Here are the most recent figures related to the size our our National Debt, per www.treasurydirect.gov
As of Feb. 14, 2008 (Happy Valentine's Day):
Publicly Held: $5,195,943,354,136.82
Intragovernmental holdings: $4,095,955,735,115.73
Total: $9,291,899,089,252.55
Interest payments for FY08:
October 2007 - $22,310,362,733.54
November 2007 - $25,344,987,578.31
December 2007 -$106,138,177,851.45
January 2008 - $24,686,746,422.35
FY08 to date: $178,480,274,585.65
Public Contributions:
December 2007: $113,092.26
FY08 to date: $330,616.89
FY07 totals: $2,624,862.42
Per the IRS, Gifts to reduce the Public Debt ARE tax deductible for income tax purposes. For more information, see www.irs.gov
Saturday, February 16, 2008
Friday, February 15, 2008
Dave's Thoughts on the Stimulus Tax Rebate
Dave's Thoughts on the Stimulus Tax Rebate
by Dave Ramsey
www.daveramsey.com
Most of you are jumping with joy that you're probably going to be getting a big, fat check from the government. You may be thinking, "FREE MONEY, BABY!!!"
Well, I'm not here to totally rain on your parade, but plain and simple, I'm not lovin' this plan. This government plan to try to stimulate the economy and pull us away from a possible recession is actually straight-up socialism - just the opposite of capitalism! I don't want my money to help you (if you haven't paid federal income taxes) buy an iPhone or whatever else you have your eye set on.
"Letting Americans keep more of their own money should increase consumer spending, and lift our economy at a time when people otherwise might spend less," President Bush said. The idea in theory sounds like it will work smoothly, but I have a much better idea that will eventually increase consumer spending, and in turn, cause the economy to flourish: encourage freedom from debt!
The last time a stimulus rebate like this was issued was in 2001. A recent study revealed consumers spent two-thirds of those rebates within 6 months of receiving them. Do you have a game plan already for what you'll do with your rebate this time around?
Make the Money Work For You
Don't wait until it comes in the mail to formulate a plan, and whatever you do, do NOT spend this money before it gets to your hands! Those are just formal invitations for Murphy to unpack his suitcases in your spare bedroom! Here are a handful of ways I recommend making your tax rebate work for you, depending on where you are in the Baby Steps:
Pay off debt. This may sound like a no-brainer, but I already expect that few people will actually do it! There's really no reason NOT to throw this "free" money toward your debt snowball. It will get you one step (or maybe quite a few) closer to being debt free, and THEN you will have the freedom to buy that toy or take that vacation you've had your heart set on for quite a while! Learn how
Invest it. If you put this big chunk of change into a mutual fund for a few years, you'll actually receive TONS more money than just the initial $600 or $1,200 check this summer.
Say you get back $600 and put it automatically into a mutual fund averaging 12%. In 2018, that one-time investment will grow to approximately $2,000! If left in for 20 years, it will be worth about $6,500! For the married folks, this free money can grow up to $13,000 over 20 years - WOW! Calculate your earnings!
Have some fun. I'm not a total meanie. I actually do like to have some fun with my money, and I encourage you to do the same! There's nothing wrong with taking your spouse out for a nice dinner or buying that new pair of jeans with some of this money you could be getting. Just stick within your boundaries, and remember that the quicker you get out of debt, the more fun things you can do and the more money you can give away to bless others.
Source: CNNMoney.com
by Dave Ramsey
www.daveramsey.com
Most of you are jumping with joy that you're probably going to be getting a big, fat check from the government. You may be thinking, "FREE MONEY, BABY!!!"
Well, I'm not here to totally rain on your parade, but plain and simple, I'm not lovin' this plan. This government plan to try to stimulate the economy and pull us away from a possible recession is actually straight-up socialism - just the opposite of capitalism! I don't want my money to help you (if you haven't paid federal income taxes) buy an iPhone or whatever else you have your eye set on.
"Letting Americans keep more of their own money should increase consumer spending, and lift our economy at a time when people otherwise might spend less," President Bush said. The idea in theory sounds like it will work smoothly, but I have a much better idea that will eventually increase consumer spending, and in turn, cause the economy to flourish: encourage freedom from debt!
The last time a stimulus rebate like this was issued was in 2001. A recent study revealed consumers spent two-thirds of those rebates within 6 months of receiving them. Do you have a game plan already for what you'll do with your rebate this time around?
Make the Money Work For You
Don't wait until it comes in the mail to formulate a plan, and whatever you do, do NOT spend this money before it gets to your hands! Those are just formal invitations for Murphy to unpack his suitcases in your spare bedroom! Here are a handful of ways I recommend making your tax rebate work for you, depending on where you are in the Baby Steps:
Pay off debt. This may sound like a no-brainer, but I already expect that few people will actually do it! There's really no reason NOT to throw this "free" money toward your debt snowball. It will get you one step (or maybe quite a few) closer to being debt free, and THEN you will have the freedom to buy that toy or take that vacation you've had your heart set on for quite a while! Learn how
Invest it. If you put this big chunk of change into a mutual fund for a few years, you'll actually receive TONS more money than just the initial $600 or $1,200 check this summer.
Say you get back $600 and put it automatically into a mutual fund averaging 12%. In 2018, that one-time investment will grow to approximately $2,000! If left in for 20 years, it will be worth about $6,500! For the married folks, this free money can grow up to $13,000 over 20 years - WOW! Calculate your earnings!
Have some fun. I'm not a total meanie. I actually do like to have some fun with my money, and I encourage you to do the same! There's nothing wrong with taking your spouse out for a nice dinner or buying that new pair of jeans with some of this money you could be getting. Just stick within your boundaries, and remember that the quicker you get out of debt, the more fun things you can do and the more money you can give away to bless others.
Source: CNNMoney.com
Wednesday, January 23, 2008
CBO Sees $250 Billion Deficit
CBO Sees $250 Billion Deficit
Associated Press Wednesday January 23, 10:33 am ET
By Andrew Taylor, Associated Press Writer
CBO Predicts Rising Federal Budget Deficit As Economy Weakens
WASHINGTON (AP) -- The deficit for the current budget year will jump to about $250 billion, the Congressional Budget Office estimated Wednesday, citing the weakening economy. And that figure does not reflect at least $100 billion in red ink from an economic stimulus measure in the works.
"After three years of declining budget deficits, a slowing economy this year will contribute to an increase in the deficit," the CBO report said.
The figure greatly exceeds the $163 billion in red ink registered last year. Adding likely but still unapproved outlays for the wars in Iraq and Afghanistan brings its "baseline" deficit estimate of $219 billion to about $250 billion, the nonpartisan CBO said.
Senate Budget Committee Chairman Kent Conrad, D-N.D., said the 2008 deficit would reach more than $350 billion once the costs of an upcoming economic stimulus measure under negotiation between the Bush administration and Congress are factored in.
The CBO crunches economic and budget data for lawmakers.
Unlike an increasing number of economists, CBO does not forecast a recession this year. It instead forecasts a growth rate of 1.7 percent, down from 2.2 percent real growth in the gross domestic product (GDP) last year.
"Although recent data suggest that the probability of a recession in 2008 has increased, CBO does not expect the slowdown in economic growth to be large enough to register as a recession," CBO said. The CBO economic forecast was completed last month, before a recent spike in unemployment and the release of disappointing holiday retail sales figures.
"A number of ominous economic signs have emerged since CBO finalized last month the forecast underlying today's report," said House Budget Committee Chairman John Spratt Jr., D-S.C. "Today's new economic forecast thus adds to the growing evidence that the economy has weakened, and that policymakers in Washington must take action."
CBO Director Peter Orszag testified before the House Budget Committee. He warned them again that regardless of the short-term fluctuations in the deficit, the longer-term picture remains bleak due to expected spiraling costs of Medicare, Medicaid and Social Security as the Baby Boom generation retires.
"A substantial reduction in the growth of spending, a significant increase in tax revenues relative to the size of the economy, or some combination of the two will be necessary to maintain the nation's long-term fiscal stability," Orszag said.
Officially, CBO predicts the 2008 deficit at $219 billion, but that figure fails to account for at least an additional $30 billion in war costs and the likely infusion of deficit-financed economic stimulus measures such as income tax rebates, business tax breaks and help for the unemployed now under discussion on Capitol Hill and at the White House.
The deficit seems to be an afterthought as lawmakers race toward agreement with President Bush on a plan to pump perhaps $150 billion worth of deficit spending into the economy. The bulk of the plan would come as tax cuts, though Democrats are pressing for additional help for the unemployed and people on food stamps. Constituency groups in both political parties are pressing for even more, such as Democratic-sought aid to cash-strapped states and people with high heating bills.
Most of any economic stimulus bill would be released before the Oct. 1 start of the 2009 budget year, with any benefits to the economy -- and therefore federal revenues -- lagging behind.
The White House is set to release its 2009 budget on Feb. 4, and Bush has promised a plan that would erase the deficit by 2012 if his policies are followed.
The 2006 deficit was $248 billion and had closed from a high of $413 billion registered in 2004.
The deficit picture remains worse than it was when Bush took office seven years ago. Then, both White House and congressional forecasters projected cumulative surpluses of $5.6 trillion over the subsequent decade.
But a revenue bubble burst, a recession and the Sept. 11, 2001, terrorist attacks adversely affected the books. Several rounds of tax cuts, including Bush's signature $1.35 trillion 2001 tax cut, also contributed to the return to deficits in 2002 after four years of budget surpluses. The national debt has risen to $9.2 trillion.
"This guy will come close to doubling the debt of the country during his period of presidency," Conrad said.
Congressional Budget Office: http://www.cbo.gov
Associated Press Wednesday January 23, 10:33 am ET
By Andrew Taylor, Associated Press Writer
CBO Predicts Rising Federal Budget Deficit As Economy Weakens
WASHINGTON (AP) -- The deficit for the current budget year will jump to about $250 billion, the Congressional Budget Office estimated Wednesday, citing the weakening economy. And that figure does not reflect at least $100 billion in red ink from an economic stimulus measure in the works.
"After three years of declining budget deficits, a slowing economy this year will contribute to an increase in the deficit," the CBO report said.
The figure greatly exceeds the $163 billion in red ink registered last year. Adding likely but still unapproved outlays for the wars in Iraq and Afghanistan brings its "baseline" deficit estimate of $219 billion to about $250 billion, the nonpartisan CBO said.
Senate Budget Committee Chairman Kent Conrad, D-N.D., said the 2008 deficit would reach more than $350 billion once the costs of an upcoming economic stimulus measure under negotiation between the Bush administration and Congress are factored in.
The CBO crunches economic and budget data for lawmakers.
Unlike an increasing number of economists, CBO does not forecast a recession this year. It instead forecasts a growth rate of 1.7 percent, down from 2.2 percent real growth in the gross domestic product (GDP) last year.
"Although recent data suggest that the probability of a recession in 2008 has increased, CBO does not expect the slowdown in economic growth to be large enough to register as a recession," CBO said. The CBO economic forecast was completed last month, before a recent spike in unemployment and the release of disappointing holiday retail sales figures.
"A number of ominous economic signs have emerged since CBO finalized last month the forecast underlying today's report," said House Budget Committee Chairman John Spratt Jr., D-S.C. "Today's new economic forecast thus adds to the growing evidence that the economy has weakened, and that policymakers in Washington must take action."
CBO Director Peter Orszag testified before the House Budget Committee. He warned them again that regardless of the short-term fluctuations in the deficit, the longer-term picture remains bleak due to expected spiraling costs of Medicare, Medicaid and Social Security as the Baby Boom generation retires.
"A substantial reduction in the growth of spending, a significant increase in tax revenues relative to the size of the economy, or some combination of the two will be necessary to maintain the nation's long-term fiscal stability," Orszag said.
Officially, CBO predicts the 2008 deficit at $219 billion, but that figure fails to account for at least an additional $30 billion in war costs and the likely infusion of deficit-financed economic stimulus measures such as income tax rebates, business tax breaks and help for the unemployed now under discussion on Capitol Hill and at the White House.
The deficit seems to be an afterthought as lawmakers race toward agreement with President Bush on a plan to pump perhaps $150 billion worth of deficit spending into the economy. The bulk of the plan would come as tax cuts, though Democrats are pressing for additional help for the unemployed and people on food stamps. Constituency groups in both political parties are pressing for even more, such as Democratic-sought aid to cash-strapped states and people with high heating bills.
Most of any economic stimulus bill would be released before the Oct. 1 start of the 2009 budget year, with any benefits to the economy -- and therefore federal revenues -- lagging behind.
The White House is set to release its 2009 budget on Feb. 4, and Bush has promised a plan that would erase the deficit by 2012 if his policies are followed.
The 2006 deficit was $248 billion and had closed from a high of $413 billion registered in 2004.
The deficit picture remains worse than it was when Bush took office seven years ago. Then, both White House and congressional forecasters projected cumulative surpluses of $5.6 trillion over the subsequent decade.
But a revenue bubble burst, a recession and the Sept. 11, 2001, terrorist attacks adversely affected the books. Several rounds of tax cuts, including Bush's signature $1.35 trillion 2001 tax cut, also contributed to the return to deficits in 2002 after four years of budget surpluses. The national debt has risen to $9.2 trillion.
"This guy will come close to doubling the debt of the country during his period of presidency," Conrad said.
Congressional Budget Office: http://www.cbo.gov
Friday, January 11, 2008
Fidelity: Debt crowds job-based savings
The following appeared in the January 11, 2008 issue of the St. Paul Pioneer Press business section, page 2C.
Fidelity: Debt crowds job-based savings
High consumer debt is slowing growth in retirement savings accounts, according to a study released Thursday by Fidelity Investments. The mutual fund company, which is based in Boston, found one in three employees of nonprofit organizations increased their contributions to job-based savings plans in 2007. Some 44 percent of participants in the survey also admitted to personal debt exceeding $5,000, not including mortgages, the study found. The impact of debt could be seen in the breakdown of savings by people who considered themselves investors, savers or spenders. The spenders tended to carry higher debt than people in the other categories. Some 42 percent of people who considered themselves investors raised their contributions in 2007, compared with 30 percent of savers and 25 percent of spenders, the study found.
Tuesday, January 8, 2008
Happy New Year
It's pretty sad when one has to celebrate for NOT hitting a milestone. I'm celebrating because we still haven't hit the $10 Trillion National Debt level. Sadly, the way things are going, I'm sure we'll hit it by the end of the year.
Since I've been out of town and have had computer problems, I haven't been able to post for the past two months. Needless to say, despite my inability to monitor our debt for the past two months, it kept creeping up.
Here are the latest statistics from TreasuryDirect.com pertaining to the National Debt (effective Jan. 4, 2008).
Debt Held by Public: $5,116,199,834,200.04
Intragovernmental: $4,081,378,046,617.39
Total Debt (4 Jan): $9,197,577,880,817.43
Interest Payments FY08:
October 2007 - $22,310,362,733.54
November 2007 - $25,344,987,578.31
December 2007 - $106,138,177,851.45
Total 1st Q: $153,793,528,163.30
Gifts to reduce the Public Debt:
November 2007 - $27,617.15
October 2007 - $189,907.48
FY08 to Date: $217,524.63
Gifts to reduce the Public Debt in FY 2007: $2,624,862.42
Now that we are into the Presidential Primary season, it would be nice if the politicians who want to be our next leader would finally address this key issue. The silence is deafening!!
Since I've been out of town and have had computer problems, I haven't been able to post for the past two months. Needless to say, despite my inability to monitor our debt for the past two months, it kept creeping up.
Here are the latest statistics from TreasuryDirect.com pertaining to the National Debt (effective Jan. 4, 2008).
Debt Held by Public: $5,116,199,834,200.04
Intragovernmental: $4,081,378,046,617.39
Total Debt (4 Jan): $9,197,577,880,817.43
Interest Payments FY08:
October 2007 - $22,310,362,733.54
November 2007 - $25,344,987,578.31
December 2007 - $106,138,177,851.45
Total 1st Q: $153,793,528,163.30
Gifts to reduce the Public Debt:
November 2007 - $27,617.15
October 2007 - $189,907.48
FY08 to Date: $217,524.63
Gifts to reduce the Public Debt in FY 2007: $2,624,862.42
Now that we are into the Presidential Primary season, it would be nice if the politicians who want to be our next leader would finally address this key issue. The silence is deafening!!
Thursday, November 8, 2007
New Debt Stats Now Available At TreasuryDirect.gov
Been a busy few weeks with work, campaigns and helping friends move. Yet the Debt continues to grow in my absence.
Here are the figures for the Month of October 2007 courtesy of the U.S. Treasury at TreasuryDirect.gov
Debt Held By The Public (Nov. 7, 2007): $5,082,087,499,065.19
Intragovernmental Holdings (Nov. 7, 2007): $4,002,186,282,492.45
Total National Debt (Nov. 7, 2007): $9,084,273,781,557.64
Gifts to Reduce Public Debt Held By Public (Sept. 2007) $27,460.42
Total Gifts for FY 2007: $2,624,862.42
Interest Payment - October 2007: $22,310,362,733.54
Since October 2007 is the first month in FY 2008, the October amount reflects the cumulative total for the Fiscal Year.
Here are the figures for the Month of October 2007 courtesy of the U.S. Treasury at TreasuryDirect.gov
Debt Held By The Public (Nov. 7, 2007): $5,082,087,499,065.19
Intragovernmental Holdings (Nov. 7, 2007): $4,002,186,282,492.45
Total National Debt (Nov. 7, 2007): $9,084,273,781,557.64
Gifts to Reduce Public Debt Held By Public (Sept. 2007) $27,460.42
Total Gifts for FY 2007: $2,624,862.42
Interest Payment - October 2007: $22,310,362,733.54
Since October 2007 is the first month in FY 2008, the October amount reflects the cumulative total for the Fiscal Year.
Monday, October 15, 2007
Newest Debt figures released
I'm about a week behind the times, but the October monthly statement of the National Debt has been released. Here is a summary:
National Debt Total as of 10/12/2007:
$9,044,256,689,740.39
Of that, the debt held by the public comes to: $5,038,254,667,984.29
and Intragovernmental holdings (trust funds) are: $4,006,002,021,756.10
In September, taxpayers paid $19,186,822,742.64 in interest on our National Debt (19 billion is roughly three quarters of the gap that Congress and the Administration are arguing over for the SCHIPS program funding increase).
During the 2007 fiscal year, taxpayers paid: $429,977,998,108.20 in interest. (Just shy of $430 billion - just think of what we could do with that money if we weren't paying interest - tax cuts anyone?)
For public contributions to reduce the national debt, $10,518.85 was donated to the Treasury Department in August 2007, with $2,597,402.00 given year-to-date. ($2 million donated to the Treasury with $19 billion in interest payments in one month.)
Next report will be out on the 4th business day of November.
These figures are available at Treasury Direct, www.treasurydirect.gov
National Debt Total as of 10/12/2007:
$9,044,256,689,740.39
Of that, the debt held by the public comes to: $5,038,254,667,984.29
and Intragovernmental holdings (trust funds) are: $4,006,002,021,756.10
In September, taxpayers paid $19,186,822,742.64 in interest on our National Debt (19 billion is roughly three quarters of the gap that Congress and the Administration are arguing over for the SCHIPS program funding increase).
During the 2007 fiscal year, taxpayers paid: $429,977,998,108.20 in interest. (Just shy of $430 billion - just think of what we could do with that money if we weren't paying interest - tax cuts anyone?)
For public contributions to reduce the national debt, $10,518.85 was donated to the Treasury Department in August 2007, with $2,597,402.00 given year-to-date. ($2 million donated to the Treasury with $19 billion in interest payments in one month.)
Next report will be out on the 4th business day of November.
These figures are available at Treasury Direct, www.treasurydirect.gov
AP - Deficit falls to lowest level in 5 years
The following article appeared on Oct. 11, 2007, courtesy of the Associated Press.
Deficit falls to lowest level in 5 years
Both spending, revenue at record marks in 2007
BY MARTIN CRUTSINGER
Associated Press
WASHINGTON - The Bush administration reported Thursday that the federal budget deficit fell to $162.8 billion in the just-completed budget year, the lowest amount of red ink in five years.
The administration credited the president's tax cuts for helping generate record-breaking revenues but warned of an approaching "fiscal train wreck" unless Congress deals with unsustainable growth in Social Security, Medicare and Medicaid.
President Bush, appearing with his economic team to trumpet the news, noted that the deficit turned out to be $81 billion lower than it was projected to be in February. He said the deficit represents 1.2 percent of gross domestic product - less than the average of the last 40 years.
"By keeping taxes low we can grow the economy, and by working with Congress to set priorities we can be fiscally responsible and we can head toward balance," Bush said after the meeting across the street from the White House. "And that's exactly where we're headed."
The deficit for the 2007 budget year that ended on Sept. 30 was 34.4 percent lower than the $248.2 billion deficit recorded in 2006, reflecting faster growth in revenues than in government spending.
Administration officials said the government was on track to accomplish Bush's goal of eliminating the deficit by 2012. But Democrats said the improvement in the deficit this year did not mask the fact that Bush's economic policies transformed the budget surpluses of the Clinton years into record deficits and an unprecedented increase in the national debt.
The debate over the president's signature tax cuts and their impact on the economy are certain to be played out in the coming presidential campaign. Republican candidates are vowing to make permanent Bush's tax cuts, which are due to expire at the end of 2010; Democrats want to roll back the tax cuts received by the wealthiest taxpayers.
Both revenues and spending climbed to record levels in 2007. Spending rose by 2.8 percent to $2.73 trillion while revenues rose by a faster 6.7 percent to a record $2.57 trillion, a gain the administration attributed to the economic stimulus from the president's tax cuts.
"This year's budget results further demonstrate how the president's tax relief, combined with spending discipline, has helped promote a sustained economic expansion, which led to revenue growth and resulted in a declining deficit," said White House budget director Jim Nussle.
But administration officials said while the short-term budget deficit was improving, greater efforts were needed to deal with the budgetary pressures that will arise in future years with the approaching retirement of 78 million baby boomers.
"For the sake of our children and grandchildren, Congress should begin to take action to prevent this fiscal train wreck," Nussle said in a statement accompanying the budget figures.
Senate Budget Committee Chairman Kent Conrad, D-N.D., said that Bush would "go down in history as the most fiscally irresponsible president ever. The fact is that the nation's debt has exploded on his watch - rising by $3 trillion since 2001, to $9 trillion today."
Bush recently signed into law a measure increasing the government's borrowing ceiling to $9.815 trillion. It was the fifth debt increase of Bush's presidency. The national debt is the accumulation of the annual deficits.
The deficit hit an all-time high in dollar terms of $413 billion in 2004 and has been coming down since.
The Congressional Budget Office projects the deficit will improve further in the 2008 budget year, which began on Oct. 1, projecting a decline to $155 billion before the imbalance starts to rise again in 2009.
Deficit falls to lowest level in 5 years
Both spending, revenue at record marks in 2007
BY MARTIN CRUTSINGER
Associated Press
WASHINGTON - The Bush administration reported Thursday that the federal budget deficit fell to $162.8 billion in the just-completed budget year, the lowest amount of red ink in five years.
The administration credited the president's tax cuts for helping generate record-breaking revenues but warned of an approaching "fiscal train wreck" unless Congress deals with unsustainable growth in Social Security, Medicare and Medicaid.
President Bush, appearing with his economic team to trumpet the news, noted that the deficit turned out to be $81 billion lower than it was projected to be in February. He said the deficit represents 1.2 percent of gross domestic product - less than the average of the last 40 years.
"By keeping taxes low we can grow the economy, and by working with Congress to set priorities we can be fiscally responsible and we can head toward balance," Bush said after the meeting across the street from the White House. "And that's exactly where we're headed."
The deficit for the 2007 budget year that ended on Sept. 30 was 34.4 percent lower than the $248.2 billion deficit recorded in 2006, reflecting faster growth in revenues than in government spending.
Administration officials said the government was on track to accomplish Bush's goal of eliminating the deficit by 2012. But Democrats said the improvement in the deficit this year did not mask the fact that Bush's economic policies transformed the budget surpluses of the Clinton years into record deficits and an unprecedented increase in the national debt.
The debate over the president's signature tax cuts and their impact on the economy are certain to be played out in the coming presidential campaign. Republican candidates are vowing to make permanent Bush's tax cuts, which are due to expire at the end of 2010; Democrats want to roll back the tax cuts received by the wealthiest taxpayers.
Both revenues and spending climbed to record levels in 2007. Spending rose by 2.8 percent to $2.73 trillion while revenues rose by a faster 6.7 percent to a record $2.57 trillion, a gain the administration attributed to the economic stimulus from the president's tax cuts.
"This year's budget results further demonstrate how the president's tax relief, combined with spending discipline, has helped promote a sustained economic expansion, which led to revenue growth and resulted in a declining deficit," said White House budget director Jim Nussle.
But administration officials said while the short-term budget deficit was improving, greater efforts were needed to deal with the budgetary pressures that will arise in future years with the approaching retirement of 78 million baby boomers.
"For the sake of our children and grandchildren, Congress should begin to take action to prevent this fiscal train wreck," Nussle said in a statement accompanying the budget figures.
Senate Budget Committee Chairman Kent Conrad, D-N.D., said that Bush would "go down in history as the most fiscally irresponsible president ever. The fact is that the nation's debt has exploded on his watch - rising by $3 trillion since 2001, to $9 trillion today."
Bush recently signed into law a measure increasing the government's borrowing ceiling to $9.815 trillion. It was the fifth debt increase of Bush's presidency. The national debt is the accumulation of the annual deficits.
The deficit hit an all-time high in dollar terms of $413 billion in 2004 and has been coming down since.
The Congressional Budget Office projects the deficit will improve further in the 2008 budget year, which began on Oct. 1, projecting a decline to $155 billion before the imbalance starts to rise again in 2009.
Saturday, October 6, 2007
WSJ: GOP Tax Dilemma
The following was sent to me by a good friend. In my opinion, the party's fiscal message should be the following: eliminate wasteful government spending, balance the federal budget each year and start paying off the National Debt. If the party and it's candidates adopt that approach, I think they'll find widespread support.
GOP Tax Dilemma
After years of waste in Congress, voters aren't buying the party's fiscal message.
BY STEPHEN MOORE
Friday, October 5, 2007 12:01 a.m. EDT - Wall Street Journal
A few weeks ago Republican leaders gathered on Capitol Hill to hear from their top pollsters and pundits about how they can win back the votes of independent voters. Some of the attendees are still in a state of cardiac arrest over what they learned.
America's swing voters, especially the suburban "security moms," who abandoned the GOP in droves in 2006 still hold Republicans in very low regard. What has party tacticians especially spooked is that these independents are apparently not much attracted to what the Republicans are saying about taxes. That's a bitter pill for party leaders to swallow, because for 25 years the anti-tax banner has been a political trump card for conservative candidates. A top strategist at the Republican National Committee who attended the meeting told me: "Our tax message has worn thin."
Well, that's not exactly true. It is true that the GOP message on taxes needs a makeover, perhaps a radical one--and the party's congressional leaders had better figure this out soon: The big tax fight starts as early as next week when House Ways and Means Committee Chairman Charlie Rangle unveils his multibillion dollar soak-the-rich tax hike plan to pay for middle-class Alternative Minimum Tax relief. So let's review some of the key attitudinal shifts of voters on taxes as revealed in recent polls and focus-group findings.
First, the not-so-good news for the GOP. Most voters are unpersuaded by the Republican message that the Bush tax cuts were a resounding success that pumped the economy back to life. Worse, the key independent voters are actually repelled by that message. "It crashes like the Hindenburg," says Richard Thau, who has been monitoring swing voter sentiments across the nation. Why? Because politicians who boast about the rosy economy seem out of touch, even delusional, given the rising costs of gasoline, health insurance and college tuition.
The reality, of course, is that the investment tax cuts did help create seven million jobs and did steer the economy out of recession. That doesn't matter to these "stressed out" voters, as Mr. Thau calls them. The Bush tax cuts are a bridge to the past, not the future, to borrow a Clintonite term. Moreover, because local property and school taxes have been skyrocketing, many independent voters scratch their heads and wonder: What tax cuts?
There is more deflating news. Unlike in the 1980s and '90s, voters are today less attracted to talk of new tax cuts, which they think are pie-in-the-sky, given the current war costs and budget-deficit. Nor are they averse to raising taxes on "the wealthy," a group they are persuaded is taking advantage of tax loopholes to avoid paying their fair share. That the richest 10% already pay two-thirds of the income taxes isn't well understood. One strong defense mechanism against the left's class warfare tax policy is that roughly half of voters are convinced that when politicians say they are only going to soak the rich, they fear their own tax bills will go up.
There is another silver lining for the GOP: The Democrat's tax-happy policies are an even less palatable message to voters. Sen. Jon Kyl of Arizona, who has sat in the GOP tax strategy sessions tells me that "an overriding concern of economically anxious voters today is that they don't see their own taxes rise."
Pollster David Winston, who's been testing the tax issue for Republicans, agrees with that assessment. When Mr. Winston asked a national sample of registered voters last month, "Do you believe or not believe this statement: Given the cost of living these days, now is not the time to raise taxes," 65% believe now isn't the time to raise taxes, while only 31% believe it is.
There is another GOP imperative: The anti-tax message must be linked to wasteful government spending. "There's no question that for seven out of 10 American voters, wasteful government spending is one of the largest problems in Washington," says pollster Tony Fabrizio. "For many of these voters it's a bigger issue than taxes." All of the polling consistently finds that voters believe about 40 cents of every dollar spent by Washington is wasted. So this widespread aversion to the way government mishandles money may be the best shield against tax hikes--at all levels of government.
In Mr. Winston's survey, 75% of respondents agreed that, "Taxes should not be increased as long as Congress continues to waste the tax money it already receives." Only 23% did not.
Perhaps the most encouraging poll finding is that Americans fully understand the link between a strong economy and deficits. In 2006 federal revenues increased by a world record $250 billion, because of surging employment, corporate profits, and stock values. No Hillary Clinton tax hike could have possibly raised that kind of money.
This is a nation that instinctively gets the supply-side message that putting people to work yields more tax revenues than a strategy of weighing down businesses and workers with tax hikes, which explains this stunning finding: When Mr. Winston's poll asked, "Which approach is more likely to increase federal revenues?" 81% said "increasing economic growth" while only 13% said "increasing taxes."
So the tax issue is still radioactive with most voters, and the GOP would be foolhardy to run and hide from it. That's especially true because if the economy slows down in the coming months due to the housing credit crunch, aversion to higher taxes is likely to intensify.
"Voters' biggest economic concern is whether they will have enough money to meet their own needs," says Sen. Kyl. He says that if Republicans are going to win in 2008, they have to persuade voters that Democratic tax hikes "will make things worse" for the economy and their own personal finances. Fortunately, this message has the added attraction that it's not just pollster-driven spin. It's the truth.
Mr. Moore is senior economics writer for the Wall Street Journal editorial page.
GOP Tax Dilemma
After years of waste in Congress, voters aren't buying the party's fiscal message.
BY STEPHEN MOORE
Friday, October 5, 2007 12:01 a.m. EDT - Wall Street Journal
A few weeks ago Republican leaders gathered on Capitol Hill to hear from their top pollsters and pundits about how they can win back the votes of independent voters. Some of the attendees are still in a state of cardiac arrest over what they learned.
America's swing voters, especially the suburban "security moms," who abandoned the GOP in droves in 2006 still hold Republicans in very low regard. What has party tacticians especially spooked is that these independents are apparently not much attracted to what the Republicans are saying about taxes. That's a bitter pill for party leaders to swallow, because for 25 years the anti-tax banner has been a political trump card for conservative candidates. A top strategist at the Republican National Committee who attended the meeting told me: "Our tax message has worn thin."
Well, that's not exactly true. It is true that the GOP message on taxes needs a makeover, perhaps a radical one--and the party's congressional leaders had better figure this out soon: The big tax fight starts as early as next week when House Ways and Means Committee Chairman Charlie Rangle unveils his multibillion dollar soak-the-rich tax hike plan to pay for middle-class Alternative Minimum Tax relief. So let's review some of the key attitudinal shifts of voters on taxes as revealed in recent polls and focus-group findings.
First, the not-so-good news for the GOP. Most voters are unpersuaded by the Republican message that the Bush tax cuts were a resounding success that pumped the economy back to life. Worse, the key independent voters are actually repelled by that message. "It crashes like the Hindenburg," says Richard Thau, who has been monitoring swing voter sentiments across the nation. Why? Because politicians who boast about the rosy economy seem out of touch, even delusional, given the rising costs of gasoline, health insurance and college tuition.
The reality, of course, is that the investment tax cuts did help create seven million jobs and did steer the economy out of recession. That doesn't matter to these "stressed out" voters, as Mr. Thau calls them. The Bush tax cuts are a bridge to the past, not the future, to borrow a Clintonite term. Moreover, because local property and school taxes have been skyrocketing, many independent voters scratch their heads and wonder: What tax cuts?
There is more deflating news. Unlike in the 1980s and '90s, voters are today less attracted to talk of new tax cuts, which they think are pie-in-the-sky, given the current war costs and budget-deficit. Nor are they averse to raising taxes on "the wealthy," a group they are persuaded is taking advantage of tax loopholes to avoid paying their fair share. That the richest 10% already pay two-thirds of the income taxes isn't well understood. One strong defense mechanism against the left's class warfare tax policy is that roughly half of voters are convinced that when politicians say they are only going to soak the rich, they fear their own tax bills will go up.
There is another silver lining for the GOP: The Democrat's tax-happy policies are an even less palatable message to voters. Sen. Jon Kyl of Arizona, who has sat in the GOP tax strategy sessions tells me that "an overriding concern of economically anxious voters today is that they don't see their own taxes rise."
Pollster David Winston, who's been testing the tax issue for Republicans, agrees with that assessment. When Mr. Winston asked a national sample of registered voters last month, "Do you believe or not believe this statement: Given the cost of living these days, now is not the time to raise taxes," 65% believe now isn't the time to raise taxes, while only 31% believe it is.
There is another GOP imperative: The anti-tax message must be linked to wasteful government spending. "There's no question that for seven out of 10 American voters, wasteful government spending is one of the largest problems in Washington," says pollster Tony Fabrizio. "For many of these voters it's a bigger issue than taxes." All of the polling consistently finds that voters believe about 40 cents of every dollar spent by Washington is wasted. So this widespread aversion to the way government mishandles money may be the best shield against tax hikes--at all levels of government.
In Mr. Winston's survey, 75% of respondents agreed that, "Taxes should not be increased as long as Congress continues to waste the tax money it already receives." Only 23% did not.
Perhaps the most encouraging poll finding is that Americans fully understand the link between a strong economy and deficits. In 2006 federal revenues increased by a world record $250 billion, because of surging employment, corporate profits, and stock values. No Hillary Clinton tax hike could have possibly raised that kind of money.
This is a nation that instinctively gets the supply-side message that putting people to work yields more tax revenues than a strategy of weighing down businesses and workers with tax hikes, which explains this stunning finding: When Mr. Winston's poll asked, "Which approach is more likely to increase federal revenues?" 81% said "increasing economic growth" while only 13% said "increasing taxes."
So the tax issue is still radioactive with most voters, and the GOP would be foolhardy to run and hide from it. That's especially true because if the economy slows down in the coming months due to the housing credit crunch, aversion to higher taxes is likely to intensify.
"Voters' biggest economic concern is whether they will have enough money to meet their own needs," says Sen. Kyl. He says that if Republicans are going to win in 2008, they have to persuade voters that Democratic tax hikes "will make things worse" for the economy and their own personal finances. Fortunately, this message has the added attraction that it's not just pollster-driven spin. It's the truth.
Mr. Moore is senior economics writer for the Wall Street Journal editorial page.
Thursday, October 4, 2007
LTTE: Lapses in judgment
Here is my response to Rep. Jim Oberstar's recent commentary, posted below. The letter appeared in the Oct. 1, 2007 edition of the St. Paul Pioneer Press.
Lapses in judgment
Rep. Jim Oberstar's recent commentary lashing out at the National Taxpayers Union as a "naysayer" organization is utterly laughable.
As the chairman of the House Transportation Committee, he should be working to prevent and fix problems instead of playing the blame game. He also fails to hold himself accountable in the process.
Oberstar points at the time it takes for freight to go through Chicago as a major concern without mentioning how he has failed to secure much-needed funding for the city of Duluth, which would enable a port in his home district to become a major hub for multi-modal freight.
He points out the need for bridge repair, but never advocated it before the I-35W bridge collapsed.
Instead, he continues to spend more earmarks on bicycle trails in his home district, mass transit and other risky schemes while continuing to blame others for his lapses of judgment.
- J. Scott Williams
Maplewood
Lapses in judgment
Rep. Jim Oberstar's recent commentary lashing out at the National Taxpayers Union as a "naysayer" organization is utterly laughable.
As the chairman of the House Transportation Committee, he should be working to prevent and fix problems instead of playing the blame game. He also fails to hold himself accountable in the process.
Oberstar points at the time it takes for freight to go through Chicago as a major concern without mentioning how he has failed to secure much-needed funding for the city of Duluth, which would enable a port in his home district to become a major hub for multi-modal freight.
He points out the need for bridge repair, but never advocated it before the I-35W bridge collapsed.
Instead, he continues to spend more earmarks on bicycle trails in his home district, mass transit and other risky schemes while continuing to blame others for his lapses of judgment.
- J. Scott Williams
Maplewood
Thursday, September 27, 2007
How Effective Has Monetary Policy Been?
ST. LOUIS, Sept. 27 /PRNewswire/ -- Central banks that have a specific,numeric target for inflation appear to have a good record of hitting those targets, but an analysis from the Federal Reserve Bank of St. Louis suggests that such targets may not be a prerequisite for achieving low and stable inflation.
The analysis was conducted by Marcela M. Williams, a senior research associate, and Robert H. Rasche, a senior vice president and director of research at the Federal Reserve Bank of St. Louis. Their research appears in the September/October issue of Review, the Reserve Bank's bimonthly journal of economic and business issues. The publication is also available online at the St. Louis Fed's web site:
http://research.stlouisfed.org/publications/review.
Williams and Rasche looked at 23 inflation-targeting countries and measured the moving average of their inflation rates. Generally speaking,they found these countries have been quite successful at keeping their long-term inflation rates within their target ranges. The most successful in meeting their targets are New Zealand, Norway, Switzerland, Thailand and the United Kingdom, which have all maintained an average inflation rate well within their target ranges, even before those ranges were explicitly defined. The exceptions are Brazil, Mexico and the
Philippines, while some countries, such as Chile, Colombia and Hungary have
been able to bring their inflation rates down over time.
To assess the disposition on the subject by members of the Federal Open Market Committee (FOMC), Williams and Rasche compiled transcripts and public statements of various Fed officials and FOMC members for the past decade or so.
Although the Fed does not set an explicit inflation target, some Fed officials have publicly stated their preference for doing so, including Governor Ben Bernanke, Dallas Fed President Jeffrey Lacker, San Francisco Fed President Janet Yellen and Philadelphia Fed President Anthony Santomero. Williams and Rasche describe St. Louis Fed President William Poole's statements regarding explicit inflation targets as "ambivalent."
Governor Donald Kohn, among others, has expressed opposition to an inflation target for the central bank.
Williams and Rasche emphasized that that the Fed's success over the past two decades in stabilizing the inflation rate without using explicit inflation targets would seem to question the marginal benefit of targeting,at least in the United States.
In addition, they surveyed historical research and commentaries to examine why evidence of the effects of monetary policy on output stabilization are so elusive. While a number of studies show the contractionary effects of monetary policy, results from econometric models often conflict with historical evidence, and economists debate how to reconcile those discrepancies.
Finally, Williams and Rasche concluded that the case for consistently effective short-run monetary stabilization policies is problematic because there are just too much uncertainties in the environment in which central banks operate.
With branches in Little Rock, Louisville and Memphis, the Federal Reserve Bank of St. Louis serves the Eighth Federal Reserve District, which includes all of Arkansas, eastern Missouri, southern Indiana, southern Illinois, western Kentucky, western Tennessee and northern Mississippi. The St. Louis Fed is one of 12 regional Reserve Banks that, along with the Board of Governors in Washington, D.C., comprise the Federal Reserve System. As the nation's central bank, the Federal Reserve System formulates U.S. monetary policy, regulates state-chartered member banks and bank
holding companies, and provides payment services to financial institutions and the U.S. government.
The analysis was conducted by Marcela M. Williams, a senior research associate, and Robert H. Rasche, a senior vice president and director of research at the Federal Reserve Bank of St. Louis. Their research appears in the September/October issue of Review, the Reserve Bank's bimonthly journal of economic and business issues. The publication is also available online at the St. Louis Fed's web site:
http://research.stlouisfed.org/publications/review.
Williams and Rasche looked at 23 inflation-targeting countries and measured the moving average of their inflation rates. Generally speaking,they found these countries have been quite successful at keeping their long-term inflation rates within their target ranges. The most successful in meeting their targets are New Zealand, Norway, Switzerland, Thailand and the United Kingdom, which have all maintained an average inflation rate well within their target ranges, even before those ranges were explicitly defined. The exceptions are Brazil, Mexico and the
Philippines, while some countries, such as Chile, Colombia and Hungary have
been able to bring their inflation rates down over time.
To assess the disposition on the subject by members of the Federal Open Market Committee (FOMC), Williams and Rasche compiled transcripts and public statements of various Fed officials and FOMC members for the past decade or so.
Although the Fed does not set an explicit inflation target, some Fed officials have publicly stated their preference for doing so, including Governor Ben Bernanke, Dallas Fed President Jeffrey Lacker, San Francisco Fed President Janet Yellen and Philadelphia Fed President Anthony Santomero. Williams and Rasche describe St. Louis Fed President William Poole's statements regarding explicit inflation targets as "ambivalent."
Governor Donald Kohn, among others, has expressed opposition to an inflation target for the central bank.
Williams and Rasche emphasized that that the Fed's success over the past two decades in stabilizing the inflation rate without using explicit inflation targets would seem to question the marginal benefit of targeting,at least in the United States.
In addition, they surveyed historical research and commentaries to examine why evidence of the effects of monetary policy on output stabilization are so elusive. While a number of studies show the contractionary effects of monetary policy, results from econometric models often conflict with historical evidence, and economists debate how to reconcile those discrepancies.
Finally, Williams and Rasche concluded that the case for consistently effective short-run monetary stabilization policies is problematic because there are just too much uncertainties in the environment in which central banks operate.
With branches in Little Rock, Louisville and Memphis, the Federal Reserve Bank of St. Louis serves the Eighth Federal Reserve District, which includes all of Arkansas, eastern Missouri, southern Indiana, southern Illinois, western Kentucky, western Tennessee and northern Mississippi. The St. Louis Fed is one of 12 regional Reserve Banks that, along with the Board of Governors in Washington, D.C., comprise the Federal Reserve System. As the nation's central bank, the Federal Reserve System formulates U.S. monetary policy, regulates state-chartered member banks and bank
holding companies, and provides payment services to financial institutions and the U.S. government.
Tuesday, September 25, 2007
Oberstar: We need more investment, more modes, less congestion
The following commentary appeared in the Sept. 23 issue of the St. Paul Pioneer Press.
By Rep. James Oberstar
The history of transportation is full of skeptics who have stood in the way of progress. Ranging from those who thought a ship would sail off the edge of the Earth to critics who proclaimed that if man were meant to fly he would have wings, these skeptics have been proven wrong throughout the ages.
I count the National Taxpayers Union (NTU) as one such group of naysayers ("Building bridges: don't raise taxes" Sept. 17). NTU has been a persistent critic of public transportation, light rail, commuter rail and even bike and foot paths. They claim all of these modes of transportation are draining tax dollars needed to fund their preferred mode of transportation: freeways.
NTU is stuck in the past, vainly hoping that adding a few more lanes on a freeway system that was designed in the late 1950s and built in the 1960s will keep pace with the transportation needs of the 21st century. However, our economy has grown far beyond the ability of any single mode of transportation to move all of our nation's people and products.
NTU is also wrong to claim that funding levels for transportation are adequate. In the last federal highway aid bill the U.S. Department of Transportation recommended spending $375 billion over six years to maintain our roads and bridges and keep up with congestion. Instead, the president used the threat of a veto to hold the amount of our investment to $286 billion, nearly $90 billion short of the figure his own administration recommended.
Our nation has 73,784 structurally deficient bridges on the national highway system. Congestion on our freeways is growing faster than we can keep up with. According to a report this past week by Texas AM University's Texas Transportation Institute, the average Minnesotan sits in traffic 43 hours a year, burning 30 extra gallons of gas. In effect, this wasted fuel and time levies a $78 billion-a-year congestion tax nationwide, on drivers and businesses. Freeway congestion costs Minnesota's economy $1.1 billion a year. We cannot afford to continue under-investing in our transportation infrastructure.
Congestion is not just limited to our freeways. Right now it takes a cargo container, arriving on our West Coast, 40 hours to travel 1,800 miles to Chicago. It then takes another 36 hours to travel the next seven miles through Chicago's rail yards. We need to make major investments in our nation's freight and passenger rail systems.
The amount of freight being shipped on our nation's rails and roads has increased dramatically in the past two decades. Our economy now calls for just-in-time delivery of goods, making many of the trucks on our highways rolling warehouses, as they move products to market.
Another way to relieve some of the pressure from our highways and railways is to develop a new form of shipping altogether. Short sea shipping would call for the creation of new cargo vessels that move up and down the nation's four coasts. I authored and the House passed legislation to create subsidized loans for the shipping industry to design and build this new class of energy efficient cargo vessels, for the Great Lakes and the salt-water coasts.
If we make the needed investments in technology and research, our nation's transportation system in the 21st century will be multi-modal. Freight containers will move seamlessly from factory to truck, to train, to ship, finding the most cost-effective route to the marketplace. Commuters will be able to walk or bike to a train station to go to work. Our freeways will be upgraded to allow for greater capacity and more efficient flow of traffic. American innovation and new transportation technologies will make gridlock a thing of the past.
The NTU and other skeptics are not looking at the big picture. They have to look through their bug-spattered windshields and past the bumper of the car they are stuck behind in traffic to see that our nation needs a diverse, inter-modal transportation system to serve the needs of 21st century America.
Rep. Jim Oberstar represents Minnesota's 8th Congressional District in the U.S. House of Representatives and is chairman of the Transportation and Infrastructure Committee.
By Rep. James Oberstar
The history of transportation is full of skeptics who have stood in the way of progress. Ranging from those who thought a ship would sail off the edge of the Earth to critics who proclaimed that if man were meant to fly he would have wings, these skeptics have been proven wrong throughout the ages.
I count the National Taxpayers Union (NTU) as one such group of naysayers ("Building bridges: don't raise taxes" Sept. 17). NTU has been a persistent critic of public transportation, light rail, commuter rail and even bike and foot paths. They claim all of these modes of transportation are draining tax dollars needed to fund their preferred mode of transportation: freeways.
NTU is stuck in the past, vainly hoping that adding a few more lanes on a freeway system that was designed in the late 1950s and built in the 1960s will keep pace with the transportation needs of the 21st century. However, our economy has grown far beyond the ability of any single mode of transportation to move all of our nation's people and products.
NTU is also wrong to claim that funding levels for transportation are adequate. In the last federal highway aid bill the U.S. Department of Transportation recommended spending $375 billion over six years to maintain our roads and bridges and keep up with congestion. Instead, the president used the threat of a veto to hold the amount of our investment to $286 billion, nearly $90 billion short of the figure his own administration recommended.
Our nation has 73,784 structurally deficient bridges on the national highway system. Congestion on our freeways is growing faster than we can keep up with. According to a report this past week by Texas AM University's Texas Transportation Institute, the average Minnesotan sits in traffic 43 hours a year, burning 30 extra gallons of gas. In effect, this wasted fuel and time levies a $78 billion-a-year congestion tax nationwide, on drivers and businesses. Freeway congestion costs Minnesota's economy $1.1 billion a year. We cannot afford to continue under-investing in our transportation infrastructure.
Congestion is not just limited to our freeways. Right now it takes a cargo container, arriving on our West Coast, 40 hours to travel 1,800 miles to Chicago. It then takes another 36 hours to travel the next seven miles through Chicago's rail yards. We need to make major investments in our nation's freight and passenger rail systems.
The amount of freight being shipped on our nation's rails and roads has increased dramatically in the past two decades. Our economy now calls for just-in-time delivery of goods, making many of the trucks on our highways rolling warehouses, as they move products to market.
Another way to relieve some of the pressure from our highways and railways is to develop a new form of shipping altogether. Short sea shipping would call for the creation of new cargo vessels that move up and down the nation's four coasts. I authored and the House passed legislation to create subsidized loans for the shipping industry to design and build this new class of energy efficient cargo vessels, for the Great Lakes and the salt-water coasts.
If we make the needed investments in technology and research, our nation's transportation system in the 21st century will be multi-modal. Freight containers will move seamlessly from factory to truck, to train, to ship, finding the most cost-effective route to the marketplace. Commuters will be able to walk or bike to a train station to go to work. Our freeways will be upgraded to allow for greater capacity and more efficient flow of traffic. American innovation and new transportation technologies will make gridlock a thing of the past.
The NTU and other skeptics are not looking at the big picture. They have to look through their bug-spattered windshields and past the bumper of the car they are stuck behind in traffic to see that our nation needs a diverse, inter-modal transportation system to serve the needs of 21st century America.
Rep. Jim Oberstar represents Minnesota's 8th Congressional District in the U.S. House of Representatives and is chairman of the Transportation and Infrastructure Committee.
Bush: Not Fixing Social Security Not Fair
From the Associated Press (9/24):
Bush: Not fixing Social Security not fair
Treasury report recommends benefit cuts, tax increases to fix funding shortfall
BY MARTIN CRUTSINGER Associated Press
WASHINGTON - The Bush administration said in a new report Monday that Social Security is facing a $13.6 trillion shortfall and delaying needed reforms is not fair to younger workers.
A report issued by the Treasury Department said some combination of benefit cuts and tax increases will need to be considered to permanently fix the funding shortfall. But White House officials stressed President Bush remains opposed to raising taxes.
The Treasury report put the cost of the gap between what Social Security is expected to need to pay out in benefits and what it will raise in payroll taxes in coming years at $13.6 trillion.
It said delaying necessary changes reduces the number of people available to share in the resulting burden and is unfair to younger workers. "Not taking action is thus unfair to future generations. This is a significant cost of delay," the report said.
In another key finding, the report said: "Social Security can be made permanently solvent only by reducing the present value of scheduled benefits and/or increasing the present value of scheduled tax increases."
The paper went on to say: "Other changes to the program might be desirable, but only these changes can restore solvency permanently."
While the Treasury report language seemed to indicate the administration would consider raising taxes along with reducing benefits as a way to deal with the funding shortfall, the White House was quick to reject that possibility.
"The president is not advocating for tax increases or benefit cuts," said White House spokesman Tony Fratto.
"Everyone understands that the choices available in the current structure of Social Security, that absent reform, tax increases and benefit cuts are inevitable," Fratto said. "That's why the president believes it makes more sense to reform the program sooner than later."
Treasury Secretary Henry Paulson, Bush's point person on Social Security reform, said he has had a number of discussions with members of Congress from both parties over the issue of fixing the problems in Social Security with the looming retirement of 78 million baby boomers.
"The administration's new report is a reminder of President Bush's determination to not only privatize Social Security but to make deep cuts in the benefits that American workers have earned," said Senate Majority Leader Harry Reid, D-Nev. "Nobody should be fooled into believing that the only way to save Social Security is to destroy it with privatization or deep benefit cuts."
Bush had hoped to make Social Security reform the top domestic priority of his second term. Bush put forward a Social Security reform plan in 2005 that focused on creation of private accounts for younger workers but that proposal never came up for a vote in Congress, with Democrats heavily opposed and few Republicans embracing the idea.
While Democrats have fought to protect current benefit levels, Republicans have been adamant that taxes should not be raised to cover the Social Security shortfall.
Phil Swaigel, Treasury's assistant secretary for economic policy, told reporters the plan was to release about six issue briefs on Social Security over the next three months. But he said it was "unclear" at the moment whether the papers would lead to a new push to get an overhaul program through Congress next year.
Many believe such an effort would be unlikely to gain success in 2008, a presidential election year when one-third of the Senate and all House members also will be facing re-election.
Paulson, however, has said even if he is not able to achieve an agreement during the short time the current administration will be in office, he hopes to lay the groundwork for the next administration and a new Congress to tackle the problem.
Bush: Not fixing Social Security not fair
Treasury report recommends benefit cuts, tax increases to fix funding shortfall
BY MARTIN CRUTSINGER Associated Press
WASHINGTON - The Bush administration said in a new report Monday that Social Security is facing a $13.6 trillion shortfall and delaying needed reforms is not fair to younger workers.
A report issued by the Treasury Department said some combination of benefit cuts and tax increases will need to be considered to permanently fix the funding shortfall. But White House officials stressed President Bush remains opposed to raising taxes.
The Treasury report put the cost of the gap between what Social Security is expected to need to pay out in benefits and what it will raise in payroll taxes in coming years at $13.6 trillion.
It said delaying necessary changes reduces the number of people available to share in the resulting burden and is unfair to younger workers. "Not taking action is thus unfair to future generations. This is a significant cost of delay," the report said.
In another key finding, the report said: "Social Security can be made permanently solvent only by reducing the present value of scheduled benefits and/or increasing the present value of scheduled tax increases."
The paper went on to say: "Other changes to the program might be desirable, but only these changes can restore solvency permanently."
While the Treasury report language seemed to indicate the administration would consider raising taxes along with reducing benefits as a way to deal with the funding shortfall, the White House was quick to reject that possibility.
"The president is not advocating for tax increases or benefit cuts," said White House spokesman Tony Fratto.
"Everyone understands that the choices available in the current structure of Social Security, that absent reform, tax increases and benefit cuts are inevitable," Fratto said. "That's why the president believes it makes more sense to reform the program sooner than later."
Treasury Secretary Henry Paulson, Bush's point person on Social Security reform, said he has had a number of discussions with members of Congress from both parties over the issue of fixing the problems in Social Security with the looming retirement of 78 million baby boomers.
"The administration's new report is a reminder of President Bush's determination to not only privatize Social Security but to make deep cuts in the benefits that American workers have earned," said Senate Majority Leader Harry Reid, D-Nev. "Nobody should be fooled into believing that the only way to save Social Security is to destroy it with privatization or deep benefit cuts."
Bush had hoped to make Social Security reform the top domestic priority of his second term. Bush put forward a Social Security reform plan in 2005 that focused on creation of private accounts for younger workers but that proposal never came up for a vote in Congress, with Democrats heavily opposed and few Republicans embracing the idea.
While Democrats have fought to protect current benefit levels, Republicans have been adamant that taxes should not be raised to cover the Social Security shortfall.
Phil Swaigel, Treasury's assistant secretary for economic policy, told reporters the plan was to release about six issue briefs on Social Security over the next three months. But he said it was "unclear" at the moment whether the papers would lead to a new push to get an overhaul program through Congress next year.
Many believe such an effort would be unlikely to gain success in 2008, a presidential election year when one-third of the Senate and all House members also will be facing re-election.
Paulson, however, has said even if he is not able to achieve an agreement during the short time the current administration will be in office, he hopes to lay the groundwork for the next administration and a new Congress to tackle the problem.
Sunday, September 23, 2007
Bush can't be Keynesian supply-sider
The following appeared in the Sept. 23, 2007 issue of the St. Paul Pioneer Press and was written by Ed Lotterman. A link to the story may be found here.
It is too bad the Old Testament prophet Elijah never passed through Washington, D.C. His challenge to the Israelites in 1 Kings 18, "Choose ye this day whom ye will serve," is a powerful argument against holding two diametrically opposed positions at the same time. Unfortunately, that is a common occurrence in our nation's capital.
Confusion is evident in the White House response to Alan Greenspan's criticism of administration fiscal policies. Defending President Bush, Press Secretary Dana Perino said, "in late 2000, we were headed into a recession, and tax cuts were the prescribed remedy."
Perino is correct. Tax cuts are a prescribed remedy for a recession - if you are a Keynesian. But George W. Bush did not run for office as a Keynesian. He ran as a supply-sider. Supply-side economists are the most diametrically opposed to Keynes of any school of economic thought. The very name "supply-side" is a rejection of the demand-side jockeying John Maynard Keynes advocated.
Supply-side economists argued that trying to micro-manage an economy by manipulating consumer spending was short-sighted and counterproductive. Keynesian tromping of economic gas and brake pedals to regulate demand harms rather than hurts, they said.
Focus instead on the supply side of the economy, they argued. Reduce regulation of economic activity. Increase incentives for saving and investment. That means lowering high marginal income tax rates and taxes on investment earnings from interest, dividends and capital gains. The object is to increase investment. That requires more savings and, thus, less current consumption.
That was the platform on which George W. Bush ran for office in 2000 and was his rationale for tax cuts in 2001. But by the 2004 election, his arguments had changed. Cutting taxes was needed to spur household consumption. That is back to pure Keynesianism.
The problem is that if you cut taxes to spur demand because the economy faces recession, you have to raise them to curtail demand when it really gets rolling. That should have happened two years ago, but the administration showed no willingness to implement the other half of Keynes' prescription.
Just as ancient Israelites could follow Yahweh or Baal, you can be a Keynesian or a supply-sider. But you cannot be both.
Confused economic policy is not original to the Bush administration.
Jimmy Carter's economic advisers were dyed-in-the-wool Keynesians.
But the Carter White house never could decide if it needed to spur the economy to lower unemployment or retard it to cut inflation.
We ended up with the worst combination of both inflation and unemployment in decades.
It is too bad the Old Testament prophet Elijah never passed through Washington, D.C. His challenge to the Israelites in 1 Kings 18, "Choose ye this day whom ye will serve," is a powerful argument against holding two diametrically opposed positions at the same time. Unfortunately, that is a common occurrence in our nation's capital.
Confusion is evident in the White House response to Alan Greenspan's criticism of administration fiscal policies. Defending President Bush, Press Secretary Dana Perino said, "in late 2000, we were headed into a recession, and tax cuts were the prescribed remedy."
Perino is correct. Tax cuts are a prescribed remedy for a recession - if you are a Keynesian. But George W. Bush did not run for office as a Keynesian. He ran as a supply-sider. Supply-side economists are the most diametrically opposed to Keynes of any school of economic thought. The very name "supply-side" is a rejection of the demand-side jockeying John Maynard Keynes advocated.
Supply-side economists argued that trying to micro-manage an economy by manipulating consumer spending was short-sighted and counterproductive. Keynesian tromping of economic gas and brake pedals to regulate demand harms rather than hurts, they said.
Focus instead on the supply side of the economy, they argued. Reduce regulation of economic activity. Increase incentives for saving and investment. That means lowering high marginal income tax rates and taxes on investment earnings from interest, dividends and capital gains. The object is to increase investment. That requires more savings and, thus, less current consumption.
That was the platform on which George W. Bush ran for office in 2000 and was his rationale for tax cuts in 2001. But by the 2004 election, his arguments had changed. Cutting taxes was needed to spur household consumption. That is back to pure Keynesianism.
The problem is that if you cut taxes to spur demand because the economy faces recession, you have to raise them to curtail demand when it really gets rolling. That should have happened two years ago, but the administration showed no willingness to implement the other half of Keynes' prescription.
Just as ancient Israelites could follow Yahweh or Baal, you can be a Keynesian or a supply-sider. But you cannot be both.
Confused economic policy is not original to the Bush administration.
Jimmy Carter's economic advisers were dyed-in-the-wool Keynesians.
But the Carter White house never could decide if it needed to spur the economy to lower unemployment or retard it to cut inflation.
We ended up with the worst combination of both inflation and unemployment in decades.
AP - Bank runs here unlikely thanks to FDIC
Bank runs here unlikely thanks to FDIC
Sept. 23, 2007 (AP) - For many Americans born after the Depression, bank runs are just scenes out of movies like "It's a Wonderful Life."
The troubles at British lender Northern Rock PLC show they can still happen, but it's much less likely that Americans will be seen queuing up outside banks anytime soon to collect their cash as British depositors have this week. The U.S. banking system has different rules and procedures than its U.K. counterpart to guarantee the nation's $4.2 trillion in insured deposits are backed by the government.
Americans can get spooked like anyone else - when the U.S. lender Countrywide Financial Corp. acknowledged sharp losses in its mortgage business, customers packed its bank branches and jammed its online operations, trying to get answers and cash out.
The United States has seen nothing in decades like the billions of dollars Britons have withdrawn from banks in recent days, however.
The reason is largely that the Federal Deposit Insurance Corp. guarantees up to $100,000 per account per bank, and $250,000 for retirement accounts. In Britain, the government guarantees all deposits below 2,000 pounds ($4,000), 90 percent of deposits up to 35,000 pounds ($70,000), and nothing above that.
Furthermore, in the United States, even deposits beyond the $100,000 limit are probably safe, given the Federal Reserve has procedures to keep banks solvent.
The chance of a run on a U.S. bank is "almost nil," according to Richard Bove, a bank analyst at Punk Ziegel & Co. He added that Fed Chairman Ben Bernanke has repeated that he's willing to rescue the banking system.
U.S. bank runs are possible, as the brief panic over Countrywide suggested. But even if one happens, U.S. depositors shouldn't fret too much about losing their shirts.
Sept. 23, 2007 (AP) - For many Americans born after the Depression, bank runs are just scenes out of movies like "It's a Wonderful Life."
The troubles at British lender Northern Rock PLC show they can still happen, but it's much less likely that Americans will be seen queuing up outside banks anytime soon to collect their cash as British depositors have this week. The U.S. banking system has different rules and procedures than its U.K. counterpart to guarantee the nation's $4.2 trillion in insured deposits are backed by the government.
Americans can get spooked like anyone else - when the U.S. lender Countrywide Financial Corp. acknowledged sharp losses in its mortgage business, customers packed its bank branches and jammed its online operations, trying to get answers and cash out.
The United States has seen nothing in decades like the billions of dollars Britons have withdrawn from banks in recent days, however.
The reason is largely that the Federal Deposit Insurance Corp. guarantees up to $100,000 per account per bank, and $250,000 for retirement accounts. In Britain, the government guarantees all deposits below 2,000 pounds ($4,000), 90 percent of deposits up to 35,000 pounds ($70,000), and nothing above that.
Furthermore, in the United States, even deposits beyond the $100,000 limit are probably safe, given the Federal Reserve has procedures to keep banks solvent.
The chance of a run on a U.S. bank is "almost nil," according to Richard Bove, a bank analyst at Punk Ziegel & Co. He added that Fed Chairman Ben Bernanke has repeated that he's willing to rescue the banking system.
U.S. bank runs are possible, as the brief panic over Countrywide suggested. But even if one happens, U.S. depositors shouldn't fret too much about losing their shirts.
Friday, September 21, 2007
Fiscal Wake-Up Tour to visit Manchester N.H.
The Fiscal Wake-Up Tour Comes to Manchester to Discuss Our Nation's Unsustainable Fiscal Policy
WASHINGTON, Sept. 21 /PRNewswire-USNewswire/ -- On Friday, September 28th, The Concord Coalition will join with other federal budget analysts to host a stop on our Fiscal Wake-Up Tour, a nationwide series of town hall forums on the nation's long-term fiscal challenge. U.S. Comptroller General David M. Walker will be the featured speaker. The event will be held at the
Derryfield Country Club in Manchester and will be open to the press and public.
"One thing that Democrats and Republicans can agree on is that our nation's current fiscal policy is not sustainable over the long-term. Our children's economic future is at risk, which is something no one wants. Changing course will require hard choices such as scaling back future entitlement promises, increasing revenues to pay for them, or -- most likely -- a combination of both. Because these choices are politically difficult, the active involvement of the American people is critical. Without greater understanding of the problem among the public, community leaders, business leaders and home state media, elected leaders are unlikely to break out of their comfortable partisan talking points and unlikely to find solutions. That is why we began the nationwide Fiscal Wake-Up Tour. As demonstrated by the recent election result, voters are tired of partisan gridlock. This gives both parties an opportunity and a duty to begin working together on the real problem we face. Ensuring a sound fiscal future for our children should certainly be high on their list," said Robert L. Bixby, executive director of The Concord Coalition.
What: Fiscal Wake-Up Tour
Where: The Derryfield Country Club
625 Mammoth Road
Manchester, NH 03104
When: Friday, September 28, 2007
11:30 AM to 1:00 PM
Who: U.S. Comptroller General David M. Walker
Robert L. Bixby, The Concord Coalition
Brian Reidl, The Heritage Foundation
Paul Cullinan, The Brookings Institution
RSVP to Greater Manchester Chamber of Commerce at
603-666-6600 Ext: 122, or online at:
http://www.manchester-chamber.org/
WASHINGTON, Sept. 21 /PRNewswire-USNewswire/ -- On Friday, September 28th, The Concord Coalition will join with other federal budget analysts to host a stop on our Fiscal Wake-Up Tour, a nationwide series of town hall forums on the nation's long-term fiscal challenge. U.S. Comptroller General David M. Walker will be the featured speaker. The event will be held at the
Derryfield Country Club in Manchester and will be open to the press and public.
"One thing that Democrats and Republicans can agree on is that our nation's current fiscal policy is not sustainable over the long-term. Our children's economic future is at risk, which is something no one wants. Changing course will require hard choices such as scaling back future entitlement promises, increasing revenues to pay for them, or -- most likely -- a combination of both. Because these choices are politically difficult, the active involvement of the American people is critical. Without greater understanding of the problem among the public, community leaders, business leaders and home state media, elected leaders are unlikely to break out of their comfortable partisan talking points and unlikely to find solutions. That is why we began the nationwide Fiscal Wake-Up Tour. As demonstrated by the recent election result, voters are tired of partisan gridlock. This gives both parties an opportunity and a duty to begin working together on the real problem we face. Ensuring a sound fiscal future for our children should certainly be high on their list," said Robert L. Bixby, executive director of The Concord Coalition.
What: Fiscal Wake-Up Tour
Where: The Derryfield Country Club
625 Mammoth Road
Manchester, NH 03104
When: Friday, September 28, 2007
11:30 AM to 1:00 PM
Who: U.S. Comptroller General David M. Walker
Robert L. Bixby, The Concord Coalition
Brian Reidl, The Heritage Foundation
Paul Cullinan, The Brookings Institution
RSVP to Greater Manchester Chamber of Commerce at
603-666-6600 Ext: 122, or online at:
http://www.manchester-chamber.org/
Alaska abandons 'Bridge to Nowhere' project
Americans for Prosperity Calls Victorious Defeat of Bridge to Nowhere a Testament to the Power of Grassroots Activism
Citizen Group Visited the Bridge to Nowhere in August 2006
WASHINGTON, Sept. 21 /PRNewswire-USNewswire/ -- On the heels of news today that the state of Alaska has officially abandoned plans to pursue the infamous Gravina Bridge to Nowhere project, Americans for Prosperity President Tim Phillips issued the following victory statement:
"The death of the Alaska Bridge to Nowhere is a testament to the power of grassroots activism. Citizen outrage against hard-earned tax dollars being wasted on questionable pet projects delivered this victory for taxpayers. To paraphrase the late Senator Everett Dirksen of Illinois, when citizen activists turned up the heat on Congress, lawmakers saw the light.
By communicating their frustration over this incredibly wasteful use of federal tax dollars, citizens created an environment in which the Bridge to Nowhere could not survive any longer.
"I applaud those hard-nosed lawmakers that helped to fight against the Bridge to Nowhere, including Senator Tom Coburn, Representative Jeff Flake, and Representative Mark Kirk.
"As we drove more than 10,000 miles across 37 states on our Ending Earmarks Express road tour last year, which visited the Bridge to Nowhere, one outraged citizen after another told us that the earmark favor factory must be shut down. By refusing to remain silent while their tax dollars were abused, citizens defeated the Bridge to Nowhere.
"This victory today is a key reason why over 1,000 citizens are committed to come to Washington, DC, as part of Americans for Prosperity Foundation's Defending the American Dream Summit on October 4-5. This Summit will be a massive show of force in support of fiscal restraint and against abuse of tax dollars. With these grassroots troops we can restore genuine fiscal restraint to Washington and bring an end to questionable earmarks like the Bridge to Nowhere."
Editors Note: Americans for Prosperity Foundation traveled over 10,000 miles across the nation on the Ending Earmarks Express road tour last year, visiting 37 states and 50 earmarks, including the Bridge to Nowhere. AFPF was the first Washington, DC-based group to visit the proposed site of the Gravina Bridge to Nowhere.
To view video of AFP President Tim Phillips speaking on the ferry from Gravina Island to Ketchikan, please visit: http://www.youtube.com/watch?v=f6q__0-krUo.
Americans for Prosperity (AFP) is the nation's premier grassroots
organization committed to advancing every individual's right to economic freedom and opportunity. AFP believes reducing the size and scope of government is the best safeguard to ensuring individual productivity and prosperity for all Americans. AFP educates and engages citizens in support of restraining state and federal government growth, and returning government to its constitutional limits.
Citizen Group Visited the Bridge to Nowhere in August 2006
WASHINGTON, Sept. 21 /PRNewswire-USNewswire/ -- On the heels of news today that the state of Alaska has officially abandoned plans to pursue the infamous Gravina Bridge to Nowhere project, Americans for Prosperity President Tim Phillips issued the following victory statement:
"The death of the Alaska Bridge to Nowhere is a testament to the power of grassroots activism. Citizen outrage against hard-earned tax dollars being wasted on questionable pet projects delivered this victory for taxpayers. To paraphrase the late Senator Everett Dirksen of Illinois, when citizen activists turned up the heat on Congress, lawmakers saw the light.
By communicating their frustration over this incredibly wasteful use of federal tax dollars, citizens created an environment in which the Bridge to Nowhere could not survive any longer.
"I applaud those hard-nosed lawmakers that helped to fight against the Bridge to Nowhere, including Senator Tom Coburn, Representative Jeff Flake, and Representative Mark Kirk.
"As we drove more than 10,000 miles across 37 states on our Ending Earmarks Express road tour last year, which visited the Bridge to Nowhere, one outraged citizen after another told us that the earmark favor factory must be shut down. By refusing to remain silent while their tax dollars were abused, citizens defeated the Bridge to Nowhere.
"This victory today is a key reason why over 1,000 citizens are committed to come to Washington, DC, as part of Americans for Prosperity Foundation's Defending the American Dream Summit on October 4-5. This Summit will be a massive show of force in support of fiscal restraint and against abuse of tax dollars. With these grassroots troops we can restore genuine fiscal restraint to Washington and bring an end to questionable earmarks like the Bridge to Nowhere."
Editors Note: Americans for Prosperity Foundation traveled over 10,000 miles across the nation on the Ending Earmarks Express road tour last year, visiting 37 states and 50 earmarks, including the Bridge to Nowhere. AFPF was the first Washington, DC-based group to visit the proposed site of the Gravina Bridge to Nowhere.
To view video of AFP President Tim Phillips speaking on the ferry from Gravina Island to Ketchikan, please visit: http://www.youtube.com/watch?v=f6q__0-krUo.
Americans for Prosperity (AFP) is the nation's premier grassroots
organization committed to advancing every individual's right to economic freedom and opportunity. AFP believes reducing the size and scope of government is the best safeguard to ensuring individual productivity and prosperity for all Americans. AFP educates and engages citizens in support of restraining state and federal government growth, and returning government to its constitutional limits.
U of MN Wrestling Coach supports balanced budget amendment
Minnesota Gophers wrestling coach J. Robinson (former Army captain and National Wrestling Hall of Fame inductee) had this to say in a Q&A session with St. Paul Pioneer Press columnist Bob Sansevere in the Sept. 21, 2007 issue of the paper, prior to the team's departure for a White House ceremony commemorating their 2007 National Championship.
You can read the whole interview here: http://www.twincities.com/columnists/ci_6953579?nclick_check=1
The second thing is a balanced budget amendment. Right now, politicians talk out of both sides of their mouth. They tell the poor people, "We're not going to cut your services." And they tell the rich people, "We're not going to raise your taxes." And they can do that and then go and vote for deficit spending. The politicians don't have to make hard choices. If you take away everybody's credit card so they can't charge anything, you know what you buy when you go to the grocery store? You buy hamburger. You don't buy steak. Because you can only afford hamburger. It makes your decision-making process completely different. It mandates what you have to do. So those two things will change America.
You can read the whole interview here: http://www.twincities.com/columnists/ci_6953579?nclick_check=1
Thursday, September 20, 2007
AP-Paulson urges Congress to lift U.S. debt ceiling
The following appeared in the Sept. 20 issue of the St. Paul Pioneer Press via the AP.
Treasury Secretary Henry Paulson told Congress on Wednesday the government will hit the current debt ceiling on Oct. 1. He sought quick action to increase the limit, saying it was essential to protect the "full faith and credit" of the country, especially at a time of financial market turmoil. The limit is $8.965 trillion. Unless Congress votes to raise it, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due. The United States has never defaulted on a debt payment, but the decision on whether to raise the debt ceiling often means a prolonged battle in Congress. That does not take into account moves the government often has to use, such as withdrawing investments from certain trust funds to create room for extra borrowing until Congress finally approved a debt-limit increase. This month, the Senate Finance Committee approved increasing the limit on the debt to $9.82 trillion. That boost of $850 billion would be the fifth since President Bush took office in 2001. The House approved an increase in May. The full Senate has not acted yet.
Treasury Secretary Henry Paulson told Congress on Wednesday the government will hit the current debt ceiling on Oct. 1. He sought quick action to increase the limit, saying it was essential to protect the "full faith and credit" of the country, especially at a time of financial market turmoil. The limit is $8.965 trillion. Unless Congress votes to raise it, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due. The United States has never defaulted on a debt payment, but the decision on whether to raise the debt ceiling often means a prolonged battle in Congress. That does not take into account moves the government often has to use, such as withdrawing investments from certain trust funds to create room for extra borrowing until Congress finally approved a debt-limit increase. This month, the Senate Finance Committee approved increasing the limit on the debt to $9.82 trillion. That boost of $850 billion would be the fifth since President Bush took office in 2001. The House approved an increase in May. The full Senate has not acted yet.
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