Deficits

S&P: U.S. Rating Will Be Slashed To 'Selective Default' If Payment Missed

Posted on Monday, July 04, 2011

NEW YORK - The United States would immediately have its top-notch credit rating slashed to "selective default" if it misses a debt payment on August 4, Standard & Poor's managing director John Chambers told Reuters. Chambers, who is also the chairman of S&P's sovereign ratings committee, said on Tu...

Deficit Hysteria: Washington's War on the Young

Posted on Thursday, June 30, 2011

It's one of modern political life's strange ironies that defending Social Security and Medicare is considered an "old people's issue." Old people are doing just fine with these programs, thank you very much -- at least so far. Anti-government hawks like Alan Simpson and Pete Peterson also made a d...

White House revamping plan to sell federal buildings

Posted on Thursday, March 17, 2011

The Obama administration is hoping to revamp plans to sell off thousands of federal buildings by recruiting outside experts to determine which office towers, courthouses and warehouses the government no longer needs. Once established, a new independent commission would recommend potential savings t...

President Submits FY 2012 Budget; House Republicans Propose FY 2011 Spending Cuts

Posted on Wednesday, March 16, 2011

On February 14, 2011, President Obama released his proposed Budget for FY 2012. The Budget includes cuts aimed at reducing the deficit, but does not project a balanced Budget even as far out as 2020. As is always the case, the President's Budget is the starting point for the work of Congress and wil...

Sale of federal buildings could be difficult

Posted on Tuesday, March 15, 2011

President Obama could not have been more clear, when outlining his budget proposal in Baltimore last week. "Now, some of the savings will come through less waste and more efficiency," he said. "To take just one example, by getting rid of 14,000 office buildings, lots and government-owned propertie...

The question is: How close is America to fiscal crisis?

Posted on Tuesday, March 15, 2011

The Congressional Budget Office projects that America's 2011 deficit will be $1.5 trillion, or 9.8% of GDP, and debt held by the public in the 2011 fiscal year will approach 70% of GDP. How close is America to facing a bond market crisis? Should drastic cuts to the budget be made now? Over what hori...

A RESPONSE: America is bankrupt

Posted on Tuesday, March 15, 2011

THE US has a fiscal gap—the present value of all its future spending (including servicing its official debt) less all its future taxes of $202 trillion—almost 14 times GDP. Greece, by comparison, has a fiscal gap of about 11 times GDP. To close the US fiscal gap would require raising all federal tax...

A RESPONSE: Gradual steps should be taken to avert an abrupt crisis

Posted on Tuesday, March 15, 2011

IT IS clear that America cannot just "count on" growth going forward. While growth-enhancing strategies may work, and corporations may invest more as jobs and demand pick up, creating a virtual cycle, the scale of efforts and mixed results over the past two years suggest that any counting on growth ...

A RESPONSE: The ingredients are in place for a crisis

Posted on Tuesday, March 15, 2011

IT'S a good thing the cacophony surrounding Ben Bernanke’s testimony to the Congressional budget committee last week passed largely unheard in the financial community. Congresswoman Schwartz, in a litany of “what-ifs”, asked Mr Bernanke if he thought it was morally correct for Congress to require Am...

GOP Budget Plan Would Cut CFPB Funding Nearly In Half

Posted on Thursday, February 17, 2011

WASHINGTON -- A new federal budget proposal from House Republicans would dramatically restrict the budget of the new Consumer Financial Protection Bureau during its first year of operation. No House Republicans voted for the Wall Street reform bill that created the CFPB, which is currently being ...

The question is: How close is America to fiscal crisis?

Posted on Thursday, February 17, 2011

The Congressional Budget Office projects that America's 2011 deficit will be $1.5 trillion, or 9.8% of GDP, and debt held by the public in the 2011 fiscal year will approach 70% of GDP. How close is America to facing a bond market crisis? Should drastic cuts to the budget be made now? Over what hori...

A RESPONSE: America is bankrupt

Posted on Thursday, February 17, 2011

THE US has a fiscal gap—the present value of all its future spending (including servicing its official debt) less all its future taxes of $202 trillion—almost 14 times GDP. Greece, by comparison, has a fiscal gap of about 11 times GDP. To close the US fiscal gap would require raising all federal ...

A RESPONSE: Deficit reduction should include tax reform

Posted on Thursday, February 17, 2011

THE US fiscal position has deteriorated significantly over the past few years. Fiscal policymakers have so far opted to postpone fiscal consolidation with a view to getting the economy back on a firmer footing. But the US is walking a fine line. The costs of delaying consolidation in terms of risks...

A RESPONSE: There is no fundamental deficit crisis

Posted on Thursday, February 17, 2011

HOW close is America to fiscal crisis, The London Economist asks: "The Congressional Budget Office projects that America's 2011 deficit will be $15 trillion, or 9.8% of GDP, and debt held by the public in the 2011 fiscal year will approach 70% of GDP...". John Makin laments that "a a fiscal crisis—...

A RESPONSE: It isn't enough to trust government promises

Posted on Thursday, February 17, 2011

BRAD DELONG clearly has faith in official projections to a much greater degree than I do. Perhaps I have a jaundiced UK perspective and don't fully understand what happens in the US. By way of example, however, I offer exhibit A, which shows medium term projections for the UK's fiscal position made ...

Budget Proposal

Posted on Wednesday, February 16, 2011

Budget Reax Lori Montgomery summarizes: "President Obama submitted a budget blueprint for fiscal 2012 on Monday full of surgical cuts and cautious trade-offs to lawmakers clamoring for bold action to reduce government spending and control a budget deficit expected to rise to a record $1.6 trillio...

Obama Proposing Record Budget Deficits; Is America Doomed to Follow Greece?

Posted on Wednesday, February 16, 2011

As the United States national debt reaches parity with total annual GDP, President Barack Obama continues to preside over a record level of deficit spending by the federal government. He has just sent to Congress a proposed $3.73 trillion budget for FY 2012, while forecasting a record $1.65 trillion...

Fed's Lockhart: U.S. Can't Grow Out Of Debt Problems

Posted on Monday, February 14, 2011

The Federal Reserve's monetary stimulus plan can play a role in bringing down unemployment, even if the country's jobless rate is unlikely to fall below pre-crisis levels, a top Fed official said. The Fed in November announced a controversial plan to purchase an additional $600 billion in bonds to ...

U.S. Will Hit Debt Limit In April/May, Treasury Says

Posted on Monday, February 07, 2011

WASHINGTON - The United States will hit a $14.3 trillion statutory limit on its debt slightly later than previously estimated, the Treasury said on Wednesday as it unveiled a still-hefty debt auction schedule. Treasury officials said the limit would now be hit between April 5 and May 31, versus a p...

NATIONAL DEFICIT AND TRADE DEFICIT - CBO projects U.S. budget deficit to reach $1.5 trillion in 2011

Posted on Friday, February 04, 2011

The still-fragile economy and fresh tax cuts approved by Congress last month will drive the federal deficit to nearly $1.5 trillion this year, the biggest budget gap in U.S. history, congressional budget analysts said Wednesday. The grim forecast from the nonpartisan Congressional Budget Office ca...

FEDERAL GOVERNMENT - CBO projects U.S. budget deficit to reach $1.5 trillion in 2011, highest ever

Posted on Friday, February 04, 2011

The still-fragile economy and fresh tax cuts approved by Congress last month will drive the federal deficit to nearly $1.5 trillion this year, the biggest budget gap in U.S. history, congressional budget analysts said Wednesday. The grim forecast from the nonpartisan Congressional Budget Office ...

US COMPARED TO OTHER COUNTRIES - U.S. Stellar Bond Rating in Jeopardy:Moody's

Posted on Thursday, January 27, 2011

Rising federal debt could pose a negative outlook for the country’s AAA credit rating, Moody’s warned in a quarterly report on Thursday. The negative outlook would be dropped only if the U.S. imposed measures of fiscal austerity, such as curbing spending or raising taxes, according to the repor...

Tax Cuts

Posted on Thursday, January 27, 2011

Here's the question: Do tax cuts cause deficits? If not, then there's no reason to worry about the Congressional Budget Office's revised estimate that the deficit will reach $1.5 trillion this year, not $1 trillion, as they'd predicted in 2010. The bulk of the difference, as you can see in this ta...

Multifamily Fares Worst as Defaults Hit New High

Posted on Monday, January 10, 2011

NEW YORK CITY-Confirming that this past October's one-month drop in the CMBS delinquency rate was an anomaly, the December 2010 percentage of loans at least 30 days past due climbed 27 basis points to reach an all-time high of 9.2%, with multifamily faring the worst, according to Trepp. Separately,...

GOP plans spending cuts 'lock box'

Posted on Monday, December 27, 2010

House Republicans have unveiled a proposed change in House rules that would create a “spending reduction” account to accompany each appropriations bill, the latest move by the GOP to show it’s serious about actually cutting spending next year. The new mechanism would set aside in a “lock box” any s...

How So-Called Deficit Experts Would Destroy Our Already Broken Pension System

Posted on Tuesday, December 14, 2010

In yet another example of "innumeracy" when it comes to retirement adequacy, the Bipartisan Policy Center has proposed tackling the deficit by halving the amount that employers and employees can contribute to 401(k) accounts because they insist that affluent people will retire rich and we should sto...

All or Nothing = Nothing

Posted on Wednesday, December 08, 2010

Two plans for reducing the federal deficit are now on the table. One of them, proposed by the chairmen of President Obama’s debt-reduction commission, Erskine Bowles and Alan Simpson, was endorsed on Friday by 11 of the 18 panel members. The other comes from the nonprofit Bipartisan Policy Center. T...

Hidden Agendas Killed the Deficit Commission

Posted on Tuesday, December 07, 2010

The National Commission on Fiscal Responsibility and Reform ("Deficit Commission") was charged with coming up with a plan to reduce the budget deficits and accumulated debt caused by tax cuts for the rich and military spending increases. It was supposed to come up with a bipartisan package that, tak...

Commission's final deficit report preserves controversial spending cuts

Posted on Friday, December 03, 2010

The leaders of President Obama's fiscal commission released a final report Wednesday that is full of political dynamite, recommending sharp cuts in military spending, a higher retirement age and reforms that could cost the average taxpayer an extra $1,700 a year. But as commission co-chairmen Ersk...

NAR on Deficit Reduction and Mortgage Interest Deduction

Posted on Wednesday, December 01, 2010

On Nov. 10, 2010 the chairmen of the bipartisan deficit-reduction commission, appointed by President Obama, introduced a preliminary draft proposal that included a suggestion to pare back the mortgage interest deduction. It is important to note that this initial report is thin on details and is expe...

Deficit Commission Member Rep. Jan Schakowsky Offers a Better Plan

Posted on Wednesday, December 01, 2010

Rep. Jan Schakowsky (D-Ill.), one of the 18 members of the Deficit Commission, has offered her own plan in response to the Commission's proposals, which she has rejected. Rep. Schakowsky's major concern is that the Commission's recommendations to raise the age of enrollment in Social Security and cu...

Debt-Panel Chairmen Work to Gain Support

Posted on Wednesday, December 01, 2010

The chairmen of the White House's debt-reduction commission are making last-minute changes to their provocative early draft in an effort to broaden support before a crucial Wednesday vote, people familiar with the matter said. The co-chairmen, Democrat Erskine Bowles and former Republican Sen. Alan...

Washington Post Budget Hocus Pocus

Posted on Wednesday, December 01, 2010

Possibly the most amazing aspect of the Commission on Fiscal Responsibity's drive to reduce the federal "deficit" are proposals by its chairs and others to cut benefits payable by Social Security, although the program pays its own way and has generated robust annual surpluses, now totaling $2.4 tril...

Did the Rich Cause the Deficit?

Posted on Wednesday, December 01, 2010

Washington is inundated with deficit commissions. The country has piled up a huge debt because we cut taxes for the wealthy and borrowed to make up the difference. But everyone says we can't fix the problem by raising taxes on the rich in a recession because taxes "take money out of the economy....

Did the Rich Cause the Deficit?

Posted on Monday, November 22, 2010

Washington is inundated with deficit commissions. The country has piled up a huge debt because we cut taxes for the wealthy and borrowed to make up the difference. But everyone says we can't fix the problem by raising taxes on the rich in a recession because taxes "take money out of the economy." Is...

Some Fiscal Reality

Posted on Thursday, November 11, 2010

The draft proposal by the chairmen of President Obama’s deficit-reduction commission was a welcome antidote to the low-minded debate that dominated the midterm elections, in which politicians all vowed to reduce the deficit but offered no credible plans. The proposal, released Wednesday, comes fro...

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