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SUMMARY: President Trump unveiled a $4.8 trillion budget proposal for the 2021 fiscal year on Monday. His plan includes cuts to Medicaid and other social safety net programs, as well as an increase in funding for the Department of Homeland Security. Yamiche Alcindor joins Amna Nawaz to discuss how the president’s “wish list” illustrates his continued commitment to a hardline stance on immigration policy.
SUMMARY: As the year comes to a close, we look back at the past decade in the American economy -- the first without a recession since record-keeping began in the 1950s. While unemployment remains at a historic low, wage growth has been sluggish, and inequality continues to divide the country. David Wessel of the Brookings Institution and The Washington Post’s Catherine Rampell join Jeffrey Brown.
SUMMARY: Thanks to large checks from the wealthy, financial contributions to the 100 largest charities in the U.S. rose 11 percent in recent months. But the share of Americans who give to charity overall continued its long-term slide, with small nonprofits hit the hardest. A number of factors are at play -- including the 2017 tax law. Lisa Desjardins talks to the Chronicle of Philanthropy’s Stacy Palmer.
SUMMARY: The Senate passed a new budget bill Thursday, delivering a rare bipartisan legislative agreement. But critics say the spending it allocates and its temporary suspension of the debt ceiling represent runaway spending and fiscal irresponsibility. Lisa Desjardins joins Judy Woodruff to discuss the huge numbers at play, who opposed the new budget and the different types of spending it reflects.
IMHO: This is a 'duh' question. Answer, Republican Tax Cuts.
Excerpt
SUMMARY:With the close of the government's fiscal year, numbers out this week show the federal budget deficit taking a 17 percent jump from 2017, despite significant economic growth. John Yang takes a closer look into the data and speaks with political correspondent Lisa Desjardins, and David Wessel director of the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution, for analysis.
SUMMARY: On Friday, the Illinois Supreme Court voted unanimously to strike down a law passed in December 2013 that was meant to rescue the state's pension system. For more on the implications of that decision Karen Pierog of Reuters joins Hari Sreenivasan from Washington.
HARI SREENIVASAN, PBS ANCHOR: There was an important court ruling on Friday.
The Illinois Supreme Court voted unanimously to strike down a law passed in December of 2013 that was meant to rescue the state’s pension system.
For more about the implications of that decision and what it could signal for other states, we are joined now from Chicago by Karen Pierog. She has been covering the story for Reuters.
So, bring us up to speed here. If somebody wasn’t paying attention to what the law was in 2013, what did it try to do?
KAREN PIEROG, REUTERS:Well, the law was aimed at trying to ease Illinois’ $105 billion unfunded pension liability, and also to lower the annual amount of money that Illinois has to pay towards pensions every year.
And Illinois has had a structural budget deficit for decades. And it’s — it’s — it was having a very hard time trying to come up with money, you know, to pay for essential state services.
HARI SREENIVASAN: At the time, the legislature said, this is an emergency, a fiscal emergency, they need to act, it is almost like putting out a fire.
They took certain steps, like increasing the retirement age, suspending cost of living adjustments.
GWEN IFILL (NewsHour): Today was the day the Obama administration decided to draw attention to some good economic news for a change. It announced the federal deficit has declined to $483 billion, the lowest level since 2007. The deficit had exceeded a trillion dollars each year during the president’s first term.
But as that news was breaking, the markets embarked on another roller-coaster day, and new polls showed many Americans are skeptical that any economic recovery has trickled down to them.
That was the setting as I sat down this morning with Treasury Secretary Jack Lew and Budget Director Shaun Donovan.
Secretary Lew and Director Donovan, thank you both for joining us.
You have some good news for a change today, the deficit down and continuing to go down to, what, 2.8 percent?
JACK LEW, U.S. Treasury Secretary: Correct.
GWEN IFILL: To what do you attribute that?
JACK LEW: Look, I think that if you look at where we were six years ago, we had an economy that was collapsing, we had unemployment, 700,000 jobs lost a month, and we had markets in chaos.
The President came into office and took tough action. He stabilized the economy. He put in place an economic program to create growth. He put in a program to reform our financial markets and over a period of years worked with Congress on a bipartisan basis to put in place a balanced set of measures to reduce our deficit, starting with the Affordable Care Act, which reduced the deficit, as well as providing a guarantee of health care coverage, and then doing spending reductions and revenue increases that came by making our tax system more fair.
It’s an enormous amount of progress to have seen the deficit drop by, you know, roughly two-thirds, and to reach a point where it’s — we’re now in a 10-year period, looking ahead, of sustainable fiscal policy, which is good for the economy. It means that the economy can not worry about crisis to crisis, and the economy can continue to grow. That’s a very good thing.
With Congress momentarily freed from the Syrian crisis, lawmakers plunged back into their bitter fiscal standoff on Thursday as Speaker John A. Boehner appealed to the Obama administration and Democratic leaders to help him resolve divisions in the Republican ranks that could lead to a government shutdown by month’s end.
In meetings with Democratic and Republican Congressional leaders on Thursday after a session with Treasury Secretary Jacob J. Lew on Wednesday, Mr. Boehner sought a resumption of negotiations that could keep the government running and yield a deficit-reduction deal that would persuade recalcitrant conservatives to raise the government’s borrowing limit.
Much of the federal government will shut down as of Oct. 1 unless Congress approves new spending bills to replace expiring ones, and by mid-October, the Treasury Department will lose the borrowing authority to finance the government and pay its debts.
“It’s time for the president’s party to show the courage to work with us to solve this problem,” said Mr. Boehner, who argued that budget deals have been part of past agreements to raise the debt limit
But a bloc of 43 House Republicans undercut the speaker’s deficit-reduction focus, introducing yearlong funding legislation that would increase Pentagon and veterans spending and delay President Obama’s health care law for a year — most likely adding to the budget deficit. That bloc is large enough to thwart any compromise that does not attract Democratic support.
“Obamacare is the most dangerous piece of legislation ever passed in Congress,” said Representative John Fleming, Republican of Louisiana. “It is the most existential threat to our economy” that the country has seen “since the Great Depression, so I think a little bit of additional deficit is nothing,” he added.
Just five scheduled legislative days stand between the House and a government shutdown that has loomed for months. As of now, Republican leaders appear to have no idea how to stop it. House members are preparing for the worst. A 14-page fact sheet on the impact of a government shutdown, originally written in 2011 by Representative Scott Rigell, Republican of Virginia, has gone back into circulation among House members.
The MOST dangerous event since the Great Depression is the forming of the Tea Party (aka our-way-or-no-way party).
SUMMARY: As Congress returns to Capitol Hill this week, House Speaker John Boehner, R-Ohio, is in a bind to pass major spending bills before the Oct. 1 fiscal year deadline. Gwen Ifill speaks with Todd Zwillich of Public Radio International about how the battle over Obamacare threatens to shut down the government.
As tensions mount and expectations slip lower for any bipartisan consensus on a long-term deficit-reduction plan, a group of Republican senators will resume talks on Thursday with senior presidential advisers at the White House after a lapse that has lasted weeks.
The two sides had said they would meet during the August recess, but the gathering will be the first in that time and is intended to take stock before Congress reconvenes in September. Neither side expressed optimism in interviews, with talks snagged on the same issues that killed past bipartisan efforts: Republicans’ demands for deeper Medicare cuts and President Obama’s insistence that they, in return, agree to higher taxes on the wealthy and some corporations.
The apparent lack of progress after months of intermittent meetings suggests that the effort could soon be sidelined, if not ended, as the president and Congress turn to the more pressing work of negotiating measures to finance the government and increase the nation’s borrowing limit before October deadlines. Without the spending measures, the government would shut down on Oct. 1; without a higher debt limit, the nation would be unable to pay bills after mid-October and would risk another financial crisis.
The goal when the bipartisan meetings began last winter, with Mr. Obama inviting Republicans to dinner after his second inauguration, was to agree on a multiyear fiscal deal before the fall that could ease efforts to pass annual spending bills and increase the debt limit. Now it is probably too late.
JUDY WOODRUFF (Newshour): And to another in our conversations with newly elected members of the U.S. Senate.
Texas Republican Ted Cruz previously served as the state's solicitor general, and also worked in the George W. Bush administration. The 42-year-old Cruz defeated his Democratic challenger by a wide margin in the November election, with strong support from the Tea Party. He took the seat of Republican Kay Bailey Hutchison, who retired.
Over the weekend, Cruz said he would find it very difficult to support Chuck Hagel for defense secretary. Cruz charged that the former Nebraska senator had -- quote -- "advocated weakness" in his foreign policy views.
RAY SUAREZ (Newshour): And that brings us to a big part of the Medicare debate. Should the eligibility age for future retirees be raised from 65 to 67?
Many Democrats have pressured the president this week to oppose any attempt to do so. But in an interview with ABC News, President Obama indicated he may be open to the idea as part of a compromise.
We have our own debate about this and its potential impact.
Neera Tanden is president of the Center for American progress. She previously worked for the Obama administration working on health care reform. And Tevi Troy is a senior fellow at the Hudson Institute and a former deputy secretary of health and human services in the George W. Bush administration. He served as Mitt Romney's health care policy adviser during the just completed presidential campaign.
SUMMARY: While Republicans hold fast to the conviction that spending cuts -- not tax increases -- will fix America's debt problems, new polls reveal the public strongly supports President Obama's approach to the budget. Ray Suarez talks to Pew Research Center's Andy Kohut who says what Americans want most is compromise and balance.
SUMMARY: Though Republicans claim $2.2 trillion would be saved by their plan for long-term deficit reduction, economist Paul Krugman calls it a "vapor plan," with few details on where savings will come from. Gwen Ifill talks to Krugman about why he thinks reducing the deficit too fast could push the economy back into recession.
GWEN IFILL (Newshour): And return to our series of conversations on what to do about the nation's taxes, spending and debt. Last night, we heard from Erskine Bowles, the co-author of a deficit reduction plan that has been the subject of much attention and debate.
Tonight, we get a very different take on this. Paul Krugman is a Nobel Prize-winning economist at Princeton University and a columnist for The New York Times. He joins us now.
SUMMARY: House speaker John Boehner wrote to President Obama to reject a White House plan to raise tax rates for the wealthiest Americans, suggesting instead a counter-offer that raises Medicare eligibility age. Gwen Ifill talks to Erskine Bowles about his deficit reduction plan and how it differs from current proposals on the table.
NOW that the election is over, Washington’s attention is consumed by the looming combination of automatic spending cuts and tax increases known as “the fiscal cliff.” That combination poses risks, including economic contraction and erosion of confidence in government. But it also offers a chance to address our unsustainable and dangerous fiscal trajectory.
Much of the current energy around establishing sound fiscal conditions is focused on plans that theoretically would both contribute revenue to deficit reduction and significantly reduce individual income tax rates. Though hugely appealing, that’s a tall order.
These plans rely on reducing or eliminating many tax deductions, exclusions and the like, known collectively as tax expenditures. Reducing tax expenditures to pay for both lower personal income tax rates and deficit reduction may seem like a politically attractive alternative to raising tax rates or cutting entitlements or other spending.
However, many of these tax expenditures are important and popular policy programs on which people now rely. They include the deductibility of mortgage interest, charitable contributions and the exclusion from income of employer-provided health insurance. Some tax expenditures should be cut back and reformed. But when the substantive effects and political realities of large-scale reductions are examined, it becomes clear that there would not be sufficient savings to reduce tax rates and also cut the deficit.
Not long ago, a former senior official involved in the federal budget process told me that various senators used to meet with him periodically and argue for reducing tax expenditures. He would say that was a good idea, and then go down the list of large tax expenditures. At each one, the senator would say, “Oh no, we can’t do that,” and at some point the senator would repeat his proposition and the conversation would end.
The nonpartisan Congressional Research Service examined the full range of existing tax expenditures and concluded that, “Given the barriers to eliminating or reducing most tax expenditures, it may prove difficult to gain more than $100 billion to $150 billion” a year. But most plans based on reducing tax deductions and other expenditures project revenues of three to four times that amount. And the 1986 Tax Reform Act, cited as an example of lowering rates through tax expenditure reductions (called base broadening), left all of the major individual tax expenditures largely unchanged.
The plans that reduce both tax rates and deficits, like the impressive work by the Simpson-Bowles commission, have served a great public service — raising awareness of our fiscal risks, bringing Democrats and Republicans together, providing a framework aimed at stabilizing debt at an acceptable level, and recognizing the need for substantial revenue increases and spending cuts.
However, these same plans also pose a serious risk to achieving the very objective they seek. If we invest too much time and effort pursuing plans that ultimately prove undesirable and unworkable, we may go down a road that leads nowhere. Then we would be forced to search for a new solution when it will almost surely be too late. In effect, we will have pursued the policy equivalent of a wild-goose chase only to discover that, to mix metaphors, the tax expenditure goose doesn’t have enough golden eggs.
With both parties positioning for difficult negotiations to avert a fiscal crisis as Congress returns for its lame-duck session, Democrats are latching on to an idea floated by Mitt Romney to raise taxes on the rich through a hard cap on income tax deductions.
The proposal by Mr. Romney, the Republican presidential nominee, was envisioned to help pay for an across-the-board income tax cut, a move ridiculed by President Obama as window dressing to a “sketchy deal.” But many Democrats now see it as an important element of a potential deficit reduction agreement — and one they can claim to be bipartisan.
The cap — never fully detailed by Mr. Romney — is similar to a longstanding proposal by Mr. Obama to limit income tax deductions to 28 percent, even for affluent households that pay a 35 percent rate. But a firm cap of around $35,000 would hit the affluent even harder than Mr. Obama’s proposal, which has previously gotten nowhere in Congress.
“Let’s just say there’s a renewed interest,” said Senator Kent Conrad, Democrat of North Dakota and chairman of the Senate Budget Committee. “Part of it is people reflecting on Obama’s proposal, but when Romney said what he said, it just added fuel.”
“I was a little surprised Romney proposed a dollar cap when he did it,” Mr. Conrad added.
The attention on the plan is evidence that ideas on deficit reduction are beginning to take firmer form as the January deadline for dealing with expiring tax cuts and automatic spending reductions draws close. The lame-duck session that begins Tuesday could be one of the most pivotal in years, and the political atmosphere is considerably different than when lawmakers left in October for the fall campaigns.
SUMMARY: Should Congress fail to pass a balanced budget by the end of 2012, America could face serious repercussions. Judy Woodruff talks to the Congressional Budget Office's former director Alice Rivlin and Committee for a Responsible Federal Budget's Maya MacGuineas about why budget reform talks need to shift to policy, not politics.
GWEN IFILL (Newshour): The nation could be pushed into a major recession next year if scheduled spending cuts and tax hikes kick in, in January.
The Congressional Budget Office said going over the so-called fiscal cliff could have dire consequences. Unless Congress acts, Americans can expect more than $300 billion in tax increases, as Bush era tax cuts expire and nearly $200 billion in across-the-board spending cuts Congress agreed to last year in exchange for raising the debt ceiling.
he CBO said those changes would reduce the deficit substantially, but the economy would also shrink by nearly 3 percent during the first half of the year and unemployment could top 9 percent.
We look more closely at this now, with Maya MacGuineas, president of the Committee for a Responsible Federal Budget, and Alice Rivlin, a founding director of the CBO. She's now with the Brookings Institution.
Our nation thanks the no-governance Republicans for sticking to their stance to not consider the revenue-side of this issue.... NOT!
The need for revenue to partly cover the extension of the payroll tax cut and long-term unemployment benefits has pushed Congress to embrace a generational shift in the country’s media landscape: the auction of public airwaves now used for television broadcasts to create more wireless Internet systems.
If a compromise bill completed Thursday by Congress is approved as expected by this weekend, the result will eventually be faster connections for smartphones, iPads and other data-hungry mobile devices. Their explosive popularity has overwhelmed the ability, particularly in big cities, for systems to quickly download maps, video games and movies.
The measure would be a rare instance of the government compensating private companies with the proceeds from an auction of public property — broadcast licenses — once given free.
The auctions, which are projected to raise more than $25 billion, would also further the Obama administration’s broadband expansion plans and create a nationwide communications network for emergency workers that would allow police, fire and other responders from different departments and jurisdictions to talk to each other directly.
Public safety officials have wanted such a seamless communications system ever since the 9/11 terrorist attacks. The sweeping changes are even more remarkable because they resulted not from an effort to address communications policy, but from a hard-fought bipartisan compromise to extend a payroll tax holiday and jobless benefits. Republicans insisted that the extension of the unemployment insurance — a cost of roughly $30 billion — be paid for in full, and one area that both sides could agree on was spectrum sales.
The spectrum auctions are at least one to two years away, but most of the programs they pay for would be covered immediately. Consumers are unlikely to see additional charges since the auction would add new spectrum rather than adding to the costs of existing spectrum.
RAY SUAREZ (Newshour): President Obama won't submit his new budget blueprint to Congress until next month, but local officials across the country are already bracing for bad news.
As part of the deal to raise the debt ceiling, spending must be capped at $1 trillion. And with the money from the federal stimulus programs drying up, local governments are worried they won't get the help they need.
For a closer look at the challenges being faced in two different cities, we are joined by Antonio Villaraigosa, the Democratic mayor of Los Angeles, and Danny Jones, the Republican mayor of Charleston, W.Va.
More excerpts
DANNY JONES (R), mayor of Charleston, W.Va.: I -- speaking only for myself, I think that the if the federal government is going to share money with cities and different political subdivisions around the country, we ought to go back to the way it was done in the '70s, through revenue sharing, and do it equally according to population all throughout the country, and do away with all the specific winner and loser projects, you get this, you get that. ---- ANTONIO VILLARAIGOSA (D), mayor of Los Angeles: What we'd like to see the federal government do is not just cut, however. They have got to invest as well. So they have got to invest in making sure that our roads, our bridges, our ports, our airports are competing with roads, bridges, airports and ports around the world.
They've to make the investments that the federal government has always made. You know, every president since Eisenhower, Democratic and Republican both, have supported investing in the highway system, in our infrastructure system. So those are the kinds of investments that they can make while they're also having to make the cuts that they're going to have to do at a time of high deficits and debt. ---- ANTONIO VILLARAIGOSA: You know, the Republican mayor of Mesa, Ariz. -- or second vice president said yesterday, there are smart cuts and there are dumb cuts.
When you cut infrastructure spending that can create millions of jobs, if we don't pass the surface transportation bill, as an example, we're cutting our nose to spite our face. If you cut our schools and our work force development programs that can retrain our workers for the jobs in the new economy, those are dumb cuts.
So we believe that the federal government has to be smart about the cuts that they make and smart about the investments that we need to make to make America competitive around the world. That's what it's about.
You go to China, Japan, Korea, you go to Western Europe, you go to the developing world, and they're making those investments in their ports, in their airports, in their bridges, in their roads. We have to continue to do the same thing if we want to compete around the world. ---- ANTONIO VILLARAIGOSA: Well, I think, though, in the case of both West Virginia and California and virtually every state in the United States, we always say that the difference between a state, the city and the federal government is, the federal government can print money.
That's why we're in -- an unlimited fashion -- and that is why we are in the problems that we are in. State governments balance their backs -- balance their budget on the backs of cities, counties and school districts. We're the only ones that can't pass the buck. We actually have to make those really tough choices.
We want Congress to make an easy choice, and that's invest in job creation, invest in America's workers again.
COMMENT:Most Americans are in debt because we spend more than our income. Most of us have some sort of big loan (mortgage or car loan), then you add those who have more than 2 or 3 credit cards that are ALWAYS maxed-out. This is our own behavior.
So, why would we expect governments (local, state, federal) to behave differently? They are run by human beings, after all, that tend to behave the way we do.
We should not expect governments to behave differently until we citizens change our own behavior.
Also, government income is from taxes, so JUST cutting taxes is never a good idea.
JEFFREY BROWN (Newshour): Scale back and streamline, but maintain security. Those were the watchwords today as the president and the Pentagon outlined the reshaping of the U.S. military and its focus.
Ray Suarez begins our look.
RAY SUAREZ (Newshour): The strategy shift comes just over two weeks after the last American troops left Iraq in December and as the U.S. presence in Afghanistan has begun winding down. The president highlighted the moment at the Pentagon today.
PRESIDENT BARACK OBAMA: Yes, the tide of war is receding. But the question that this strategy answers is what kind of military will we need long after the wars of the last decade are over. And, today, we're fortunate to be moving forward from a position of strength.
RAY SUAREZ: The defense strategy review outlined at the Pentagon aims to refocus U.S. strategy toward an increased presence in the Pacific with an eye toward China and its rapid military buildup.
The review also marks a shift away from military budgets that exploded in the wake of 9/11. Congress enacted defense cuts last summer amounting to more than $489 billion over the next 10 years. At the same time, the president said today overall defense spending will still increase.
BARACK OBAMA: Over the next 10 years, the growth in the defense budget will slow, but the fact of the matter is this. It will still grow. In fact, the defense budget will still be larger than it was toward the end of the Bush administration. And I firmly believe, and I think the American people understand that we can keep our military strong and our nation secure with a defense budget that continues to be larger than roughly the next 10 countries combined.
RAY SUAREZ: But the cuts will mean streamlining, with the Army dropping from 570,000 possibly to 490,000 soldiers over 10 years.
The size of the Marine Corps is also expected to be reduced. The military also may have to find savings in pay and health care benefits for soldiers and their families.
Defense Secretary Leon Panetta said the changes will not be painless.
SECRETARY OF DEFENSE LEON PANETTA: There's no question -- there's no question that we have to make some tradeoffs and that we will be taking, as a result of that, some level of additional, but acceptable risk. These are not easy choices.
RAY SUAREZ: The choices could get tougher still. When the congressional super committee failed to agree on $1.2 trillion of deficit savings, it automatically triggered an additional $500 billion in defense cuts. Those will take effect in January of 2013, unless Congress intervenes.
For all that, the commander in chief insisted today he doesn't mean to repeat mistakes made after World War II and Vietnam by cutting too much.
BARACK OBAMA: Our military will be leaner, but the world must know the United States is going to maintain our military superiority with armed forces that are agile, flexible and ready for the full range of contingencies and threats.
RAY SUAREZ: That did not stop criticism of the new strategy from Republicans in Congress.
The chair of the House Armed Services Committee, California Congressman Howard "Buck" McKeon, issued a statement calling it "a lead-from-behind strategy for a left-behind America."
In the meantime, no specific dollar amounts were outlined today. They will wait for the 2013 budget, which President Obama will submit to Congress next month.
The Motor City is on track to run out of cash in four months. Today, the Michigan state government began a 30-day review of the city's troubled finances, a move that could lead to a state takeover.
Special correspondent Desiree Cooper of Detroit Public TV has the story.
I am Retired U.S. Navy (22yrs) and a Vietnam Veteran. After my Navy retirement I was in the computer related industry, now retired. In 2000 I was a registered Republican and voted for George W. Bush. Six months of having Bush in the Whitehouse forced me to re-evaluate my political stance. I had always thought of myself as a Moderate Republican, but was a Republican by "default" NOT because of close examination of the GOP. Due to what has happened in America since 2000, I now consider myself a progressive, and registered as a Non-Affiliated voter.
*Anti-First Amendment policies that attempt to turn America into a theocracy by enshrining ANY religious belief as law.
* Any attempt to suppress human or Constitutional rights.
* Any law or policy that supports discrimination based on religion, ethnicity, race/color, gender, sexual orientation, or any law that does NOT support Equal Treatment under the law.
*Any law or policy that attempts to suppress Freedom of the Press or Free Speech.
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