December 10, 2019

New York Times/CBS Poll: Unity on Issues Falls to Politics

That disconnect could explain why Democrats and Mr. Obama are still struggling to translate public support into tangible political backing for their initiatives. Americans did not give Mr. Obama high marks for his handling of those issues — even though more than two-thirds of Americans over all, including a majority of Republicans, disapprove of the way Republicans in Congress are handling their job.

“I’m for stricter gun laws, but the reason I favor the Republicans over the Democrats and the liberals on gun laws is because they have always been against the Second Amendment and the right to own guns,” said Jim Hensley, 69, a Republican from Grandville, Mich., in an interview after the poll was conducted.

“Yes, I believe the Republicans should have voted for background checks, and they should not legalize automatic weapons,” Mr. Hensley added. “I was against the repeal of the ban on automatic weapons, and I don’t support the N.R.A. But it’s like marriage. You stick with your wife no matter what, and you don’t just ditch your political party on one issue.”

Two weeks after a bipartisan measure that would have expanded background checks for gun buyers was defeated in the Senate, nearly 9 in 10 of those surveyed said they favored background checks on all gun buyers, and 6 in 10 said they were disappointed or angry with the vote.

On immigration, 83 percent of respondents said they supported a path to citizenship for the 11 million immigrants already in the country illegally, as long as certain requirements — like paying fines and back taxes, passing a criminal-background check and learning English — were met. And nearly 6 in 10 favored a combination of cutting spending and raising taxes to reduce the federal deficit, echoing the plans being pushed by Mr. Obama and Congressional Democrats.

Yet Americans are closely divided on whether Republicans would handle these issues better than Mr. Obama, the poll showed.

Both stricter gun laws and an immigration overhaul received strong support from Republicans, with 86 percent favoring background checks on all potential gun buyers, and 83 percent favoring a path to citizenship if certain requirements were met. Last month, a bipartisan group of eight senators proposed such immigration legislation, which would offer a 13-year path to citizenship, as well as require certain border security measures.

Only 41 percent of those surveyed approved of Mr. Obama’s handling of gun policy, and 52 percent disapproved. Americans were about evenly divided on whom to trust to make decisions about gun laws and an immigration overhaul — Republicans in Congress or the president.

Rick Buckman, 52, a Republican and an electrical engineer from Dallas, Pa., said that while he supported stricter gun legislation, he did not necessarily approve of the president’s approach. “I was really ticked off that the law didn’t pass,” Mr. Buckman said. “But I thought it was wrong of President Obama to get in front of the public and use people who had been damaged by gun violence as props.”

Mike Brady, 68, a Democrat and semiretired lawyer in Farmington Hills, Mich., viewed the Republicans’ opposition to the gun control legislation as self-serving. “Well, Obama’s trying his best to do the obvious right thing for the country, but he’s been roadblocked extensively for political reasons by people who even among themselves would take a different position,” he said. “So it’s cynical, unprincipled obstructionism.”

The poll also showed that 57 percent disapproved of Mr. Obama’s handling of the federal budget deficit. Thirty-six percent of respondents supported reducing the deficit by cutting federal spending.

Though churning support for his agenda remains a problem for the president, according to the poll, Congress is struggling with overcoming its own unfavorable image. Three-quarters of Americans disapprove of the way Congress is handling its job, the poll found, and nearly 9 in 10 said most members of Congress were more concerned with serving special interest groups than helping the people they represent.

“It’s like the gladiator sports, where the emperor keeps the people entertained, even though we’re starving,” said Roberta Hughes, 61, of Elizabeth City, N.C. “But real people are losing out in real ways when they enact the drama.”

The nationwide poll of 965 adults was conducted from April 24 to April 28 on land lines and cellular phones, with a margin of sampling error of plus or minus three percentage points.

Nearly 6 in 10 Americans said they would vote for a candidate who did not share their views of immigration. Only 4 in 10 said they would vote for a candidate who did not share their views on gun control — seemingly making immigration a less controversial issue at the voting booth, for now, than gun legislation.

“Stricter gun laws might help with some of the out of control people who randomly go around shooting others or killing themselves,” said Debby Warnock, 44, an independent from Pueblo West, Colo. “I do favor background checks, though some of the people who have killed others had clean backgrounds.”

She added: “I personally don’t care whether Republicans or Democrats make the decisions as long as it’s in the best interest of our country.”

Megan Thee-Brenan, Dalia Sussman and Marina Stefan contributed reporting.

Article source: http://www.nytimes.com/2013/05/02/us/politics/poll-finds-strong-support-for-tightened-gun-laws-and-path-to-citizenship.html?partner=rss&emc=rss

Bing Sees Progress on Detroit’s Debt

“The picture is not all doom and gloom,” Mr. Bing said in his annual State of the City address. “Every day there is more hope and possibilities. Like many Detroiters, I, too, am a fighter. We can’t, and won’t, give up on our city.”

For years, Detroit has wrestled with financial problems, partly the result of a shrinking tax base caused by a shrinking population. But city officials say they have made a series of spending cuts in recent months — including furloughs and layoffs — aimed at avoiding an immediate cash shortfall. Less than 9,700 city workers remain on the job, more than a thousand fewer than were on the city’s payroll last June, saving about $50 million annually, the city says. And Mr. Bing’s administration says it has reduced spending to $1.1 billion in the 2013 fiscal year from $1.4 billion in 2009.

Whether that will be enough to satisfy state officials, who are awaiting a review of the city’s finances this month, is uncertain. Among the troubles for Detroit — once the nation’s fourth-largest city, now 18th — is its long-term debt, estimated in 2011 at more than $12 billion by state officials.

If the review of Detroit finds the city’s circumstances dire, state officials could soon appoint an emergency financial manager who would have relatively broad powers to remake the city’s budget. “The options — they aren’t pretty,” Mr. Bing, who has yet to say whether he will seek re-election this year, said in his address. “But the consequences are even less attractive.”

Detroit leaders have long said they would prefer to solve their city’s problems on their own, and the prospect of an outside manager is freighted with political tensions between state leaders, dominated by Republicans, and those in the city, most of whom are Democrats. Still, Gov. Rick Snyder has been considering a pool of possible candidates for the emergency manager job should that become necessary, his office said this week.

Around the country, states have used a variety of approaches — from appointed receivers to oversight boards — to step in when cities are running into severe financial trouble. A financial control board helped New York City regain its footing in the 1970s. Still, the role and authority of such bodies range widely, as do opinions about whether they ultimately work. And Detroit had already been overseen by a financial advisory board that includes state officials, under an agreement reached with the state last year as the city tried then to avoid an outside manager.

Under Michigan law, an outside manager could eventually help lead a financially troubled city into bankruptcy proceedings, an outcome that few in Detroit or Lansing, the capital, see as wise or likely but that some have come to talk about as a real consideration.

If Detroit were eventually to pursue a bankruptcy filing, it would be the most populous American city to do so, and it would amount to the nation’s largest municipal bankruptcy in terms of its size of debt. Bankruptcy filings, known as Chapter 9 for such entities, are rare, complicated, slow and expensive, experts say. States like Michigan have a say in whether a municipality can pursue bankruptcy in the first place, and they have plenty of reasons to avoid such an outcome.

Since the 1930s, 643 government entities — and mostly small taxing authorities rather than major cities — have filed for Chapter 9 bankruptcy, and James E. Spiotto, a municipal bankruptcy expert at Chapman Cutler, a law firm in Chicago, cautioned that such a move by Michigan’s largest city would create all sorts of troubles, in terms of uncertainty, stigma and economic development.

“Chapter 9 is not a solution, it’s a process,” Mr. Spiotto said. “And it’s one that is going to have ripple effects for surrounding communities and the rest of the state. It was always intended to be the last, last resort.”

Article source: http://www.nytimes.com/2013/02/14/us/bing-sees-progress-on-detroits-debt.html?partner=rss&emc=rss

Traders Take Profits After Rally

Opinion »

Editorial: Fiscal Battles Ahead

The unwillingness of House Republicans to work for the common good suggests that the 113th Congress will be bitterly unproductive.

Article source: http://www.nytimes.com/2013/01/04/business/daily-stock-market-activity.html?partner=rss&emc=rss

News Analysis: Even After Victory, President Remains Constrained by G.O.P.

But if anything has been learned since then, it’s that the president’s power in Washington remains severely constrained by a Republican opposition establishment that is bitter about its losses, unmoved by Mr. Obama’s victory and unwilling to compromise on social policy, economics or foreign affairs. House Republicans, in particular, argue that they won elections as well and they see their ability to retain control of the House as granting them the right to stick to their own views even when they clash strongly with the president’s.

Friday’s pre-Christmas wrangling in the nation’s Capitol crystalized the challenges that Mr. Obama faces as he prepares to begin a second term next month.

In House Speaker John A. Boehner, the president has a deal-making partner who is unable to rally House Republicans behind his own plans, much less any deal he might cut with Mr. Obama. In a news conference Friday morning, Mr. Boehner essentially admitted he was running out of ideas to avert big tax increases and spending cuts early next year.

“How we get there,” Mr. Boehner told reporters, “God only knows.”

Across town just minutes later, officials with the National Rifle Association made clear what House Republicans had been whispering all week: the president’s call for gun control in the wake of the Connecticut shooting will run into tremendous opposition.

Wayne LaPierre, the executive vice president of the firearm group, made clear the N.R.A. would not support the president’s call for gun control, recommending instead a “school shield” program of armed security guards at the nation’s schools as well as a national database that could track the mentally ill.

“The only thing that stops a bad guy with a gun is a good guy with a gun,” Mr. LaPierre said at a news conference that was interrupted by protests and allowed no questions from reporters.

At the same time, the White House said on Friday that it would officially name Senator John Kerry of Massachusetts as Mr. Obama’s choice to lead the State Department — a decision Mr. Obama was forced to make after Republicans effectively blocked his preferred choice, Susan E. Rice, the ambassador to the United Nations.

Ms. Rice, a longtime confidante of Mr. Obama’s, was never formally nominated, but it was no secret inside the White House that the president would have liked her to succeed Hillary Rodham Clinton early next year. But even on the heels of his electoral victory, Mr. Obama was unable to overcome Republican opposition — led by Senator John McCain — to her nomination.

Polls suggest that Mr. Obama’s popularity has surged to its highest point since announcing the killing of Osama bin Laden. In the latest CBS News poll, the president’s job approval rating was at 57 percent.

But taken together, the events of the last five weeks suggest that even that improvement in the polls has done little to deliver the president the kind of clear authority to enact his policies that voters seemed to say they wanted during the election.

Even some of the president’s closest advisers said they were surprised by the ferocity of the Republican opposition.

“It’s kind of a stunning thing to watch the way this has unfolded, at least to date,” said David Axelrod, one of Mr. Obama’s longtime advisers. “The question is, how do you break free from these strident voices?”

Mr. Axelrod said that the election appeared to have had no effect on the president’s most committed adversaries in the Republican House, many of whom remain committed to blocking his every move.

“You have got members of Congress who are simply unwilling to compromise and unwilling to yield to either the will of the American people or the demands of the moment,” Mr. Axelrod said.

That may yet change.

There are still 10 days left in which Mr. Obama might reach some sort of arrangement with Congress on averting a fiscal crisis that some predict could plunge the nation back into recession. The White House says it remains hopeful.

In another 31 days, Mr. Obama will deliver his second inaugural address, providing him the opportunity to make his case to the American public on the direction he wants to take them in a second term.

A few weeks after that, he will give his State of the Union address, which he has already promised to use as a call for new gun control laws.

Those opportunities could provide the president with fresh political momentum in the new year.

He will need it. Whatever happens during the remainder of December, Mr. Obama will face economic challenges starting in January, including the likelihood of an extended debate with Republicans over how to overhaul the nation’s tax code.

The president’s team will need to shepherd Mr. Kerry through the Senate, past what appears to be minimal Republican opposition. But his nominees for other posts — including, perhaps, Chuck Hagel, the former senator from Nebraska, to be secretary of defense — may face tougher questions.

The gun control fight he has promised to wage will also compete for time and energy with a battle over comprehensive immigration reform, which he has also said he wants to begin early next year.

In a news conference on Wednesday, Mr. Obama expressed hope about finding ways to compromise with his adversaries but also lamented the opposition that he faces in Republicans.

“They keep on finding ways to say no, as opposed to finding ways to say yes,” Mr. Obama said on the tax and spending fight. On the subject of guns, he acknowledged the challenge of pursuing gun control in the face of political opposition from those same Reublicans.

“It won’t be easy,” he said.

Article source: http://www.nytimes.com/2012/12/22/us/politics/even-after-victory-president-remains-constrained-by-gop.html?partner=rss&emc=rss

Boehner Invokes ‘Plan B,’ Dismissing Obama’s Offer

The move came less than 24 hours after President Obama offered a more comprehensive deal that would raise tax rates on income over $400,000, raise $1.2 trillion in new revenue and cut $930 billion in spending over 10 years. Mr. Boehner declared that unbalanced and insufficient.

“What we’ve offered meets the definition of a balanced approach, but the president is not there yet,” Mr. Boehner said Tuesday.

The speaker made it clear he would continue negotiating with the president, and some House Republicans emerged from a closed-door meeting with Mr. Boehner confident that a deal was now in reach.

“We’re getting there,” said Representative James B. Renacci, Republican of Ohio.

But to raise the pressure, House leaders will proceed with what they are calling “Plan B,” which could come to a vote as early as Thursday. Under that plan, the House would take up tax legislation and consider two amendments. The first would mirror a bill passed by the Senate that would extend expiring Bush-era tax cuts for income below $250,000. That would be expected to fail, showing the president that his initial offer could not pass. A second amendment would raise that threshold to income below $1 million. The House may also vote on some middle ground, like the president’s $400,000 threshold.

Mr. Boehner told his conference that he would also like the bill to include provisions preventing the existing alternative minimum tax from expanding more to affect the middle class and extending existing tax rates on inherited estates.

But he said the bill would not cancel across-the-board spending cuts, known as sequestration, that would total $110 billion in 2013 and more than $1 trillion over 10 years.

Republicans would then resume the fight over broad spending cuts — especially to entitlement programs like Medicare — in late January or February, when the government must raise its borrowing limit, which many Republicans believe will give them much more leverage than they have now.

Mr. Boehner told Republicans on Tuesday: “Taxes are going up on everyone on Jan. 1. They’re baked into current law. And we have to stop whatever tax rate increases we can. In the absence of an alternative, as of this morning, a ‘modified Plan B’ is the plan.”

Representative Kevin McCarthy of California, the Republican whip, said his operation would be checking whether the party had the votes to pass any tax legislation. If Democrats stay united against the $1 million threshold, it could fail because some Republicans are unlikely to ever vote for a tax increase. Representative Nancy Pelosi of California, the Democratic leader, met with House Democrats on Tuesday and urged unity against the speaker’s plan.

The White House came out strongly against the speaker’s move. The White House press secretary, Jay Carney, said “Plan B” could not pass the Senate and “therefore will not protect middle-class families” from large tax increases beginning Jan. 1.

“The president has put a balanced, reasonable proposal on the table that achieves significant deficit reduction and reflects real compromise by meeting the Republicans halfway on revenue and more than halfway on spending from where each side started,” he said. “That is the essence of compromise.”

It is not clear how much this alternative plan is real or a bargaining tactic to extract more concessions from Mr. Obama. Rob Nabors, the president’s chief liaison to Congress, met with House Democrats on Tuesday and said talks were moving forward. But privately, he expressed pessimism that Mr. Boehner could sign on to any deal, according to people familiar with those conversations.

In spite of statements to the contrary just a week ago, House Republicans on Tuesday seemed almost uniformly resigned to some sort of tax rate increases on the nation’s highest earners, though they remained committed to keeping that group as small as possible. “The principle of trying to limit the increases is a good one,” said Representative Jason Chaffetz of Utah. “But now we’ve got to see more spending cuts.”

Jennifer Steinhauer contributed reporting.

Article source: http://www.nytimes.com/2012/12/19/us/politics/backing-off-deal-boehner-invokes-plan-b-on-taxes.html?partner=rss&emc=rss

Today’s Economist: Simon Johnson: The Real Fiscal Risks in the United States

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Simon Johnson is the Ronald A. Kurtz Professor of Entrepreneurship at the M.I.T. Sloan School of Management.

A great deal of attention is currently focused on the notion that a “fiscal cliff” of higher taxes and spending cuts awaits at the end of this year. The good news is that politicians are finally talking about the budget – and working hard to communicate their competing messages regarding what should be done to put public finance on a more sustainable footing.

Today’s Economist

Perspectives from expert contributors.

The bad news is that almost the entire national conversation on deficits and debts misses the real fiscal risks that we face.

There are three major issues.

First, the main risk is that in the near future the government will do too little by way of fiscal adjustment.

The drama of the word “cliff” and the image of falling off it makes things seem more worse than they are. To be sure, if all the scheduled tax increases and spending cuts go into effect, 2013 would be a difficult year – although there is no sign that this kind of fiscal adjustment would lead to the problems of the financial crisis of 2008.

The politicians will do a deal. Probably not now, when the Republicans are pressed to raise tax rates – this goes too deeply against what has become an ideology over the last 30 years.

It will be much easier to reach an agreement in January or February, when tax rates have gone up — which they will do automatically, if there is no agreement by Dec. 31 – and the Republicans are being asked to vote for what would presumably include cutting tax rates for middle-class Americans relative to those new levels.

But the deal to be struck between the White House and the Republican House will probably be too small to adequately address our fiscal issues.

If we want to start putting federal government debt on a more sustainable path, we should find a path to fiscal adjustment that undoes the net effect on the budget of the George W. Bush-era tax cuts, which represent about $4 trillion over the next 10 years. You can do that through revenue or through spending reductions, but that is the right goal to aim for – putting our federal finances back closer to where they were in the late 1990s. (For a primer, I recommend this piece by my colleague James Kwak.)

Such a change would put government debt on track to stabilize around 40 to 50 percent of gross domestic product by 2030 – an entirely reasonable and responsible goal. (In “White House Burning: The Founding Fathers, Our National Debt, and Why It Matters to You,” James and I run through alternative scenarios and discuss the policy options. You can tweak the numbers up or down somewhat, but the most important goal is to take debt off its current explosive path.)

President Obama has suggested a headline number for fiscal adjustment of $1.6 trillion, while the recent Republicans counterbid was $800 billion – both over 10 years (a standard accounting convention for this kind of discussion.)

Irrespective of how you feel about the policy combination each side is proposing, the “big numbers” are too small.

The United States doesn’t need to do more immediately. In contrast to many parts of Europe, we have some time to make our fiscal adjustments – particularly while interest rates remain low. The country should phase in a big part of its needed fiscal adjustment as the economy recovers. For example, part of any budget adjustment should be linked to employment relative to G.D.P. – any tax cuts in the new year could be phased out as the economy recovers.

Second, the working assumption of all American politicians is that the dollar will remain the predominant reserve currency indefinitely – the United States is the safe haven for investors and governments around the world. They particularly regard United States government debt as a safe asset in troubled times – and this is what allows us to borrow so much at low interest rates. (For a brief history of public debt in the United States – including how it has been useful in the past and how overreliance on foreign borrowing now makes us vulnerable, see the PBS NewsHour profile of “White House Burning.”)

About half of all federal government debt outstanding is held by foreigners. Sooner or later, foreigners will want to buy less United States debt. Either they will want to hold other assets – the fashion in currencies comes and goes over time, just like everything else – or they will save less (in which case they may hold onto their existing United States government debt but not want to buy so much of new issues).

Many countries hold their foreign reserves in dollars and have built these up over time. China, for example, holds over $1 trillion (the exact number is not public information; some people say the true number is significantly higher). This is far more than China needs, and it is no surprise that its interest in buying more United States Treasury debt is waning (see the latest official data).

No American politician wants to talk in public about what the implications of shifts in China’s savings and investments would be on our ability to finance federal government debt at reasonable interest rates. The middle class will pay more tax or receive fewer benefits, or both, over the coming decades – that’s the inconvenient math of the Congressional Budget Office. Which politician wants to level with voters on the scale of this issue?

The third risk is that our process of fiscal adjustment will undermine social insurance, primarily Social Security and Medicare.

We insure each other against outliving our assets and encountering an expensive version of ill health in old age. This insurance is mostly run through the federal government, for one simple reason. There was no private insurance market for older Americans before Medicare was created – and there will be none if Medicare is phased out or withers.

The most likely situation is this. After much shouting, a fiscal deal is reached in the new year – with a headline adjustment of around $1 trillion over 10 years, and perhaps with a 50-50 split between tax increases and spending cuts. Public attention recedes. Commentators proclaim that the budget problem has been fixed.

But then we hit a real fiscal crisis, with foreigners declining to buy newly issued Treasury paper and interest rates on that debt – and interest rates more broadly throughout the economy – rising sharply. The Federal Reserve fights to keep interest rates down, but its monetary policy in that instance is regarded as inflationary, further destabilizing the situation.

That crisis – date unknown but intense for sure – forces much more damaging fiscal cuts, including cuts in Medicare but also across the board (and bringing higher taxes). This is exactly the kind of disruptive fiscal austerity that damages an economy. One such dramatic, even humiliating, potential scenario is described in gripping detail in the opening pages of “Eclipse” by Arvind Subramanian (my colleague at the Peterson Institute for International Economics).

We end up poorer, more unequal and struggling to remember how we ever cared for one another in old age.

Article source: http://economix.blogs.nytimes.com/2012/12/06/the-real-fiscal-risks-in-the-united-states/?partner=rss&emc=rss

Obama Says Vote Validates His Efforts on Taxes

In his first remarks from the White House since his re-election, Mr. Obama made it clear that he believed his victory had validated his relentless campaign call for wealthier Americans to pay more and that he expected Republicans to heed that message.

“I just want to point out this was a central question during the election,” he said in brief remarks in the East Room. “It was debated over and over again. And on Tuesday night, we found out that the majority of Americans agree with my approach.”

Mr. Obama said he had invited Congressional leaders to the White House next week to begin talks as they return for a lame-duck session of Congress. He said he was willing to make some concessions as long as the final fiscal bargain was properly balanced between new tax revenue and spending cuts.

“I’m not wedded to every detail of my plan,” Mr. Obama said. “I’m open to compromise.”

At the same time, he encouraged Congress to quickly pass an extension of the existing lower rates for those making under $250,000 even while the broader negotiations take place.

“While there may be disagreement in Congress over whether or not to raise taxes on folks making over $250,000 a year, nobody — not Republicans, not Democrats — want taxes to go up for folks making under $250,000 a year,” he said. “So let’s not wait.”

The president’s comments came shortly after Speaker John A. Boehner, who had been striking a conciliatory tone since Republican election losses in the Senate and the House, told reporters that Republicans had won a mandate of their own by retaining control of the House and that he supported continuing rates enacted in the Bush-era tax cuts for all income levels.

“Raising tax rates will slow down our ability to create the jobs that everyone says they want,” said Mr. Boehner, who said he favored generating any new federal revenue to offset the deficit by closing tax loopholes and limiting deductions.

“It’s clear that there are a lot of special interest loopholes in the tax code, both corporate and personal,” he said. “It’s also clear that there are all kinds of deductions, some of which make sense; others don’t. And by lowering rates and cleaning up the tax code, we know we’re going to get more economic growth.”

The president and Mr. Boehner were careful with their language and left room for compromise despite their fundamental differences about shifting more of the tax burden to high-income Americans. Mr. Boehner would not be very specific on what his goal might be for raising new federal tax dollars.

“I don’t want to box myself in,” he said. “I don’t want to box anybody else in. I think it’s important for us to come to an agreement with the president. But this is his opportunity to lead.”

The speaker, who has struggled with his more conservative rank and file in the past, said he was confident that he could pass a deal if one was reached with the White House. “When the president and I have been able to come to an agreement, there has been no problem getting it passed here in the House,” he said.

House Republican leadership aides found some positive signals in Mr. Obama’s combative tone. They noted that he never specified he wants tax rates to rise, only that he wants additional revenues generated by taxes on the rich. That would give both sides the latitude to devise a restructured tax code that eliminates or limits tax deductions and credits for the rich — or that follows Mitt Romney’s proposal to cap deductions at a set limit for rich households, though many analysts say that approach alone cannot raise the revenue Democrats want.

Any agreement to avert a fiscal crisis in January, when hundreds of billions of dollars in automatic tax increases and spending cuts kick in, now revolves around the definition of tax increases. Mr. Boehner is holding the line against any increase in tax rates, even for the richest Americans, who currently are in the 35 percent tax bracket. But he is leaving open the possibility of a tax overhaul that raises more revenue than the existing code.

Article source: http://www.nytimes.com/2012/11/10/us/politics/obama-and-boehner-circle-each-other-on-budget-impasse.html?partner=rss&emc=rss

Bucks Blog: Friday Reading: Students Say No to Healthier School Fare

December 23

Friday Reading: Students Say No to Healthier School Fare

Students say no to healthier school fare, House Republicans back temporary payroll tax extension, retailers slash prices ahead of the holiday and other consumer-focused news from The New York Times.

Article source: http://feeds.nytimes.com/click.phdo?i=cf13c59ab5497b65d8aaa87a87f8fa03

Economix Blog: Deficit Deals Weren’t Always So Antitax

I had an article over the weekend about how previous deficit-reduction deals were much more tax-heavy than anything on the table today — until, that is, 1997. Here’s a breakdown of the deficit reductions that came from higher tax revenue versus spending cuts in the deals passed in the last 30 years:

DESCRIPTIONSources: Congressional Budget Office, Center on Budget and Policy Priorities, Simpson-Bowles Commission, Senator Toomey’s office.

As you can see, the five major deals of the 1980s and early 1990s relied much more heavily on tax increases to do the dirty work of deficit reduction. On average, tax increases accounted for 61 percent of deficit reductions (and much more during the early Reagan years, despite President Ronald Reagan’s reputation as the taxpayer’s friend).

But by 1997, tax increases were wholly ruled out as a source of deficit reduction. In fact, Congress — finally with a Republican majority by that point — decided to cut taxes, which meant spending cuts had to be even greater to make up for the loss in tax revenue. That’s why the chart above shows that tax changes subtracted from total deficit reductions by 71 percent.

The compromise proposal offered by one of the Republicans on the deficit “supercommittee” was significantly less reliant on tax increases than the ’82-’93 deals, offering 24 cents in tax increases for every dollar the deficit was reduced. But still, there was some sense that deficit reductions should come from both sides of the ledger.

Now, with the supercommittee reportedly disintegrating, the deficit reductions are going to look a lot like the 1997 deal: Without a supercommittee proposal, automatic spending cuts of $1.2 trillion over the next decade will kick in, and no tax increases. Congress also looks ready to extend the Bush tax cuts, which are currently scheduled to expire at the end of 2012.

That means that once again, tax changes would detract from, rather than contribute to, deficit reduction.

Article source: http://feeds.nytimes.com/click.phdo?i=07874075cb5bd559ea3358fded3ddee3

Letters: Letters: Of Errors and Calories

Opinion »

The Thread: Battle of the Borders

Republicans talk tough on immigration, and a record number of illegal immigrants were deported under President Obama.

Article source: http://feeds.nytimes.com/click.phdo?i=6a80739f22fa32ca42c97df8e956061d