Archive for ‘Budgets’

September 6, 2011

A Closer Look at Jon Huntsman

by Vince

He released his economic plan last week. Take a look at it and the feedback on it in comparison to the 2012 GOP field.

September 6, 2011

Unemployment’s Far-Reaching Effects

by Vince

Ezra Klein digs into a few studies that exposes the health and educational pains inflicted on pupils and families as a result of unemployment:

Last year, Mike Konczal flagged a 2009 study by Ann Huff Stevens and Jessamyn Schaller of UC-Davis that examined the relationship between parental job loss and children’s academic achievement, drawing on data about job loss and grade retention from 1996, 2001 and 2004 panels of the Survey of Income and Program Participation:

We find that a parental job loss increases the probability of children’s grade retention by 0.8 percentage points, or around 15 percent. After conditioning on child fixed effects, there is no evidence of significantly increased grade retention prior to the job loss, suggesting a causal link between the parental employment shock and children’s academic difficulties. These effects are concentrated among children whose parents have a high school education or less.

 

In the end, the researchers concluded, “one percentage point higher unemployment rate leads to a 0.3 percentage point increase in the probability that a child repeats a grade.” If this is true, Konczal points out, the cumulative impact of unemployment is staggering. “There are roughly 55 million students in K-12 in the country right now. If unemployment is 1% higher that means, roughly, 165,000 additional years of schooling will be repeated,” he writes.

But just as children are at higher risk of underachieving, education budgets are being slashed across the country as the economy remains anemic and the politics of austerity have taken hold. It’s a continuous pile-up that could have lasting damage that goes well beyond sheer employment numbers.

September 6, 2011

USPS Is Going Belly Up

by Vince

Thanks in large to their union clause of “no lay-off’s”. With such a clause paired with hefty benefits and 80% of the budget spent on wages, how can you possibly run a sustainable business?

September 6, 2011

Political Cartoon of the Day II

by Vince

August 29, 2011

School superintendent gives up $800k in pay

by Vince

This guy’s story is amazing (the full article is worth reading):

FRESNO, Calif. (AP) — Some people give back to their community. Then there’s Fresno County School Superintendent Larry Powell, who’s really giving back. As in $800,000 — what would have been his compensation for the next three years.

Until his term expires in 2015, Powell will run 325 schools and 35 school districts with 195,000 students, all for less than a starting California teacher earns.

“How much do we need to keep accumulating?” asks Powell, 63. “There’s no reason for me to keep stockpiling money.”

(…)

Powell’s answer? Ask his board to allow him to return $288,241 in salary and benefits for the next three and a half years of his term. He technically retired, then agreed to be hired back to work for $31,000 a year — $10,000 less than a first-year teacher — and with no benefits.

“I thought it was so very generous on his part,” said school board member Sally Tannenbaum. “We get to keep him, but at a much lower rate.”

His move was so low-key, his manner so unassuming, that it took four days after the school board meeting for word of his act to get out to the community. There were no press releases or self-congratulatory pats on the back.

Yes, what he did was great and the money he kicks back these next three years will, as mentioned in the article, go to the S.D. However, don’t be fooled by this. He will still get a six-figure retirement that rises with cost of living. That reform may be beyond his own control but it is what it is.

(thanks V.S.!)

August 27, 2011

Selectively Doing Away With Pork Spending

by Vince


When a politician joins hand in hand with a crusade-type campaign against pork barrel spending (which is believed in some camps as the entire reason we are in debt), wouldn’t you then oppose all pork spending?

Rep. Michele Bachmann has gotten a lot of flak for taking hundreds of thousands of dollars in subsidies from farm assistance programs she has decried as “outrageous pork.” Her opposition was well founded: The subsidies make our food less healthy and more carbon intensive and distort our trade with other countries. But Lindsey Boerma reports that Bachmann’s responding to the criticism by walking back her stance:

Not long ago, Rep. Michele Bachmann viewed farm subsidies as “outrageous pork.” But after a summer of blistering criticism about the nearly $260,000 in government handouts that went to a family farm partially owned by Bachmann and her husband, the archconservative and GOP presidential candidate softened her tone considerably in an interview with National Journal.

While she insisted that “our federal budget needs a complete overhaul, and agricultural subsidies are no exception,” Bachmann would not commit to doing away with them without seeing details of any future legislation. “If all farm subsidies were ended, that would be a complete change of policy over the last 80 to 90 years of American history, and that would be a very interesting vote,” she said. “So, of course, I would have to look at that before I could tell you how I was going to cast my vote.”

The hypocrisy of this “self-made woman” who I bet attests that she relies on no one.

August 27, 2011

Obsessing Over Entitlements

by Vince

For those who are obsessed over cutting entitlement spending (strictly speaking – Medicare/Medicaid, Social Security, Welfare, et al) and believe that alone will solve our entire budget mess, Byron York has an interesting piece that looks at where our budgetary woes have come from lately:

Was there a steep rise in entitlement spending? Did everyone suddenly turn 65 and begin collecting Social Security and using Medicare? No: The deficits are largely the result not of entitlements but of an explosion in spending related to the economic downturn and the rise of Democrats to power in Washington. While entitlements must be controlled in the long run, Washington’s current spending problem lies elsewhere.

A lot of the higher spending has stemmed directly from the downturn. There is, for example, spending on what is called “income security” — that is, for unemployment compensation, food stamps and related programs. In 2007, the government spent $365 billion on income security. In 2011, it’s estimated to spend $622 billion. That’s an increase of $257 billion.

Then there is Medicaid, the health care program for lower-income Americans. A lot of people had lower incomes due to the economic downturn, and federal expenditures on Medicaid — its costs are shared with the states — went from $190 billion in 2007 to an estimated $276 billion in 2011, an increase of $86 billion. Put that together with the $257 billion increase in income security spending, and you have $343 billion.

Add to that the $338 billion in decreased revenues, and you get $681 billion — which means nearly half of the current deficit can be clearly attributed to the downturn.

That’s a deficit increase that would have happened in an economic crisis whether Republicans or Democrats controlled Washington. But it was the specific spending excesses of President Obama and the Democrats that shot the deficit into the stratosphere.

There is no line in the federal budget that says “stimulus,” but Obama’s massive $814 billion stimulus increased spending in virtually every part of the federal government. “It’s spread all through the budget,” says former Congressional Budget Office chief Douglas Holtz-Eakin. “It was essentially a down payment on the Obama domestic agenda.” Green jobs, infrastructure, health information technology, aid to states — it’s all in there, billions in increased spending.

As for the Troubled Assets Relief Program, or TARP — it has no specific line in the budget, either, but that is because it was anticipated to pay nearly all of its own cost, which it has.

Spending for Social Security and Medicare did go up in this period — $162 billion and $119 billion, respectively — but by incremental and predictable amounts that weren’t big problems in previous years. “We’re getting older one year at a time, and health care costs grow at 7 or 8 percent a year,” says Holtz-Eakin. If Social Security and Medicare were the sole source of the current deficit, it would be a lot smaller than it is.

The bottom line is that with baby boomers aging, entitlements will one day be a major budget problem. But today’s deficit crisis is not one of entitlements. It was created by out-of-control spending on everything other than entitlements. The recent debt-ceiling agreement is supposed to put the brakes on that kind of spending, but leaders have so far been maddeningly vague on how they’ll do it.

More debate on this here.

July 30, 2011

Quote of the Day

by Vince

“For those who insist that the center is always the place to be, I have an important piece of information: We already have a centrist president. Indeed, Bruce Bartlett, who served as a policy analyst in the Reagan administration, argues that Mr. Obama is in practice a moderate conservative. Mr. Bartlett has a point.

The president, as we’ve seen, was willing, even eager, to strike a budget deal that strongly favored conservative priorities. His health reform was very similar to the reform Mitt Romney installed in Massachusetts. Romneycare, in turn, closely followed the outlines of a plan originally proposed by the right-wing Heritage Foundation. And returning tax rates on high-income Americans to their level during the Roaring Nineties is hardly a socialist proposal.

True, Republicans insist that Mr. Obama is a leftist seeking a government takeover of the economy, but they would, wouldn’t they? The facts, should anyone choose to report them, say otherwise.” –Paul Krugman

July 30, 2011

Meet the 14th Amendment this Tuesday

by Vince

You may wonder, what would happen if the hours roll by Tuesday and there still is not a resolution to our debt ceiling quagmire? In comes the ace in the hole for Barack: the 14th amendment. This is a sigh of relief (as well as a back door escape hatch) in the face of Republican nihilism. Even Bill Clinton has thrown his hat into Obama’s corner:

As Bill Clinton, another former professor of constitutional law, recently declared, if he were president, he would invoke the Fourteenth Amendment to raise the debt ceiling “without hesitation, and force the courts to stop me.”

July 6, 2011

Quote of the Day

by Vince

“If the debt ceiling talks fail, independents voters will see that Democrats were willing to compromise but Republicans were not. If responsible Republicans don’t take control, independents will conclude that Republican fanaticism caused this default. They will conclude that Republicans are not fit to govern. And they will be right,” – David Brooks, NYT.

H/T: The Dish

June 24, 2011

Picturing this School Scenario

by Vince

Imagine what a typical school district would look like with these budget cuts:

—140-plus staff members were furloughed.

—Dozens of staff members are being shuffled around the district to fill holes, which means many students will be meeting new faces.

—Nearly all special education and English Language Learner aides were furloughed, save for those required by law because of a student’s needs. ELL aides help students whose primary language is something other than English.

—The 3-year-old character education program was eliminated. The program’s creator earned national acclaim for her model of mentoring troubled students.

—Elementary guidance counselors, some secondary guidance counselors and an at-risk coordinator who helped students with issues at home were furloughed.

—The athletic teams remain intact, but the athletic budget was cut by $100,000. It is not yet clear how the department will make up for the lost revenue.

—The district’s security team was eliminated. The team helped monitor school activities and provide a buffer between students and police to reduce arrests and keep students safer. It was created two years ago.

—Students won’t have the use of library aides.

—At the elementary level, students won’t have music, physical education or art teachers. Their classroom teacher will be in charge of providing those subjects. The interim Superintendent says that elementary teachers all have certification to cover those areas.

—Students won’t have reading and math coaches around to add more individualized instruction.

—At the secondary level, the performing arts program that offered theater performances was eliminated.

—The high school pool, in dire need of repair, has been closed.

—Class sizes will increase, particularly at the secondary level. Some classes could be above 30-35 students, according to the district.

Now add to the equation that this is regarding the York City school district, a district much in need of smaller classes, classroom aides, extra curricular classes, and English language learning aides. Could these cuts, coupled with a 5% tax increase (that overrode the normal 3% max), happen in a suburban school without a national level uprising?

June 11, 2011

Global Military Spending in one graph

by Vince

The Economist captions:

ON JUNE 8th China’s top military brass confirmed that the

country’s first aircraft carrier, a refurbishment of an old Russian carrier, will be ready shortly. Only a handful of nations operate

carriers, which are costly to build and maintain. Indeed, Britain has recently decommissioned its sole carrier because of budget pressures. China’s defence spending has risen by nearly 200% since

2001 to reach an estimated $119 billion in 2010—though it has remained fairly constant in terms of its share of GDP. America’s own budget crisis is prompting tough discussions about its defence spending, which, at nearly $700 billion, is bigger than that of the next 17 countries combined.

 

 

June 6, 2011

What the Money Spent on “Defense” Can Buy Us

by Vince

AllGov shows what domestic programs we could spend the $7.6 trillion defense budget since 2001 on:

Fill the Medicare Gap: If Congress redirected just one-fifth of the budget increases from 2000 to 2011 for defense spending, it would be enough to eliminate the long-term budget hole in the Medicare program.
 
Fund Head Start for 15 Years: Instead of 10 years of warfare in Afghanistan, the U.S. could have secured 15.6 years of early childhood education and support through Head Start for the same price.
 
Insure the Uninsured: Another way to spend the Afghanistan war chest would be on the uninsured. The budget for fighting the Taliban is enough to cover every American without health insurance for 1.7 years.
 
Help State Capitols: A total of 46 states are facing budget shortfalls this fiscal year. Collectively, they need about $130 billion. Ending the war in Afghanistan and getting entirely out of Iraq would save $170 billion—more than enough to wipe out the red ink from Albany to Sacramento.
 
Instead of Iraq…: Even with the end of combat operations in Iraq, the U.S. is still spending $50 billion annually to maintain a large contingent of troops in the country. For this same amount of money, Washington could ensure a year’s worth of health care for 24.3 million poor children, or salaries for more than 725,000 elementary school teachers or nearly 830,000 firefighters.
June 6, 2011

Fasting for the Billions

by Vince


Jim Wallis from Sojo, above, fasts during the U.S. budget crisis.

May 27, 2011

Questions For Obama

by Vince

Ezra Klein has a few scathing ones for our POTUS:

1. You have repeatedly lauded the economy of the Clinton years, yet in a time of high and mounting deficits, you want to make most of the Bush tax cuts permanent. Economically speaking, what makes you believe the Clinton-era tax rates are too high?

4. The main differences between your budget and the Simpson-Bowles report is that your budget raises less in taxes and cuts less in defense spending. Why were those decisions made?

5. You’ve talked frequently about the need to “win the future” through new investments and initiatives. But unlike the budgets proposed by the House Progressives or Andy Stern or EPI, Demos and the Century Foundation, there’s nothing in your budget that specifically commits to any such investments, nor any particular funding source dedicated to them. If these investments are so important, why not build them into your budget? Why accept the framework that this discussion should be entirely about cuts?

May 27, 2011

Libraries Crumble

by Vince

Charles Simic laments:

All across the United States, large and small cities are closing public libraries or curtailing their hours of operations. Detroit, I read a few days ago, may close all of its branches and Denver half of its own: decisions that will undoubtedly put hundreds of its employees out of work. When you count the families all over this country who don’t have computers or can’t afford Internet connections and rely on the ones in libraries to look for jobs, the consequences will be even more dire. People everywhere are unhappy about these closings, and so are mayors making the hard decisions. But with roads and streets left in disrepair, teachers, policemen and firemen being laid off, and politicians in both parties pledging never to raise taxes, no matter what happens to our quality of life, the outlook is bleak. “The greatest nation on earth,” as we still call ourselves, no longer has the political will to arrest its visible and precipitous decline and save the institutions on which the workings of our democracy depend.

I see this when I am at the library in York. Scores of grown adults and kids do not have computers at home and rely strongly on their 2 hours allotted to them a day to look for jobs, work on schoolwork, and yes a fair amount of time set aside to watch YouTube videos.

Once I started to enjoy reading, libraries became my new toy store. Free books, so many services and resources at your fingertips (secondary language services, such as Rosetta Stone, are there to use and others are available to check out) and more all there and paid for by our tax dollars.

Simic makes a few more points worth noting:

This was just the start. Over the years I thoroughly explored many libraries, big and small, discovering numerous writers and individual books I never knew existed, a number of them completely unknown, forgotten, and still very much worth reading. No class I attended at the university could ever match that. Even libraries in overseas army bases and in small, impoverished factory towns in New England had their treasures, like long-out of print works of avant-garde literature and hard-boiled detective stories of near-genius.

Wherever I found a library, I immediately felt at home. Empty or full, it pleased me just as much. A boy and a girl doing their homework and flirting; an old woman in obvious need of a pair of glasses squinting at a dog-eared issue of The New Yorker; a prematurely gray-haired man writing furiously on a yellow pad surrounded by pages of notes and several open books with some kind of graphs in them; and, the oddest among the lot, a balding elderly man in an elegant blue pinstripe suit with a carefully tied red bow tie, holding up and perusing a slim, antique-looking volume with black covers that could have been poetry, a religious tract, or something having to do with the occult. It’s the certainty that such mysteries lie in wait beyond its doors that still draws me to every library I come across.

Pictured: a library established by Andrew Carnegie.

Tags:
May 26, 2011

Budget Plan Wrap-Up

by Vince

David Weigel briefly summarizes the four plans that all went down in failed votes in the Senate yesterday:

The Ryan Budget: 57 nos, 40 ayes. No Democrats voted “aye,” and five Republicans — Brown, Collins, Murkowski, Paul, and Snowe — voted no. Paul voted “no” because the bill doesn’t go far enough.

The Obama Budget: 97 nos. You read that right. No “ayes.” It was nice of Democrats to tee up an embarrassment of their own, to go with the other embarrassments.

The Toomey Budget: 55 nos, 42 ayes. Only Brown, Collins and Snowe voted against it. Why the difference? Toomey’s budget didn’t touch Medicare, and balanced the budget in nine years through big discretionary spending cuts.

The Paul Budget: 90 nos, 7 ayes. Only Coburn, DeMint, Hatch, Lee, McConnell, Paul, and Vitter voted for this libertarian dream of a budget, which cuts (non-defense) spending to 2008 levels and levels the Departments of Commerce, Energy, Education, and Hud.

I will be honest in that I didn’t follow these budgets that closely. The one I followed the most was Paul Ryan’s.

Ezra Klein provides more perspective.

May 25, 2011

Political Cartoon of the Day

by Vince

Some other commandments you could add:

  1. Tho shalt increase the military budget.
  2. Tho shalt protect the fetus but refuse to provide a safety net during the rest of it’s life.
May 23, 2011

The Budget Crisis View Of Pennsylvanian Schools

by Vince

The impacts are stark:

  • About 31 percent of districts are considering cutting full-day kindergarten next year, compared with 1 percent that eliminated it this year.
  • About 86 percent of districts anticipate seeing class sizes increase next year, compared with 17 percent increasing this year.
  • 91 percent of districts don’t plan to fill empty positions next year, and about two-thirds plan to lay off instructional staff.
The full report (pdf) is worth a read.
May 23, 2011

The $1 Billion Bully

by Vince

That would be Barack Obama in the 2012 campaign. Who can stand up against that giant sum of money and subsequent campaign power?