8] Debt held by the public rises from $12.6 trillion to $18.7 trillion, but remains flat around 77% GDP during the period.^[9]

On May 16, 2012, the United States Senate voted on a 52-page Republican budget amendment billed as a summary of the nearly 2,000 pages in the Obama administration’s 2013 budget proposal. The amendment was defeated by a unanimous 99–0 vote, which paralleled the House of Representatives having voted a similar rejection in March by a count of 414–0. Those defeats of the Republicans’ amendments marked the second year in a row such summary bills met unanimous opposition.^[10] In explaining their votes against, Congressional Democrats disputed whether the Republican summary accurately represented the Obama budget proposal; by contrast, Congressional Republicans claimed that their amendment included ample data taken directly from said budget.^[11]

Legislation begins to be passed

On July 31, 2012, a tentative deal was announced to fund the government from October 2012 through March 2013 through a continuing resolution, with spending rates slightly higher than the FY2012 levels. The deal was reached because Republicans were eager to avoid a prolonged dispute that could threaten a government shutdown just before the upcoming 2012 general elections.^[12] The bill, the Continuing Appropriations Resolution, 2013, was passed in the House 329–91,^[13] passed in the Senate 62–30,^[14] and signed by President Obama on September 28, 2012.^[15]

On August 1, 2012, the House and Senate passed competing bills on the extension of the Bush tax cuts. The House bill would extend all the tax cuts for one year, while the Senate version would allow taxes to rise on incomes over $250,000. The passage of the bills was reported as being intended as political cover; progress on tax legislation was not expected until after the November elections.^[16]

In late December, the Republican House leadership proposed legislation that would allow tax cuts to rise relative to 2012 levels only for annual income over $1,000,000. The proposal was known as “Plan B”, and was intended to force the Senate and the Obama administration to pass it and delay further negotiations until the following month, when Republicans were expected to use the reaching of the federal debt limit as leverage. However, the House vote on the plan was abruptly cancelled on December 20, 2012 after it became clear that the bill did not have enough support to pass, due to conservative members of the House who would not support any legislation that would raise taxes without also cutting spending.^[17]

On December 28, 2012, the Senate passed the Disaster Relief Appropriations Act, 2013 to provide for $60.4 billion in additional spending to cover recovery costs from Hurricane Sandy, which had hit the northeastern United States in late October. The bill passed the Senate 62–32, but faced uncertain prospects in the House.^[18]

At around 2 a.m. on January 1, 2013, the Senate passed a compromise bill, the American Taxpayer Relief Act of 2012, by a margin of 89–8. The bill would delay the budget sequestration by two months, and bill includes $600 billion over ten years in new tax revenue relative to extending 2012 levels, which is about one-fifth of the revenue that would have been raised had no legislation been passed. The revenue would come from increased marginal income and capital gains tax rates relative to their 2012 levels for annual income over $400,000 for individuals and $450,000 for couples; a phase-out of certain tax deductions and credits for those with incomes over $250,000 for individuals and $300,000 for couples, an increase in estate taxes relative to 2012 levels on estates over $5 million, and expiration of the two-year-old cut to payroll taxes, which is applied to income under the Social Security Wage Base, which was $110,100 in 2012. All these changes would all be made permanent.^[19][20] House Speaker John Boehner promised a prompt vote on the Senate bill, but the prospect of the House passing an amended bill raised the prospect that legislation might not be enacted by the end of the 112th Congress at noon on January 3.^[21]

Analysis

Implications of the Budget Control Act

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