By ANDREW TAYLOR
Associated Press
WASHINGTON (AP) — President Barack Obama's Democratic allies in Congress are taking only baby steps with his budget, putting off crucial decisions on his ambitious plans to expand health care, curb global warming and raise taxes on the wealthy.
Presidents Ronald Reagan, Bill Clinton and both Bushes all got far stronger assists from Congress on their first budgets. Nonetheless, Obama, is counting on votes approving budget outlines this week to give him some semblance of momentum.
"If we don't pass the budget, it will empower those critics who don't want to see anything getting done," Obama told House Democrats Monday, according to a House aide who required anonymity to reveal what was said at the closed-door meeting.
Risk-averse Democrats, however, are merely kicking the can down the road rather than using the budget to give a real push to the president's agenda. On health care, global warming and even Obama's signature "Making Work Pay" tax cut, the pending House and Senate budget plans offer no clues as to how those big ideas might advance.
The House and Senate are expected to pass separate versions of the budget resolution by week's end, then reconcile differences after their spring break.
Budget resolutions are not law. They don't have to be signed by the president. They are nonbinding outlines paving the way for future legislation. Often, they only determine the amount of money that can be spent on departments' operating budgets that Congress must pass each year.
But they are an early measure of political strength. And especially in the first year of a presidency — when most of the heavy lifting is done on a president's agenda — they have far more importance.
Votes taken during budget resolution debates can put members on record in favor of particular policies — tax cuts or increases, cost curbs on federal health care programs, or welfare reform, for example. Presidents use political capital in winning such votes, and the lawmakers casting them tend to buy into the ideas involved.
At a comparable stage in 1981, Ronald Reagan broke the back of the Democratic House leadership in winning a key budget vote in favor of his tax cut agenda.
And in 1993, debate on Bill Clinton's deficit-cutting plan put his Democratic allies on record in support of higher taxes. That made subsequent votes to actually impose those tax hikes easier.
Budget resolutions also ratified a key 1990 budget pact between President George H.W. Bush and Democrats in which Bush broke his "read my lips" pledge not to raise taxes.
Key Senate budget votes in 2001 and 2003 limited the size of George W. Bush's tax cuts — but made sure they advanced.
To be sure, Obama's plans for global warming and health care are still so fuzzy that it's difficult to translate them into numbers in a congressional budget plan. And rather than overload Republicans now, it could make sense for Democrats to hold off on detailed assumptions in hopes of building bipartisan consensus later.
Still, the budget proposal that Obama sent to Congress in February did present some difficult choices:
_Fewer itemized tax deductions for the wealthy, providing money to help buy health care insurance for tens of millions of Americans who don't have it.
_Cuts in government payments to insurance companies and health care providers.
_An expensive and highly controversial plan to combat global warming through a "cap-and-trade" scheme that calls for auctioning off pollution permits for nearly $650 billion. The Senate, during budget debate Tuesday, voted to instead devote any revenues from the scheme to help consumers pay higher gasoline and electric bills that energy companies will pass on to them.
Both the House and Senate budget writers, for the most part, ignored all of Obama's big ideas when crafting their fiscal plans, sapping his agenda of momentum.
Indeed, key lawmakers are already playing "taps" over his proposals to chip away at wealthy people's ability to deduct charitable donations and mortgage interest at higher rates.
Instead, they designed a host of so-called reserve funds that give some modest procedural help to Obama initiatives but do nothing concrete to really advance them.
As a result, lawmakers can cast symbolic votes in favor of Obama's agenda — even if those votes don't say anything about the depth of that commitment. In fact, they can at the same time say they are voting for Obama's agenda even as they distance themselves from key elements of it, like his tax increases or the higher energy bills that would result from his global warming curbs.
The detail-free approach protects lawmakers from difficult votes. Its defenders also say it provides lawmakers with leeway when writing follow-up legislation.
"The strength of reserve funds, from my perspective, is you give the committees full flexibility to write the best legislation they can," Senate Budget Committee Chairman Kent Conrad told reporters.
But flexibility can also indicate a lack of direction. How will Democrats find $1 trillion or more over the next decade to pay for health care reforms? Is Obama's cap-and-trade initiative too unpopular to advance?
For now, there are only guesses.
"They're not putting their cards on the table," said GOP lobbyist Rich Meade. He knows how this works; he's a former staff director of the House Budget Committee.
EDITOR'S NOTE _ Andrew Taylor has covered Congress since 1990.
Sphere: Related Content
Showing posts with label Budget. Show all posts
Showing posts with label Budget. Show all posts
Wednesday, April 1, 2009
Monday, March 9, 2009
Business leery of Obama’s tax plans
By Kent Hoover
New Mexico Business Weekly
The nation’s most successful small business owners could pay higher taxes under President Obama’s budget plan.
The income of most small businesses is taxed at the individual level. The budget plan calls for increasing the top two tax rates to 36 percent and 39.6 percent in 2011, up from the current rates of 33 percent and 35 percent.
These higher-income taxpayers also would not receive the full value of their itemized deductions, and they would see their capital gains and dividends taxed at a 20 percent rate instead of 15 percent.
That’s bad news for small business owners who report more than $200,000 in income as individuals or more than $250,000 as joint filers.
Only 9 percent of taxpayers who report small business income make this much money, however, according to the Center on Budget and Policy Priorities. Plus many of these taxpayers are passive investors in small businesses, not owner/operators.
Most small business owners are middle-income individuals who would receive tax cuts under Obama’s budget and would benefit from his proposal for health care reform, said Robert Greenstein, the center’s executive director.
“In fact, small businesses would win under this budget,” Greenstein said.
Small business owners who make the most money, however, also are the most likely to invest in their businesses and hire additional workers, according to the U.S. Chamber of Commerce.
“If we take away their incentives to take risks, grow and succeed — as this budget does — we will be unnecessarily shooting ourselves in the foot,” said Bruce Josten, the chamber’s executive vice president for government affairs.
The effects of higher tax rates on business decisions “are almost theological questions,” said Clint Stretch, managing principal for tax policy at Deloitte Tax. Some business owners might decide not to expand as a result of higher taxes, but others might invest even more in their businesses so they can earn extra money to make up for the increased tax burden, he said.
The president’s budget plan also includes provisions that could hurt residential and commercial real estate. The limit on itemized deductions for upper-income taxpayers would reduce the value of the mortgage interest deduction for many homeowners, particularly in high-cost areas such as the Northeast and California.
The National Association of Realtors contends the proposal would hurt not only these taxpayers, but also home values across the board.
“There is never a good time to propose something that undermines the basic foundation of homeownership, but given our current housing crisis, this has to be the worst possible time,” said NAR President Charles McMillan, broker of record for Coldwell Banker Residential Brokerage in Irving, Texas.
Commercial real estate investors are concerned about Obama’s proposal to tax “carried interest” — a share of profits paid to managers of investment funds — as ordinary income instead of as capital gains. As a result, taxes on these payments could jump from the current 15 percent to as high as 39.6 percent. This change would apply not only to private equity firms and hedge funds, but also to 1.2 million real estate partnerships that own everything from office buildings to rental housing.
U.S.-based multinational corporations also would see higher taxes under the budget plan. The president proposes reforming laws that allow U.S.-based businesses to defer taxes on income earned abroad until they bring that money back to the U.S. Obama pledged to “end tax breaks for corporations that send jobs overseas.”
That’s “a great one-liner,” said Martin Regalia, chief economist for the U.S. Chamber of Commerce. The proposal, however, would make U.S.-based multinational corporations less competitive against their global rivals, he said. Most foreign-based companies are taxed only once, in the country where the income is earned. U.S.-based companies, on the other hand, are taxed twice on foreign profits — overseas and in the U.S. Allowing corporations to defer their U.S. taxes until they bring the money back to this country takes some of the sting out of this double taxation.
Ending this deferral “could really hurt businesses that are trying to expand outside of their current client base” into other countries, said Mike Metz, executive vice president of tax services at RSM McGladrey.
Tax plan for businesses
Under the budget plan proposed by President Barack Obama, business owners would see the following changes:
Tax increases
• Individual income tax rates would be increased for taxpayers with incomes above $200,000 (single filers) or $250,000 (families)
• The value of itemized deductions for these taxpayers would be reduced
• The tax rate for capital gains and dividends earned by these taxpayers would increase from 15 percent to 20 percent
• Carried interest earned by managers of investment partnerships would be taxed as ordinary income instead of as capital gains
• A company’s ability to defer U.S. taxes on income earned in other countries would be limited
Tax cuts
• The Making Work Pay tax cut ($400 for individuals, $800 for families) would be extended
• Capital gains on investments in small businesses would not be taxed beginning in 2014
• Middle-class taxpayers would get relief from alternative minimum tax
• Research and development tax credit would be made permanent
• More companies would be allowed to carry back net operating losses for five years Sphere: Related Content
New Mexico Business Weekly
The nation’s most successful small business owners could pay higher taxes under President Obama’s budget plan.
The income of most small businesses is taxed at the individual level. The budget plan calls for increasing the top two tax rates to 36 percent and 39.6 percent in 2011, up from the current rates of 33 percent and 35 percent.
These higher-income taxpayers also would not receive the full value of their itemized deductions, and they would see their capital gains and dividends taxed at a 20 percent rate instead of 15 percent.
That’s bad news for small business owners who report more than $200,000 in income as individuals or more than $250,000 as joint filers.
Only 9 percent of taxpayers who report small business income make this much money, however, according to the Center on Budget and Policy Priorities. Plus many of these taxpayers are passive investors in small businesses, not owner/operators.
Most small business owners are middle-income individuals who would receive tax cuts under Obama’s budget and would benefit from his proposal for health care reform, said Robert Greenstein, the center’s executive director.
“In fact, small businesses would win under this budget,” Greenstein said.
Small business owners who make the most money, however, also are the most likely to invest in their businesses and hire additional workers, according to the U.S. Chamber of Commerce.
“If we take away their incentives to take risks, grow and succeed — as this budget does — we will be unnecessarily shooting ourselves in the foot,” said Bruce Josten, the chamber’s executive vice president for government affairs.
The effects of higher tax rates on business decisions “are almost theological questions,” said Clint Stretch, managing principal for tax policy at Deloitte Tax. Some business owners might decide not to expand as a result of higher taxes, but others might invest even more in their businesses so they can earn extra money to make up for the increased tax burden, he said.
The president’s budget plan also includes provisions that could hurt residential and commercial real estate. The limit on itemized deductions for upper-income taxpayers would reduce the value of the mortgage interest deduction for many homeowners, particularly in high-cost areas such as the Northeast and California.
The National Association of Realtors contends the proposal would hurt not only these taxpayers, but also home values across the board.
“There is never a good time to propose something that undermines the basic foundation of homeownership, but given our current housing crisis, this has to be the worst possible time,” said NAR President Charles McMillan, broker of record for Coldwell Banker Residential Brokerage in Irving, Texas.
Commercial real estate investors are concerned about Obama’s proposal to tax “carried interest” — a share of profits paid to managers of investment funds — as ordinary income instead of as capital gains. As a result, taxes on these payments could jump from the current 15 percent to as high as 39.6 percent. This change would apply not only to private equity firms and hedge funds, but also to 1.2 million real estate partnerships that own everything from office buildings to rental housing.
U.S.-based multinational corporations also would see higher taxes under the budget plan. The president proposes reforming laws that allow U.S.-based businesses to defer taxes on income earned abroad until they bring that money back to the U.S. Obama pledged to “end tax breaks for corporations that send jobs overseas.”
That’s “a great one-liner,” said Martin Regalia, chief economist for the U.S. Chamber of Commerce. The proposal, however, would make U.S.-based multinational corporations less competitive against their global rivals, he said. Most foreign-based companies are taxed only once, in the country where the income is earned. U.S.-based companies, on the other hand, are taxed twice on foreign profits — overseas and in the U.S. Allowing corporations to defer their U.S. taxes until they bring the money back to this country takes some of the sting out of this double taxation.
Ending this deferral “could really hurt businesses that are trying to expand outside of their current client base” into other countries, said Mike Metz, executive vice president of tax services at RSM McGladrey.
Tax plan for businesses
Under the budget plan proposed by President Barack Obama, business owners would see the following changes:
Tax increases
• Individual income tax rates would be increased for taxpayers with incomes above $200,000 (single filers) or $250,000 (families)
• The value of itemized deductions for these taxpayers would be reduced
• The tax rate for capital gains and dividends earned by these taxpayers would increase from 15 percent to 20 percent
• Carried interest earned by managers of investment partnerships would be taxed as ordinary income instead of as capital gains
• A company’s ability to defer U.S. taxes on income earned in other countries would be limited
Tax cuts
• The Making Work Pay tax cut ($400 for individuals, $800 for families) would be extended
• Capital gains on investments in small businesses would not be taxed beginning in 2014
• Middle-class taxpayers would get relief from alternative minimum tax
• Research and development tax credit would be made permanent
• More companies would be allowed to carry back net operating losses for five years Sphere: Related Content
Tuesday, March 3, 2009
Candidate Obama vs. President Obama
By Ruth Marcus
Washington Post
One of the challenges for presidential candidates who turn into presidents is finding ways to wiggle out of unaffordable or ill-advised campaign positions without attracting too much notice.
President Obama managed to do this twice in his new budget: once explicitly, once by implication. Good for him, because both moves signal a better, more fiscally responsible approach.
The budget made a dramatic, smart and little-noticed pivot from his campaign-trail promise to cut taxes on 95 percent of Americans. Candidate Obama’s original plan -- a plan I criticized at the time as unduly expensive and poorly crafted -- provided for tax credits of $500 per individual or $1,000 per couple; couples making as much as $200,000 annually would qualify for a partial credit. The size of the credits was scaled back in the stimulus package, to $400 and $800. But the big switch came when now-President Obama released his budget last week. The “Making Work Pay” tax credits were there -- but for the first time they were contingent on revenue from auctioning permits in the administration’s proposed cap-and-trade program to alleviate climate change. In other words: no cap-and-trade, no tax credits.
This is extremely clever. A cap-and-trade regime is, in effect, a carbon tax, a penalty on pollution that would be passed along to ordinary Americans. It makes sense to require polluting industries to pay for the impact of their activities, and to give them the incentive to move to less polluting approaches. At the same time, it makes sense to alleviate the costs that would impose on individuals.
In fact, it makes so much sense that this is what Obama envisioned during the campaign. Back then, he promised to devote some cap-and-trade revenue to investing in alternative energy, and to save most of the rest “for rebates and other transition relief to ensure that families and communities are not adversely impacted by the transition to a new energy, low carbon economy.”
So the tax credit that Obama now promises to finance with cap and trade revenue replaces a rebate he already promised. Two proposed tax cuts have, in effect, been merged into one. An expensive tax credit is paid for with a valuable social program. Obama does not get dinged for abandoning an expensive and high-profile campaign promise, but he has managed to disappear a different one.
There was another potential pivot implicit in Obama’s health care proposal. He identified $634 billion in revenue over ten years to pay for the program, but he acknowledged that this would only cover about half the cost of universal coverage. Lawmakers working on the issue would have to come up with the rest.
For the Willie Suttons of health policy, there’s one obvious place to find that kind of money: the expensive, counter-productive, unfair and regressive preference for employer-provided health built into the tax code. Health care offered by employers is not considered part of workers’ taxable wages. This is expensive, costing about $200 billion a year. It is counter-productive because it encourages overconsumption of health care. It is unfair because those who must purchase insurance on their own generally do not receive special tax treatment. It is regressive because higher-income employees, who are taxed at higher brackets, receive a greater benefit from the exclusion.
On the other hand, there is the slight problem that when Republican nominee John McCain proposed to tax the value of employer-provided insurance, and instead to provide tax credits to buy insurance, Obama blasted him for seeking a $3.6 trillion tax hike on American workers, “the largest middle-class tax increase in history.” Hard to now turn around and endorse something similar.
Hence, the dog whistle of the Obama budget when it comes to paying for health care reform: You can't hear him saying "let's think about taxing employer-provided health care" unless your ear is turned to that pitch. Obama's budget does not make that proposal, but it is the predictable consequence of everything he lays out. If (a) health care should be financed in a deficit-neutral way and (b) more revenue is needed, then (c) cutting back in some way on the tax preference for employer-provided insurance cannot be far behind. It’s not exactly a profile in courage for Obama not to say this straight out. Yet the logic of his budget is that it implicitly signals an openness to doing so.
These are both good moves -- even if, in a political season, they might be labelled flip-flops. Sphere: Related Content
Washington Post
One of the challenges for presidential candidates who turn into presidents is finding ways to wiggle out of unaffordable or ill-advised campaign positions without attracting too much notice.
President Obama managed to do this twice in his new budget: once explicitly, once by implication. Good for him, because both moves signal a better, more fiscally responsible approach.
The budget made a dramatic, smart and little-noticed pivot from his campaign-trail promise to cut taxes on 95 percent of Americans. Candidate Obama’s original plan -- a plan I criticized at the time as unduly expensive and poorly crafted -- provided for tax credits of $500 per individual or $1,000 per couple; couples making as much as $200,000 annually would qualify for a partial credit. The size of the credits was scaled back in the stimulus package, to $400 and $800. But the big switch came when now-President Obama released his budget last week. The “Making Work Pay” tax credits were there -- but for the first time they were contingent on revenue from auctioning permits in the administration’s proposed cap-and-trade program to alleviate climate change. In other words: no cap-and-trade, no tax credits.
This is extremely clever. A cap-and-trade regime is, in effect, a carbon tax, a penalty on pollution that would be passed along to ordinary Americans. It makes sense to require polluting industries to pay for the impact of their activities, and to give them the incentive to move to less polluting approaches. At the same time, it makes sense to alleviate the costs that would impose on individuals.
In fact, it makes so much sense that this is what Obama envisioned during the campaign. Back then, he promised to devote some cap-and-trade revenue to investing in alternative energy, and to save most of the rest “for rebates and other transition relief to ensure that families and communities are not adversely impacted by the transition to a new energy, low carbon economy.”
So the tax credit that Obama now promises to finance with cap and trade revenue replaces a rebate he already promised. Two proposed tax cuts have, in effect, been merged into one. An expensive tax credit is paid for with a valuable social program. Obama does not get dinged for abandoning an expensive and high-profile campaign promise, but he has managed to disappear a different one.
There was another potential pivot implicit in Obama’s health care proposal. He identified $634 billion in revenue over ten years to pay for the program, but he acknowledged that this would only cover about half the cost of universal coverage. Lawmakers working on the issue would have to come up with the rest.
For the Willie Suttons of health policy, there’s one obvious place to find that kind of money: the expensive, counter-productive, unfair and regressive preference for employer-provided health built into the tax code. Health care offered by employers is not considered part of workers’ taxable wages. This is expensive, costing about $200 billion a year. It is counter-productive because it encourages overconsumption of health care. It is unfair because those who must purchase insurance on their own generally do not receive special tax treatment. It is regressive because higher-income employees, who are taxed at higher brackets, receive a greater benefit from the exclusion.
On the other hand, there is the slight problem that when Republican nominee John McCain proposed to tax the value of employer-provided insurance, and instead to provide tax credits to buy insurance, Obama blasted him for seeking a $3.6 trillion tax hike on American workers, “the largest middle-class tax increase in history.” Hard to now turn around and endorse something similar.
Hence, the dog whistle of the Obama budget when it comes to paying for health care reform: You can't hear him saying "let's think about taxing employer-provided health care" unless your ear is turned to that pitch. Obama's budget does not make that proposal, but it is the predictable consequence of everything he lays out. If (a) health care should be financed in a deficit-neutral way and (b) more revenue is needed, then (c) cutting back in some way on the tax preference for employer-provided insurance cannot be far behind. It’s not exactly a profile in courage for Obama not to say this straight out. Yet the logic of his budget is that it implicitly signals an openness to doing so.
These are both good moves -- even if, in a political season, they might be labelled flip-flops. Sphere: Related Content
Wednesday, February 25, 2009
GOP finds little common ground with Obama
They too call for fiscal responsibility but say they'll oppose Obama on most every issue.
By James Oliphant and Richard Simon
Los Angeles Times
Feb. 25, 2009
Reporting from Washington -- Following President Obama's call Tuesday evening for a return to fiscal responsibility, Republicans responded -- by demanding the country return to a policy of fiscal responsibility.
If that sounds like the two parties are on the same page at last, the GOP's actual message -- expressed most directly by Louisiana Gov. Bobby Jindal in the party's official response to Obama's speech -- was that the party was prepared to oppose the president's economic program at almost every turn.
"To solve our current problems, Washington must lead," Jindal said. "But the way to lead is not to raise taxes and put more money and power in the hands of Washington politicians."
Calling for traditional Republican policies of tax cuts, less government involvement and reliance on free markets and individual effort, Jindal said: "The strength of America is not found in our government. It is found in the compassionate hearts and enterprising spirit of our citizens."
Jindal and most other Republicans gave a nod to polls showing strong public support for the president on the economy, saying they wanted to work with him on what all agreed was the country's most pressing issue.
But they accused Obama -- and, more pointedly, Democrats in Congress -- of choosing the wrong tactics by backing programs that they said would increase taxes and concentrate power in Washington instead of in private hands.
Emerging from the House chamber where Obama delivered the address, Rep. Marsha Blackburn (R-Tenn.) was succinct: "Whether it is cap and trade, whether it is cradle-to-grave education, whether it is universal healthcare, the era of big government is here."
The Republicans' attempt to draw a contrast between the two major parties' visions for the country was complicated by Obama's repeated promises to eliminate waste, his assertion that he too favored smaller government, and his pledge to slice the federal deficit in half by the end of his first term.
The difference, Jindal and other Republicans said Tuesday, is that they wanted to spend even less than Democrats, except on defense. And, they said, they won't raise taxes to trim the deficit.
The Louisiana governor, considered a rising star who might run for president in 2012, recently said he may not accept a portion of money in the recent stimulus package set aside for Louisiana.
Jindal invoked his state's experience following Hurricane Katrina in support of Republican skepticism about government's ability to deal effectively with major national problems."
Today in Washington, some are promising that government will rescue us from the economic storms raging all around us. Those of us who lived through Hurricane Katrina, we have our doubts," he said.
Jindal, along with many Republicans in Congress, focused on the almost $1.5 trillion the government has recently committed for jump-starting the struggling economy and propping up ailing banks. The House will take up a mammoth spending bill today that was held over from the last session."
I enjoyed about half of the speech," said Rep. Dan Lungren (R-Gold River). "I enjoyed the president's rhetoric. I enjoyed his call for responsibility. I enjoyed his statement that we have to be concerned about [our] children and grandchildren's debt. It's with the background of him applauding everything that was in the stimulus package and evidently everything that is going to be in the omnibus -- the two just don't add up."
Rep. Eric Cantor (R-Va.), the House minority whip and the face of a new conservative insurgency in Washington, said his party wanted to work with the president, but "there are some principles by which we're going to operate in proffering our ideas to the president and frankly to our congressional colleagues on the other side of the aisle."
Cantor's remarks illustrated the gamble Republicans have taken in opposing Obama's economic initiatives, including the stimulus bill. A New York Times poll released Tuesday said that almost three-quarters of Americans polled believed the president had been trying to work with Republicans, but only about 30% think Republicans were trying to work with Democrats.
That may be why many Republicans continued their campaign to drive a wedge between the White House and Congress by praising Obama but suggesting that his goals will be frustrated by Democratic leaders on the Hill.
"Nice speech," said Sen. John Cornyn (R-Texas), after Obama concluded his address. But he said that Obama's call for bipartisanship "fell on deaf ears" with the congressional Democratic leadership.
"It's going to take him weighing in early to bring everybody to the table, because so far the Democratic leadership in the House and Senate haven't got the memo on bipartisanship," Cornyn said.
Rep. Kevin Brady (R-Texas), however, apparently had read that memo. He was giving Obama the benefit of the doubt. "I thought he was right on target on the issues -- energy, education, healthcare and housing. I just think the American public is just starved for details. When will we see results? Who's going to end up paying for all this?"
Given the fact that he's only been in office four weeks, I think the sooner he can fill in the blanks, the sooner we can get to work," Brady said. "Look, he deserves a fair chance to deliver on these issues. Where there's common ground, we ought to work together." Sphere: Related Content
By James Oliphant and Richard Simon
Los Angeles Times
Feb. 25, 2009
Reporting from Washington -- Following President Obama's call Tuesday evening for a return to fiscal responsibility, Republicans responded -- by demanding the country return to a policy of fiscal responsibility.
If that sounds like the two parties are on the same page at last, the GOP's actual message -- expressed most directly by Louisiana Gov. Bobby Jindal in the party's official response to Obama's speech -- was that the party was prepared to oppose the president's economic program at almost every turn.
"To solve our current problems, Washington must lead," Jindal said. "But the way to lead is not to raise taxes and put more money and power in the hands of Washington politicians."
Calling for traditional Republican policies of tax cuts, less government involvement and reliance on free markets and individual effort, Jindal said: "The strength of America is not found in our government. It is found in the compassionate hearts and enterprising spirit of our citizens."
Jindal and most other Republicans gave a nod to polls showing strong public support for the president on the economy, saying they wanted to work with him on what all agreed was the country's most pressing issue.
But they accused Obama -- and, more pointedly, Democrats in Congress -- of choosing the wrong tactics by backing programs that they said would increase taxes and concentrate power in Washington instead of in private hands.
Emerging from the House chamber where Obama delivered the address, Rep. Marsha Blackburn (R-Tenn.) was succinct: "Whether it is cap and trade, whether it is cradle-to-grave education, whether it is universal healthcare, the era of big government is here."
The Republicans' attempt to draw a contrast between the two major parties' visions for the country was complicated by Obama's repeated promises to eliminate waste, his assertion that he too favored smaller government, and his pledge to slice the federal deficit in half by the end of his first term.
The difference, Jindal and other Republicans said Tuesday, is that they wanted to spend even less than Democrats, except on defense. And, they said, they won't raise taxes to trim the deficit.
The Louisiana governor, considered a rising star who might run for president in 2012, recently said he may not accept a portion of money in the recent stimulus package set aside for Louisiana.
Jindal invoked his state's experience following Hurricane Katrina in support of Republican skepticism about government's ability to deal effectively with major national problems."
Today in Washington, some are promising that government will rescue us from the economic storms raging all around us. Those of us who lived through Hurricane Katrina, we have our doubts," he said.
Jindal, along with many Republicans in Congress, focused on the almost $1.5 trillion the government has recently committed for jump-starting the struggling economy and propping up ailing banks. The House will take up a mammoth spending bill today that was held over from the last session."
I enjoyed about half of the speech," said Rep. Dan Lungren (R-Gold River). "I enjoyed the president's rhetoric. I enjoyed his call for responsibility. I enjoyed his statement that we have to be concerned about [our] children and grandchildren's debt. It's with the background of him applauding everything that was in the stimulus package and evidently everything that is going to be in the omnibus -- the two just don't add up."
Rep. Eric Cantor (R-Va.), the House minority whip and the face of a new conservative insurgency in Washington, said his party wanted to work with the president, but "there are some principles by which we're going to operate in proffering our ideas to the president and frankly to our congressional colleagues on the other side of the aisle."
Cantor's remarks illustrated the gamble Republicans have taken in opposing Obama's economic initiatives, including the stimulus bill. A New York Times poll released Tuesday said that almost three-quarters of Americans polled believed the president had been trying to work with Republicans, but only about 30% think Republicans were trying to work with Democrats.
That may be why many Republicans continued their campaign to drive a wedge between the White House and Congress by praising Obama but suggesting that his goals will be frustrated by Democratic leaders on the Hill.
"Nice speech," said Sen. John Cornyn (R-Texas), after Obama concluded his address. But he said that Obama's call for bipartisanship "fell on deaf ears" with the congressional Democratic leadership.
"It's going to take him weighing in early to bring everybody to the table, because so far the Democratic leadership in the House and Senate haven't got the memo on bipartisanship," Cornyn said.
Rep. Kevin Brady (R-Texas), however, apparently had read that memo. He was giving Obama the benefit of the doubt. "I thought he was right on target on the issues -- energy, education, healthcare and housing. I just think the American public is just starved for details. When will we see results? Who's going to end up paying for all this?"
Given the fact that he's only been in office four weeks, I think the sooner he can fill in the blanks, the sooner we can get to work," Brady said. "Look, he deserves a fair chance to deliver on these issues. Where there's common ground, we ought to work together." Sphere: Related Content
Tuesday, February 24, 2009
GOP Gov. Jindal calls Obama's plan irresponsible
By CHARLES BABINGTON
Associated Press Writer
WASHINGTON – Republican leaders continued their attacks on President Barack Obama's handling of the economy Tuesday, calling it irresponsible and certain to increase taxes and federal debt.
Responding in advance to Obama's televised speech to a joint session of Congress, top Republicans said the president relies too heavily on spending, and not enough on tax cuts, to try to revive the gasping economy. They said they want to work with Obama, and sometimes blamed congressional Democrats more than him. But their criticisms were sharp and plentiful.
"The way to lead is not to raise taxes and put more money and power in hands of Washington politicians," Louisiana Gov. Bobby Jindal, who gave the Republican Party's official response, said in excerpts released early. The massive economic stimulus bill recently enacted by Obama and congressional Democrats, Jindal said, will expand the government, "increase our taxes down the line, and saddle future generations with debt."
"It's irresponsible," said Jindal, who is eyeing a presidential bid in 2012.
The tone of the Republicans' response was in keeping with their nearly unanimous opposition to the $787 billion economic stimulus bill, which was backed by only three Republicans in the Senate and none in the House. Some Democrats and independents think the Republicans are blundering and misreading most Americans' sentiments about the need for massive government action to help the economy.
In the latest New York Times/CBS News poll, about three-fourths said Obama was trying to be bipartisan, and almost as many faulted the response of Republican officials, which was seen as politically motivated.
Despite such findings, GOP lawmakers say they believe they will be proven right in the long run.
House Republican leader John Boehner of Ohio said Tuesday that Republicans want to help Obama find "responsible solutions to the challenges facing our nation, but thus far congressional leaders in the president's own party have stood in the way."
Boehner, Jindal and other Republicans repeatedly accused Democrats of wanting to raise taxes, but the Obama-backed stimulus package has extensive tax cuts.
Jindal acknowledged that to some degree, Republicans deserved the drubbing they took in the last two national elections.
"Our party got away from its principles," he said. "You elected Republicans to champion limited government, fiscal discipline, and personal responsibility. Instead, Republicans went along with earmarks and big government spending in Washington." But that is changing, he said.
Taking advantage of his moment in the national spotlight, Jindal publicized a Web link Tuesday (http://www.bobbyjindal.com/sotu/) allowing respondents to receive early excerpts of his planned televised response, and to donate to his political organization. Jindal also collected their e-mail and postal addresses, which could prove handy in a presidential race. Sphere: Related Content
Associated Press Writer
WASHINGTON – Republican leaders continued their attacks on President Barack Obama's handling of the economy Tuesday, calling it irresponsible and certain to increase taxes and federal debt.
Responding in advance to Obama's televised speech to a joint session of Congress, top Republicans said the president relies too heavily on spending, and not enough on tax cuts, to try to revive the gasping economy. They said they want to work with Obama, and sometimes blamed congressional Democrats more than him. But their criticisms were sharp and plentiful.
"The way to lead is not to raise taxes and put more money and power in hands of Washington politicians," Louisiana Gov. Bobby Jindal, who gave the Republican Party's official response, said in excerpts released early. The massive economic stimulus bill recently enacted by Obama and congressional Democrats, Jindal said, will expand the government, "increase our taxes down the line, and saddle future generations with debt."
"It's irresponsible," said Jindal, who is eyeing a presidential bid in 2012.
The tone of the Republicans' response was in keeping with their nearly unanimous opposition to the $787 billion economic stimulus bill, which was backed by only three Republicans in the Senate and none in the House. Some Democrats and independents think the Republicans are blundering and misreading most Americans' sentiments about the need for massive government action to help the economy.
In the latest New York Times/CBS News poll, about three-fourths said Obama was trying to be bipartisan, and almost as many faulted the response of Republican officials, which was seen as politically motivated.
Despite such findings, GOP lawmakers say they believe they will be proven right in the long run.
House Republican leader John Boehner of Ohio said Tuesday that Republicans want to help Obama find "responsible solutions to the challenges facing our nation, but thus far congressional leaders in the president's own party have stood in the way."
Boehner, Jindal and other Republicans repeatedly accused Democrats of wanting to raise taxes, but the Obama-backed stimulus package has extensive tax cuts.
Jindal acknowledged that to some degree, Republicans deserved the drubbing they took in the last two national elections.
"Our party got away from its principles," he said. "You elected Republicans to champion limited government, fiscal discipline, and personal responsibility. Instead, Republicans went along with earmarks and big government spending in Washington." But that is changing, he said.
Taking advantage of his moment in the national spotlight, Jindal publicized a Web link Tuesday (http://www.bobbyjindal.com/sotu/) allowing respondents to receive early excerpts of his planned televised response, and to donate to his political organization. Jindal also collected their e-mail and postal addresses, which could prove handy in a presidential race. Sphere: Related Content
Obama vows to lead US from dire 'day of reckoning'
By JENNIFER LOVEN
AP White House Correspondent
WASHINGTON – President Barack Obama promised a nation shuddering in economic crisis Tuesday night that he would lead it from a dire "day of reckoning" to a brighter future, summoning politicians and public alike to shoulder responsibility for hard choices and shared sacrifice. "The time to take charge of our future is here," Obama declared, delivering his first address to a joint session of Congress.
Offering words of reassurance to an anxious nation, he declared, "Tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before."
"We are a nation that has seen promise and peril," he said. "Now we must be that nation again."Cheered robustly as he entered the House chamber, Obama grinned, shook hands and kissed lawmakers and stopped for a lengthy embrace with Supreme Court Justice Ruth Bader Ginsburg, back on the bench only this week after surgery for pancreatic cancer.
To deal with the current crisis, deepening each day, the president said more money will be needed to rescue troubled banks beyond the $700 billion already committed last year. He said he knows that bailout billions for banks are unpopular — "I promise you, I get it," he said — but he also insisted that was the only way to get credit moving again to households and businesses, the lifeblood of the American economy.
Along with aid for banks, he also called on Congress to move quickly on legislation to overhaul outdated regulations on the nation's financial markets.
"I ask this Congress to join me in doing whatever proves necessary," Obama said. "Because we cannot consign our nation to an open-ended recession."
Thinking longer-term, Obama said in a speech lacking many specifics and devoid of initiatives that both political parties must give up favored programs while uniting behind his campaign promises to build better schools, expand health care coverage and move the nation to "greener" fuel use.
Just five weeks after his inauguration, Obama addressed an ebullient Democratic congressional majority and an embattled but reinvigorated GOP minority as well as millions of anxious viewers. Despite the nation's economic worries and the lack of support for his plans from all but a few Republican lawmakers, Obama enjoys strong approval ratings across the nation.
Louisiana's young, charismatic governor, Bobby Jindal, delivering the televised GOP response, exhorted fellow Republicans to be Obama's "strongest partners" when they agree with him. But he signaled that won't happen much, calling Democrats in Congress "irresponsible" for passing the $787 billion stimulus package that Republicans have criticized as excessive and wasteful.
"The way to lead is not to raise taxes and put more money and power in hands of Washington politicians," Jindal said, according to excerpts of his remarks released by the Republican Party. "Who among us would ask our children for a loan, so we could spend money we do not have, on things we do not need?"
Jindal is considered a likely presidential contender in 2012.
Obama spoke as bad economic news continued to pile up, felt all too keenly in U.S. homes and businesses. Some 3.6 million jobs have disappeared so far in the deepening recession, which now ranks as the biggest job destroyer in the post-World War II period. Americans have lost trillions of dollars in retirement, college and savings accounts, with the stock market falling nearly half from its peak of 16 months ago.
And new polls — some with his public support rising and others with it dropping — show that the political climate can be as precarious as the economic one. Aware that his and his party's fortunes will suffer if he cannot right the economic picture, Obama sought to blend the kind of grim honesty that has become his trademark since taking office with a greater emphasis on optimism.
"The weight of this crisis will not determine the destiny of this nation," he said.
The central argument of his speech was that his still-unfolding economic revival plan has room for — and even demands — simultaneous action on a broad, expensive agenda including helping the millions without health insurance, improving education and switching the U.S. to greater dependence on alternative energy sources. This is the big lift of his young presidency: bringing the public behind what are sure to be enormous outlays on contentious issues.
His hope was to begin to persuade the country that those longer-term items on his presidential agenda are as important to the nation's economic well-being as unchoking credit and turning around unemployment numbers.
"The only way this century will be another American century is if we confront at last the price of our dependence on oil and the high cost of health care, the schools that aren't preparing our children and the mountain of debt they stand to inherit," Obama said. "That is our responsibility."
He urged lawmakers to reduce emissions of greenhouse gases that cause climate change by creating a cap-and-trade system of limits and pollution allowances, especially for industries such as utilities with coal burning power plants. And he said the budget he is sending to Congress on Thursday will call for $15 billion a year in federal spending to spur development of environmentally friendly but so far cost-ineffective energy sources such as wind and solar, biofuels, clean coal and more fuel-efficient vehicles.
He said his budget request also will create new incentives for teacher performance and support for innovative education programs. He asked every American to commit to completing a year or more of higher education or career training.
New in office, he wasn't charged with producing a formal State of the Union status report. But for all intents and purposes, that's what it was: a night for the president to sketch out his priorities in a setting unmatched the rest of the year.
It took nearly 15 minutes for him to make his way through a House chamber packed with lawmakers eager to welcome the nation's first black president into a Capitol built by slaves. The gallery included a special section hosted by first lady Michelle Obama in which guests were selected to serve as living symbols of the president's goals. Cramming the floor was virtually the entire leadership of the federal government, including Supreme Court justices and all but one Cabinet member, held away in case disaster struck.
Pre-speech, Wall Street was in a better mood than it had been in for days: Stocks were up after Federal Reserve Chairman Ben Bernanke said the recession might end this year.
In contrast to many State of the Union addresses by George W. Bush, Obama did not emphasize foreign policy. He touched on his intention to chart new strategies in Iraq and Afghanistan and to forge a new image for the U.S. around the world even as he keeps up the fight against terrorism.
With the economy dominant, Obama said the mess was one he inherited. "We have lived through an era where too often, short-term gains were prized over long-term prosperity, where we failed to look beyond the next payment, the next quarter or the next election," he said.
He aimed to show he was tackling the situation with both urgency and strict oversight for how the staggering sums are being spent. The massive stimulus plan, an overhaul of the separate $700 billion bailout for the financial sector, and a $275 billion rescue for struggling homeowners are already in place, and more is on the way, Obama said.
Even as Washington pours money into the economic recovery, Obama said the budget deficit, at $1.3 trillion and ballooning, must be brought under control.
He promised he would slash it by half by the end of his term in 2013, mostly by ending U.S. combat in Iraq and eliminating some of Bush's tax cuts for the wealthy. He said his budget officials have identified a total of $2 trillion in savings over the next 10 years, also including ending education programs "that don't work" and payments to large agribusinesses "that don't need them," eliminating wasteful no-bid contracts in Iraq and spending on weapons systems no longer needed in the post-Cold War era, and rooting out waste in Medicare.
"Everyone in this chamber, Democrats and Republicans, will have to sacrifice some worthy priorities for which there are no dollars," he said. "And that includes me."
He touted his decision to end the practice of leaving Iraq and Afghanistan war spending out of the main budget. "For seven years, we have been a nation at war. No longer will we hide its price," Obama said. Sphere: Related Content
AP White House Correspondent
WASHINGTON – President Barack Obama promised a nation shuddering in economic crisis Tuesday night that he would lead it from a dire "day of reckoning" to a brighter future, summoning politicians and public alike to shoulder responsibility for hard choices and shared sacrifice. "The time to take charge of our future is here," Obama declared, delivering his first address to a joint session of Congress.
Offering words of reassurance to an anxious nation, he declared, "Tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before."
"We are a nation that has seen promise and peril," he said. "Now we must be that nation again."Cheered robustly as he entered the House chamber, Obama grinned, shook hands and kissed lawmakers and stopped for a lengthy embrace with Supreme Court Justice Ruth Bader Ginsburg, back on the bench only this week after surgery for pancreatic cancer.
To deal with the current crisis, deepening each day, the president said more money will be needed to rescue troubled banks beyond the $700 billion already committed last year. He said he knows that bailout billions for banks are unpopular — "I promise you, I get it," he said — but he also insisted that was the only way to get credit moving again to households and businesses, the lifeblood of the American economy.
Along with aid for banks, he also called on Congress to move quickly on legislation to overhaul outdated regulations on the nation's financial markets.
"I ask this Congress to join me in doing whatever proves necessary," Obama said. "Because we cannot consign our nation to an open-ended recession."
Thinking longer-term, Obama said in a speech lacking many specifics and devoid of initiatives that both political parties must give up favored programs while uniting behind his campaign promises to build better schools, expand health care coverage and move the nation to "greener" fuel use.
Just five weeks after his inauguration, Obama addressed an ebullient Democratic congressional majority and an embattled but reinvigorated GOP minority as well as millions of anxious viewers. Despite the nation's economic worries and the lack of support for his plans from all but a few Republican lawmakers, Obama enjoys strong approval ratings across the nation.
Louisiana's young, charismatic governor, Bobby Jindal, delivering the televised GOP response, exhorted fellow Republicans to be Obama's "strongest partners" when they agree with him. But he signaled that won't happen much, calling Democrats in Congress "irresponsible" for passing the $787 billion stimulus package that Republicans have criticized as excessive and wasteful.
"The way to lead is not to raise taxes and put more money and power in hands of Washington politicians," Jindal said, according to excerpts of his remarks released by the Republican Party. "Who among us would ask our children for a loan, so we could spend money we do not have, on things we do not need?"
Jindal is considered a likely presidential contender in 2012.
Obama spoke as bad economic news continued to pile up, felt all too keenly in U.S. homes and businesses. Some 3.6 million jobs have disappeared so far in the deepening recession, which now ranks as the biggest job destroyer in the post-World War II period. Americans have lost trillions of dollars in retirement, college and savings accounts, with the stock market falling nearly half from its peak of 16 months ago.
And new polls — some with his public support rising and others with it dropping — show that the political climate can be as precarious as the economic one. Aware that his and his party's fortunes will suffer if he cannot right the economic picture, Obama sought to blend the kind of grim honesty that has become his trademark since taking office with a greater emphasis on optimism.
"The weight of this crisis will not determine the destiny of this nation," he said.
The central argument of his speech was that his still-unfolding economic revival plan has room for — and even demands — simultaneous action on a broad, expensive agenda including helping the millions without health insurance, improving education and switching the U.S. to greater dependence on alternative energy sources. This is the big lift of his young presidency: bringing the public behind what are sure to be enormous outlays on contentious issues.
His hope was to begin to persuade the country that those longer-term items on his presidential agenda are as important to the nation's economic well-being as unchoking credit and turning around unemployment numbers.
"The only way this century will be another American century is if we confront at last the price of our dependence on oil and the high cost of health care, the schools that aren't preparing our children and the mountain of debt they stand to inherit," Obama said. "That is our responsibility."
He urged lawmakers to reduce emissions of greenhouse gases that cause climate change by creating a cap-and-trade system of limits and pollution allowances, especially for industries such as utilities with coal burning power plants. And he said the budget he is sending to Congress on Thursday will call for $15 billion a year in federal spending to spur development of environmentally friendly but so far cost-ineffective energy sources such as wind and solar, biofuels, clean coal and more fuel-efficient vehicles.
He said his budget request also will create new incentives for teacher performance and support for innovative education programs. He asked every American to commit to completing a year or more of higher education or career training.
New in office, he wasn't charged with producing a formal State of the Union status report. But for all intents and purposes, that's what it was: a night for the president to sketch out his priorities in a setting unmatched the rest of the year.
It took nearly 15 minutes for him to make his way through a House chamber packed with lawmakers eager to welcome the nation's first black president into a Capitol built by slaves. The gallery included a special section hosted by first lady Michelle Obama in which guests were selected to serve as living symbols of the president's goals. Cramming the floor was virtually the entire leadership of the federal government, including Supreme Court justices and all but one Cabinet member, held away in case disaster struck.
Pre-speech, Wall Street was in a better mood than it had been in for days: Stocks were up after Federal Reserve Chairman Ben Bernanke said the recession might end this year.
In contrast to many State of the Union addresses by George W. Bush, Obama did not emphasize foreign policy. He touched on his intention to chart new strategies in Iraq and Afghanistan and to forge a new image for the U.S. around the world even as he keeps up the fight against terrorism.
With the economy dominant, Obama said the mess was one he inherited. "We have lived through an era where too often, short-term gains were prized over long-term prosperity, where we failed to look beyond the next payment, the next quarter or the next election," he said.
He aimed to show he was tackling the situation with both urgency and strict oversight for how the staggering sums are being spent. The massive stimulus plan, an overhaul of the separate $700 billion bailout for the financial sector, and a $275 billion rescue for struggling homeowners are already in place, and more is on the way, Obama said.
Even as Washington pours money into the economic recovery, Obama said the budget deficit, at $1.3 trillion and ballooning, must be brought under control.
He promised he would slash it by half by the end of his term in 2013, mostly by ending U.S. combat in Iraq and eliminating some of Bush's tax cuts for the wealthy. He said his budget officials have identified a total of $2 trillion in savings over the next 10 years, also including ending education programs "that don't work" and payments to large agribusinesses "that don't need them," eliminating wasteful no-bid contracts in Iraq and spending on weapons systems no longer needed in the post-Cold War era, and rooting out waste in Medicare.
"Everyone in this chamber, Democrats and Republicans, will have to sacrifice some worthy priorities for which there are no dollars," he said. "And that includes me."
He touted his decision to end the practice of leaving Iraq and Afghanistan war spending out of the main budget. "For seven years, we have been a nation at war. No longer will we hide its price," Obama said. Sphere: Related Content
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