Economic Recovery Measures
Start with a basic question: Do you think politicians are better at cutting taxes and increasing spending, or the reverse? The answer should help you to determine whether to worry more about politicians doing too little to stimulate the economy or too little to control the debt.
Lawmakers have railed against the inability to stop the leaking of oil into the Gulf of Mexico, yet they are having no better success in staunching the flow of red ink. Congress needs its own containment cap to suppress spending and tax cuts that are deficit-financed.
Washington Post Editorial: Economic stimulus plans ought to specify how the borrowed money gets repaid
Making the Pitch – With much of Washington eagerly anticipating the debut of Stephen Strasburg on the mound tomorrow, the return of Congress this week is an afterthought to many. But Pelosi, Reid and the rest of the Congressional rotation will need to have some pretty good stuff when they take the mound on Capitol Hill and face an opposing legislative line-up. They will have to show a lot of range as they pitch both economic stimulus and fiscal responsibility.
Yes, today’s employment news from May is disappointing – even though there are some encouraging signs.
Let’s start with the bright side: the unemployment rate edged down (to 9.7% from 9.9% in April, a lot better than the 10.1% high of last October); job creation was positive for the fifth month in a row (it has been increasingly positive every month this year); and the job number was what we like to hear (+431,000). So, more people are working now.
According to a new CBO report, automatic stabilizers added about $282 billion to the federal deficit last year and are projected to add $351 billion this year and $403 billion in 2011 before settling back down at $29 billion in 2014.
Here are the highlights from this weekend’s editorials on fiscal and budget policy:
The House today passed a one-year extension of various tax breaks as well as expanded unemployment benefits until November on a 215-204 vote. In a separate 245-171 vote it approved a patch to the Medicare “doc fix” through 2011. However, the Senate adjourned without considering the legislation, meaning that the unemployment benefits, doc fix and COBRA subsidies will expire while Congress is in recess. Marking the second time this year Congress has left town without extending these provisions.
Two massive spending bills that congressional leaders wanted to dispose of before hitting the road for Memorial Day have hit potholes as lawmakers grow more uneasy about deficit spending. However, proposals to assert some degree of fiscal responsibility have yet to leave the driveway.