Washington, U.S.A. — The Concord Coalition has said that new projections by the Congressional Budget Office (CBO) underscore the need for Washington to commit to long-term fiscal reforms while dealing with this year’s looming budget decisions. Concord said the new numbers should also provide a sobering picture for this year’s candidates for federal office one that should temper election-year impulses to offer voters unrealistic promises.

“Once again, CBO’s projections show that if politicians don’t deviate from current policies, the country will continue down an unsustainable path that threatens to weaken the country, jeopardize our standard of living and leave our children and future generations with unmanageable levels of government debt,” said Robert L. Bixby, Concord’s executive director. “These numbers should frame this year’s political debates, and candidates from both parties would do well to spend some time studying their implications.”

“We need to put the country on a better fiscal path,” he added, “and candidates must clearly explain to voters — with specifics, not empty rhetoric — how they plan to do that. It will require setting priorities and making changes throughout the federal budget, and voters deserve to hear credible plans for doing this.”

CBO’s Update to the Budget and Economic Outlook estimates that the federal deficit for this fiscal year, which ends Sept. 30, will total $1.1 trillion. While that is down slightly from CBO’s March projection, it will be the fourth consecutive deficit of more than $1 trillion. In addition, federal debt held by the public would reach 73 percent of GDP, which CBO notes is the highest level since 1950 and is “about twice the share that it measured at the end of 2007, before the financial crisis and recession.”

The CBO prepared two sets of projections. The first — the CBO’s “baseline projections” — assumes that current laws will generally remain in effect. An alternative scenario, however, looks at what could happen if Congress changes certain laws to continue many current policies. This alternative scenario presents a far more troubling long-term picture. Using the new CBO numbers, The Concord Coalition today updated its own “Plausible Baseline,” which applies what Concord considers to be realistic assumptions about future policy decisions. These projections are close to the CBO’s alternative scenario.

The budget office notes that the outlook for budget deficits, federal debt and the economy are “especially uncertain now because substantial changes to tax and spending policies are scheduled to take effect in January 2013.” These changes have often been called the “fiscal cliff” because if Congress allows all of them to take effect at once, it could cause substantial short-term economic damage, perhaps triggering a recession.

Under Concord’s Plausible Baseline, deficits between 2013 and 2022 would be much higher, averaging over 5 percent of GDP rather than 1 percent. Debt held by the public would grow to 93 percent of GDP by 2022, the highest level since shortly after World War II. As the budget office points out, that is not a sustainable level of federal debt.

“The differences between the CBO baseline and either CBO’s alternative scenario or Concord’s Plausible Baseline are striking, and they highlight the importance of the policy decisions that elected officials must confront before the end of the year,” Bixby said.

“While it is important to support the economic recovery, Washington should also be laying the groundwork for the big fiscal reforms that are necessary to put the federal budget on a more responsible track over the long term. It is possible to do both, but this will require more thoughtful policy-making and greater bipartisanship than we have seen in Washington recently.”

• Choices over tax policy, account for the bulk of the difference between the CBO baseline and the more plausible scenarios within the 10-year budget window. Extending the 2001 and 2003 tax cuts, along with fixes to the Alternative Minimum Tax (AMT) and debt service costs would add $5.2 trillion to deficits over 10 years.
• In CBO’s baseline projections, mandatory spending will increase from 13.3 percent of GDP in 2013 to 14.4 percent in 2022. Nearly all of that increase would be due to the growth of just Social Security and Medicare — representing the effect of the baby boom generation entering retirement. CBO projects that by 2022 over half of the entire federal budget will be spent on just Medicare, Medicaid, and Social Security.
• For Medicare specifically, baseline growth is not attributable to health care inflation but instead to demographics.
• The mandatory spending category of income security, now higher than normal because of the recession, would drop by over 60 percent over the budget window (from 2.1 percent of GDP to 1.3 percent).
• Interest payments under the Concord Plausible Baseline would more than double, growing from 1.4 percent of GDP this year to 3.6 percent in 2022, and would cost over $5 trillion during the 10-year period.
• If the caps included in the Budget Control Act are adhered to, CBO projects that discretionary spending would decrease from 8.3 percent of GDP in 2012 to 5.6 percent by 2022 — the lowest level in the last 50 years.

For more about our plausible baseline visit:

http://www.concordcoalition.org/concord-coalition-plausible-baseline

Image Courtesy of  Third Way

The article CBO Projections Show Candidates Face Difficult Decisions appeared first on The Toonari Post - News, Powered by the People!.

Things are starting to look dim for Republican candidates Newt Gingrich, Ron Paul and Rick Santorum as Super Tuesday’s results revealed that Mitt Romney is definitively the front runner for the GOP spot for the election this coming November. But the real question is whether he will be able to beat out President Barack Obama for the presidential term of 2012 to 2016.

Romney was victorious in six of the ten states on Tuesday including Massachusetts, Ohio, Virginia, Alaska, Idaho and Vermont. Santorum followed with three wins in the states of North Dakota, Oklahoma and Tennessee. Gingrich trailed with only one win in Georgia and Ron Paul still has not won a single state’s primary or caucus.

Romney, the former governor of Massachusetts, easily won the state’s vote with a turnout of approximately 72% voters in his favor. Surprisingly though, only about 20% of all registered Republican and Independent voters showed up to the polls to cast their ballots on Tuesday, according to Brian McNiff, who is the spokesman for Secretary of State William Galvin. This is a significant drop from all presidential primaries in 2008 where about 45% of registered voters cast their ballots for both the Democratic and Republican parties.

Massachusetts State Representative George Peterson is positive that there will be a much higher turn out for the general election in November. Peterson stated, “People feel very strongly about this race and they are not happy where this country is headed.” Peterson also added that he sees, “a 60% percent turnout in the presidential race, and having Romney and Senator Brown on the ballot will be extremely helpful to all Republicans in the Legislature.”

In order for any presidential candidate to make it to November, one thing is important above all: Monday. And Romney has that. Massachusetts Party Chairman John Walsh claims that over the past seven years, Romney and his supporters have spent over $200 million in order for Romney to receive the Republican Party’s nomination. While Romney might have the money to get there, it’s going to be hard for the people of the state of Massachusetts to forget that the state ranked third lowest in the country as job creation and manufacturing declined over twice the national average during the time that Romney served as Governor there.

Despite Romney’s wins, none of the other Republican candidates have dropped out of the race — yet. The next state Romney must tackle is Kansas on Sunday and then Mississippi and Alabama on Tuesday. However, strategists believe that Santorum has a good chance of winning those states because he has strong supporters there. Santorum could be the only thing standing in the way of Romney being the Republican candidate for the presidency. Based on polls, Santorum is favored by those making less than $100,000 a year, non-graduates, independents, and people under the age of 65.

In the long run, Romney is looking to be the Republican nominee up against current President Obama in November, but before then, it looks as if he is going to have to beat out his Republican rivals. For Romney, it could be a long and drawn-out race until April, when the states of Maryland, Delaware, and Connecticut get to vote, as well as the District of Columbia. At that time, things will be much clearer as to who will go up against Obama in November.

Image Courtesy of    http://www.flickr.com/photos/newshour/

The article Will Romney’s Super Tuesday be Enough to Win Him the GOP? appeared first on The Toonari Post - News, Powered by the People!.

Late last week, German president Christian Wulff resigned in embarrassment and disgrace after his scandalous behavior came to light. The controversy caused the public to lose trust and faith in their president and turn on him.  Wulff, 52, had previously enjoyed high ratings. “The last few weeks have shown… my ability to be effective has suffered sustained damage,” said Wulff.

Although the German president is largely a ceremonial role, it is supposed to provide the people with a moral compass, and this scandal has greatly hurt the office. The news is a major blow to German Chancellor Angela Merkel, who handpicked Wulff for the position in June 2010.

Allegations surfaced in December, when newspapers began to look into an improper home loan he received from a family friend before he became president. Wulff became increasingly irate over these investigations and left a voicemail for one of the editors of Germany’s best-selling tabloids, ‘Bild’, saying it would mean “war” if the paper published a story on his financial past. ‘Bild’ decided in favor of publishing the story, and Wulff apologized for his unruly behavior.

The media continued to scrutinize his past dealings in the wake of this incident, with news of him accepting free upgrades on planes and staying at various hotels and inns without charge during travels with his family. Last week, prosecutors asked Parliament to put a stop to Wulff’s legal immunity over claims that he had received favors. Trying to investigate a German president is without precedent, and the move had opponents calling for his departure from office.

Merkel had remained loyal and sympathetic to Wulff during the past months’ controversies. Both belong to the same political party, the conservative Christian Democratic Union. She said she regretted his decision, canceling a visit to Rome to quell the outrage in her homeland. Merkel’s popularity among the people has not been affected by the scandal, but the controversy has served as a diversion on which she and her party can focus.

Wulff is the second president to resign in two years. Horst Koehler, Wulff’s precursor, left office without warning in 2010 after receiving heat for remarks he had made about German military in Afghanistan. Merkel stated she would talk to her opposition over who would be the next candidate, unlike last time. Until a consensus is reached, Horst Seehofer, the governor of the state of Bavaria and leader of the upper house of Parliament, will fill the role of acting president.

Image Courtesy of    http://www.flickr.com/photos/d_b_u/

The article German President Resigns Amid Scandal appeared first on The Toonari Post - News, Powered by the People!.