[KEVIN] ECKSTROM: Right, and it’s biblical language on both sides. The more traditional churches, Catholic bishops and your mainline churches and your Jewish groups are saying, you know, we have a biblical and ethical, moral obligation to care for people who can’t help themselves. On the other side, from the more conservative side, especially from the Tea Party, you have arguments saying that it’s actually immoral to leave debt to future generations. And they sometimes chafe at the notion of, you know, what would Jesus cut? They say, well, Jesus didn’t have opinions on this, you know, that it’s up to us to sort of make the decisions on what to cut. But you get various moral arguments from both sides, and we’re just waiting to see who wins the day.

{KIM] LAWTON: Well, I was at the National Religious Broadcasters Convention this week, and one of their keynote speakers was House Speaker John Boehner, Catholic, who used a lot of biblical language in his speech. He had a very receptive, mostly evangelical audience, and he quoted Scripture. He quoted from Proverbs, “A good man leaves behind an inheritance to his children’s children,” and he said Republicans want to not just be hearers of the word, but doers of the word, another scriptural reference there. And, you know, I found that very interesting, that you had the congressional leadership on the right also trying to seize the biblical and moral language on all of this.

Read or watch it all.

The greenback…is not just America’s currency. It’s the world’s.

But as astonishing as that is, what may be even more astonishing is this: The dollar’s reign is coming to an end.

I believe that over the next 10 years, we’re going to see a profound shift toward a world in which several currencies compete for dominance.

The impact of such a shift will be equally profound, with implications for, among other things, the stability of exchange rates, the stability of financial markets, the ease with which the U.S. will be able to finance budget and current-account deficits, and whether the Fed can follow a policy of benign neglect toward the dollar.

Read it all.

I was talking the other day with a new member of the U.S. Senate, and conversation turned to what had surprised him most in his first months on Capitol Hill. He said it was the number of people who still don’t seem to understand that we’re in crisis, that if we don’t move now on spending, it could do us in.

I’m always surprised when I hear this, yet I’ve heard it a lot. “There’s no sense of urgency up here.”

[Why is This?]

I think some of the answer has to do with what, for lack of a better word, I’ll call crisis-ism. This is a condition in which you don’t know you’re in crisis because you’re always in crisis, you’ve always been in crisis, and you’ve always gotten through, so what the heck. Crisis-ism is the inability to apprehend that this time it’s different, that this time the crisis is an actual crisis….

Read it all.

Americans have no idea where the federal government spends its money, a new poll suggests.

Among likely voters surveyed late last month by the Tarrance Group, “[t]here are widespread misperceptions about the state of the federal budget,” the Republican pollsters concluded. Sixty-three percent of those surveyed said they believe the federal government spends more on defense and foreign aid than it does on Medicare and Social Security. In fiscal 2010, spending for those two social programs totaled more than $1.1 trillion, while the Pentagon’s budget was about $660 billion and the State Department’s total spending was just under $52 billion.

A majority of those surveyed by Tarrance also have “incorrect” views on how to cut the federal deficit, with 60 percent saying the federal budget’s problems can be ameliorated by eliminating waste, fraud and abuse. The Government Accountability Office on Tuesday released a report detailing several billion dollars’ worth of “duplication” in government spending that could be cut. But even if the totals reach the tens of billions of dollars, they would still be a drop in the bucket of President Barack Obama’s proposed $3.73 trillion in spending for fiscal 2012.

Read it all.

The federal government isn’t simply bleeding money. Because of its addiction to red ink, it’s bleeding power, which is starting to flow away from the nation’s capital and out to the states. This is the little-recognized reality behind the remarkable political upheaval being seen in state capitals.

Republican governors such as Wisconsin’s Scott Walker, New Jersey’s Chris Christie and Indiana’s Mitch Daniels are pursuing their own controversial fiscal policies out of what they consider financial necessity; they have budgets to balance, and little time and few options to do the job. But governors of both parties also have less reason to wait and hope for help from a federal government that, with overwhelming budget deficits, is losing its ability to offer financial goodies to the states.

For decades, the implicit deal between Washington and state capitals has been that the feds would offer chunks of cash, and in return would get commensurate influence over the states’ social policies. Now that flow of federal goodies has begun what figures to be a long-term decline, as the money Washington has available to pass around to the states is squeezed.

Read it all.

The president is right ”” if America is to be competitive in this new knowledge-based global economy, we must invest in education, infrastructure and high-value-added research in a fiscally responsible manner.

But House Republicans are also right ”” spending is out of control, and there is no way possible to address our burgeoning debt without real spending cuts. That means finding ways to make government perform more efficiently, while scaling back or even eliminating certain government functions altogether.

Yet by focusing primarily on domestic discretionary spending, neither plan goes at all far enough to deal with our medium- or long-term fiscal challenges.

With the Fiscal Commission, we spent 10 months closely studying the cold, hard facts. Together, we came to the unavoidable conclusions that the problem is real, the solution will be painful, there is no easy way out and everything must be on the table.

Read it all (emphasis mine).

John Boyd writes:

The leaders of both political parties have come to embrace the philosophy of the common box turtle. They believe the key to success is to refuse to “go first” and never “lead with your chin.” They are convinced the loser will be the one who is forced to propose solutions to the problems they were elected to solve. This behavior is not acceptable.

We expect our leaders to analyze the pressing issues of the day based on the best information available and then to reach a consensus concerning the best course of action.

Read the rest of his letter and the others also.

Get ready for more undernourished infants, dangerously cold homes and disease-stricken communities in developing countries if proposed federal budget cuts become law.

That’s the message coming from left-leaning religious advocacy groups, who’ve been rallying supporters and blanketing Capitol Hill since budget debates kicked into high gear last week (Feb. 14-18). Declaring budgets to be “moral documents,” they’re prodding lawmakers to honor their respective faith traditions by sparing poverty-related programs from the cost-cutting axe.

But efforts to save funding are meeting resistance””not only from number crunchers, but also from others with different views of what constitutes moral budgeting.

Read it all.

One of Senator Edward M. Kennedy’s legacies in the new health care law, intended to allow the chronically ill and people with disabilities to continue living in their homes, is too costly to survive without major changes, Obama administration officials now say.

Republican lawmakers, who have vowed to repeal the health care law, cite the administration’s acknowledgment as yet another reason to do so. But the health and human services secretary, Kathleen Sebelius, says the law gives her plenty of authority to make the necessary changes to the program without Congressional action.

To make the program viable, Ms. Sebelius said, she is considering changes in the eligibility criteria, including employment and earnings requirements, to ensure that only active workers may enroll. She also said she favored adjusting premiums to rise with inflation.

Read it all.

President Obama’s budget director, Jacob Lew, said as much last week during his briefing on the president’s budget. Obama wants to find ways to “work together to find a solution to the long-term issues in Social Security,” Lew told reporters, but the program “does not contribute to the deficit in the short term.”

That would be nice if it were true. It’s not.

Social Security is a cash-in/cash-out program. It went into the red last year, when payroll tax revenue came up about $37 billion short of the benefits paid to retirees. Initially, that shortfall seemed a temporary consequence of the recession. But new projections from the Congressional Budget Office show that factors such as the payroll tax cut Obama and congressional Republicans agreed to last year mean that Social Security will instead come up short every year from now on ”” at least $45 billion this year, and a staggering half a trillion dollars over the next decade.

Read it all.

Many economists warn that the government’s huge national debt is a looming threat to long-term prosperity. But is it also immoral?
According to a growing number of conservative Christians, the answer is a resounding “Yes.”

As Washington debates President Obama’s proposed 2012 budget, the morality of the deficit has become the hot topic on right-leaning Christian blogs, radio programs and political mailings.

The concern is not only that the estimated $14.13 trillion debt could cripple the economy, some conservative Christian leaders say, but also that borrowing so much money violates important biblical tenets.

Read it all.

Let’s indulge Mr Obama in his fantasy economics: imagine that he does reduce the deficit to 3.1%. Supposedly, that would stabilise government debt: but it would do so at a dangerously high level of around 80% of GDP, and as interest rates rise the target will become much harder to hit. And that is before you consider the biggest problem of all: as more and more baby-boomers retire (the first started to do so this year), their demands for pensions and government-provided health care will start to push the deficit sharply up again after that.

Indeed, the real problem with both Mr Obama’s budget and the Republicans’ proposals is not so much the half-truths and fibs within them, as all the things they both left out. America needs to simplify its tax system and (slightly) increase its overall tax take. It needs to rein in its defence spending, which is currently equivalent to that of the next 20 countries combined. And it needs to tackle the gathering surge in entitlement costs. All these recommendations were made by the deficit-reduction commission that Mr Obama himself set up, but his budget conspicuously fails to take up any of them. Other debt-burdened Western countries have embarked on a stringent diet. America continues to gorge.

Read it all.

When Congress takes up President Obama’s fiscal 2012 budget, the debate will center on just a fraction of the overall $3.7 trillion budget: his proposals on spending and how to pay for them.

Not counting what the government spends on national security and social safety-net programs such as Medicare and Social Security, spending on other domestic programs accounts for just 12% of the overall budget.

Read it all.

I wonder if Mr. Obama is at all embarrassed by the 2012 budget. Like his previous two budgets, this one breaks all those “Morning in America” campaign promises of a “new” Washington.

The 2012 budget also is a repudiation of the findings of his very own bipartisan deficit commission.

The Bowles-Simpson commission had plenty of sensible recommendations, like cutting funds for the Corporation of Public Broadcasting, eliminating the Office of Safe and Drug-Free Schools and raising the qualifying age for Social Security.

But you’ll find precious little of this in the 2012 budget. At the White House, political sense apparently matters a lot more than common sense.

Read it all.

States that have borrowed billions of dollars from the federal government to cover the soaring cost of unemployment benefits would get immediate relief from the Obama administration under a plan to suspend interest payments for the next two years.

The proposal, which will be included in the budget request President Obama will send to Congress next week, would allow states to avoid raising taxes on employers to cover the payments – which are projected to total $3.6 billion through 2012, according to independent estimates.

Read it all.

Social Security’s finances are getting worse as the economy struggles to recover and millions of baby boomers stand at the brink of retirement.

New congressional projections show Social Security running deficits every year until its trust funds are eventually drained in about 2037.

This year alone, Social Security is projected to collect $45 billion less in payroll taxes than it pays out in retirement, disability and survivor benefits, the nonpartisan Congressional Budget Office said Wednesday….

Read it all.

Now that bipartisan commission has reported, but Mr. Obama didn’t fully endorse any of its recommendations. To the contrary, he promised more jobs for teachers and construction workers. He warned against “slashing” Social Security benefits. Corporate tax reform is fine, but if it’s revenue-neutral, it only postpones – and makes more politically difficult – the task of narrowing the nation’s deficit.

So what happens now? Maybe some members of Congress will display the courage the president has lacked. Maybe Mr. Obama, in the budget he proposes next month, will grapple more realistically with the hard choices than he did Tuesday night. But even if he does, how can he expect public support if he hasn’t made the case? From the man who promised to change Washington, it seemed all too drearily familiar.

Read it all.

We must never forget that the things we’ve struggled for, and fought for, live in the hearts of people everywhere. And we must always remember that the Americans who have borne the greatest burden in this struggle are the men and women who serve our country. (Applause.)

Tonight, let us speak with one voice in reaffirming that our nation is united in support of our troops and their families. Let us serve them as well as they’ve served us — by giving them the equipment they need, by providing them with the care and benefits that they have earned, and by enlisting our veterans in the great task of building our own nation.

Our troops come from every corner of this country — they’re black, white, Latino, Asian, Native American. They are Christian and Hindu, Jewish and Muslim. And, yes, we know that some of them are gay. Starting this year, no American will be forbidden from serving the country they love because of who they love. (Applause.) And with that change, I call on all our college campuses to open their doors to our military recruiters and ROTC. It is time to leave behind the divisive battles of the past. It is time to move forward as one nation. (Applause.)

We should have no illusions about the work ahead of us. Reforming our schools, changing the way we use energy, reducing our deficit — none of this will be easy. All of it will take time. And it will be harder because we will argue about everything….

Read it all.

Parents of the profoundly disabled are profoundly troubled.

Beginning April 1, Medicaid will cover a total of 75 occupational, physical and speech therapy sessions annually. The health insurance program for the poor and disabled now covers a combined 225 of those therapies a year.

The reductions will be retroactive to July 2010, meaning some families already will have reached their yearly maximum before the cuts officially take effect.

Read it all.

Policy makers are working behind the scenes to come up with a way to let states declare bankruptcy and get out from under crushing debts, including the pensions they have promised to retired public workers.

Unlike cities, the states are barred from seeking protection in federal bankruptcy court. Any effort to change that status would have to clear high constitutional hurdles because the states are considered sovereign.

But proponents say some states are so burdened that the only feasible way out may be bankruptcy, giving Illinois, for example, the opportunity to do what General Motors did with the federal government’s aid.

Read it all.

We have come to believe a story about the deficit that is largely not true.

It’s a comforting story, to be sure. It holds the promise of a painless solution, because it suggests that the country’s huge looming deficits are not really our fault. Instead, they seem to stem from weak-willed politicians, wasteful government programs that do not benefit us and tax avoidance by people we have never met.

In truth, the coming deficits are a result, above all, of the fact that most Americans are scheduled to receive far more in Medicare benefits than they have paid in Medicare taxes. Conservative and liberal economists agree on this point. After Medicare on the list of big, growing budget items come Social Security and the military.

Read it all.

Two leading credit rating agencies on Thursday cautioned the U.S. on its credit rating, expressing concern over a deteriorating fiscal situation that they say needs correction.

Moody’s Investors Service said in a report Thursday that the U.S. will need to reverse an upward trajectory in the debt ratios to support its triple-A rating.

“We have become increasingly clear about the fact that if there are not offsetting measures to reverse the deterioration in negative fundamentals in the U.S., the likelihood of a negative outlook over the next two years will increase,” said Sarah Carlson, senior analyst at Moody’s.

Read it all.

Advocates for diabetes patients are voicing concerns that Medicaid cuts taking effect in February will reverse gains South Carolina has made over the past decade in managing diabetics’ health.

Doctors have treated diabetes aggressively in recent years, but cuts in the number of drugs Medicaid covers — reductions state health officials called difficult but necessary — might compromise that focus, they said.

The number of diagnosed cases of adult-onset diabetes has risen dramatically, but the rate of lower- extremity amputations has decreased, according to preliminary findings from the annual report of the Diabetes Initiative of South Carolina.

Read it all.

JEFFREY BROWN: So it is the end of the year, so we’re allowed…to think big, not just the week.

What defines — what defines this year in politics?

MICHAEL GERSON: I don’t know. I — I think it was a year of impatience….

JEFFREY BROWN: E.J. The year?

E.J. DIONNE, The Washington Post: You know, I think the great political scientist, Bono, explained the last three elections — they still haven’t found what they’re looking for….

Read or watch it all.

Consider an average-wage, two-earner couple together earning $89,000 a year. Upon retiring in 2011, they would have paid $114,000 in Medicare payroll taxes during their careers.

But they can expect to receive medical services – from prescriptions to hospital care – worth $355,000, or about three times what they put in.

The estimates by economists Eugene Steuerle and Stephanie Rennane of the Urban Institute think tank illustrate the huge disconnect between widely-held perceptions and the numbers behind Medicare’s shaky financing. Although Americans are worried about Medicare’s long-term solvency, few realize the size of the gap.

“The fact that you put money into the system doesn’t mean it’s there waiting for you to collect,” said Steuerle.

Read it all.

Baby Boomers are about to create a record population explosion in the nation’s health care program for seniors.

Starting on Saturday, Baby Boomers begin turning 65 and qualifying for Medicare ”” one every eight seconds. A record 2.8 million will qualify in 2011, rising to 4.2 million a year by 2030, projections show.

In all, the government expects 76 million Boomers will age on to Medicare. Even factoring in deaths over that period, the program will grow from 47 million today to 80 million in 2030.

Read it all.

As a society, we’ve recoiled from a candid discussion of public and private responsibilities for retirement. The long-ducked question is how much government should subsidize Americans for the last 20 to 30 years of their lives. Social Security and Medicare have evolved from an old-age safety net into a “middle-age retirement system,” as Eugene Steuerle of the Urban Institute puts it. In 1940, couples reaching 65 lived an average of almost 19 years, Steuerle notes. Now, the comparable figure for couples is 25 years. For Americans born today, the estimate approaches 30 years.

Overhauling Social Security and Medicare has many purposes: to extend people’s working lives; to make them pay more of the costs of their own retirement, as opposed to relying on subsidies from younger Americans; to prevent spending on old-age welfare from crippling other government programs or the economy; to create a bigger constituency for cost control in health care. America’s leaders have tiptoed around these issues, talking blandly about limiting “entitlements” or making proposals of such complexity that only a few “experts” understand.

Just because this is an awful time to discuss these questions does not mean they shouldn’t be discussed. The longer we wait, the more acute our fairness dilemma grows. We can’t deal with it unless public opinion is engaged and changed, but public opinion won’t be engaged and changed unless political leaders discard their self-serving hypocrisies. The old deserve dignity, but the young deserve hope. The passive acceptance of the status quo is the path of least resistance – and a formula for national decline.

Read it all.

Sadder, wiser, those of us gathered on the Washington Mall in the freezing morn of Mr Obama’s inauguration can see now that of all the brave, unsustainable hopes uttered by the new young president, the most unsustainable of all turned out to be his Biblical plea to “put away childish things”. He might as well have tried to legislate the word “dream” out of American public discourse. Dreams? Reality? It’s not even close, is it?

Whether fantasy will prevail over factuality, adolescent wishful thinking over maturity, will be the great political motif of the next few years. The omens are not auspicious….

Read it all.

Senate Democrats have filed a $1.1 trillion omnibus spending bill that would fund the government through fiscal year 2011, according to Senate GOP sources.

The 1,924-page bill includes funding to implement the sweeping healthcare reform bill Congress passed earlier this year as well as additional funds for Internal Revenue Service agents, according to a senior GOP aide familiar with the legislation.

Read it all.

President Obama and congressional Republicans agreed Monday to a tentative deal that would extend for two years all the Bush-era income tax breaks set to expire on Dec. 31, continue unemployment benefits for an additional 13 months and cut payroll taxes for workers to encourage employers to start hiring.

The deal has been in the works for more than a week and represents a concession by Obama to political reality: Democrats don’t have the votes in Congress to extend only the expiring income tax breaks that benefit the middle class. The White House estimates that the proposed agreement would prevent typical families from facing annual tax increases of about $3,000, starting Jan. 1.

Read it all.