Today in Washington, D.C. - Jan 27, 2011: CBO: Deficit To Hit $1.5 Trillion This Year

This afternoon, the Senate resumed debate on the rules resolutions; depending on how much debate time is used, this afternoon or evening there will be up to 5 roll call votes on rules resolutions. Several offered by Democrats concerning the filibuster are expected to fail to get the necessary votes to be adopted.

Yesterday Sen. Mitch McConnell (R-Ky) introduced S. 194, as a companion bill to H.R. 359, introduced earlier this year by Rep. Tom Cole (R-Ok.) and was passed by the House of Representatives yesterday. The bill is to eliminate taxpayer funding of the Presidential Election Campaign fund, which according to the CBO would save taxpayers $617 million over the next 10 years. Certainly, with the country staring at a $1.5 trillion deficit, it’s only a small first step, but it’s precisely the kind of thing the federal government doesn’t need to be spending money on. McConnell explained, “The American people have spoken and the verdict is clear. They’d rather reduce the deficit than pay for attack ads and robo-calls. In a time of exploding deficits and record debt the last thing the American people want right now is to provide what amounts to welfare for politicians.”

The New York Times reported on Randy Neugebauer (R-TX) On Neugebauers investigation regarding legal fees expended by Fannie Mae and Freddie Mac in defense of the officials who led those organizations prior to, and during the subprime mortgage mess. Today, Neugebauer released a statement: "Over $160 million of the taxpayer’s money was spent for securities-related lawsuits and indemnification agreements for Freddie and Fannie executives. . . . Are the conservators looking out for the taxpayers? Do they have the right tools and structure to do so? My intent is to investigate other activities occurring within Fannie Mae and Freddie Mac that diminish the taxpayers’ potential recovery and minimize capital infusion. This drain on the American taxpayer must be plugged as quickly as possible.

“The aggregate number amounts the taxpayer has expended thus far are . . .
Total Amount of Legal Expenses Post Conservatorship for Freddie and Fannie: $410.7 million. Total Legal Fees for Securities-related Lawsuits and Indemnification Agreements for Freddie and Fannie: $162.4 million."

Byron York reported this morning on the upshot of negotiations about Senate rules: “The filibuster was untouched; nothing has been done to it. ‘Literally nothing,’ says a Republican Hill source. . . . [C]ooler heads prevailed among Democrats, and filibuster ‘reform’ is dead -- for now and for the foreseeable future.”

The New York Times reports today, “The government’s budget deficit will soar to nearly $1.5 trillion this year, the nonpartisan Congressional Budget Office said Wednesday, an anticipated but politically galvanizing calculation that further intensified the partisan battle over the nation’s fiscal future. . . . The deficit was $1.4 trillion in 2009 and $1.3 trillion in 2010.” The Wall Street Journal adds, “At that size, the deficit—up from $1.29 trillion in 2010—would be roughly $60 billion more than the White House projected last summer, the nonpartisan Congressional Budget Office said Wednesday. . . . As a percentage of the nation's economic output, the 9.8% deficit would be the second-largest since World War II, behind only the 10% level in 2009.”

The Washington Post notes, “Lawmakers scrambled Wednesday to respond to the darkening budget picture, with Republicans pressing their call for sharp and immediate cuts in domestic spending. Twenty-one Senate Republicans, meanwhile, unveiled a plan to amend the U.S. Constitution to require balanced budgets, a top priority of the tea party movement. Democrats resisted both initiatives, arguing that amending the Constitution, a lengthy process that requires a vote in all 50 state legislatures, would do little to address the current problem.”

The Times writes, “The shift into full battle mode on Capitol Hill came a day after President Obama, aiming to modulate the Republican demands for cuts, called in his State of the Union speech for a partial five-year freeze in domestic spending by the federal government — a more gradual imposition of fiscal discipline, while still increasing some spending in education, research and other areas. Republicans quickly rejected that idea as insufficient. ‘Last night, the president spoke about our dangerous debt and his commitment to bringing it down,’ Senator Orrin G. Hatch, Republican of Utah, said at a news conference. ‘But actions speak louder than words. He, unfortunately, recommitted to spending more money we don’t have.’”

Indeed, Senate Republican Leader Mitch McConnell told MSNBC’s Chuck Todd and Savannah Guthrie yesterday, “I did find [President Obama’s] suggestion on spending reductions completely inadequate.” He suggested, “We need to get back the 2008 level; that's a significant whack out of our annual discretionary spending. . . . “That is a significant reduction.”

Leader McConnell also previously  addressed the overall debt problem saying, “[I]f we’re going to make any real progress in the areas of spending, debt, and reining in government, the President will have to acknowledge that the policies of the past two years are not only largely to blame for the situation we find ourselves in, but that unless we do something to reverse their ill-effects, the road to recovery and prosperity will be a bumpy one.”

---

Tags: Washington, D.C., US House, US Senate, CPO, deficit, spending, stop spending, Presidential Election Campaign fund, Fannie Mae and Freddie Mac To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!