Economy & Budget

Where is your deficit reduction plan Mr. President?

President Obama, my wife and I are overjoyed to have another healthy, baby boy join our family last month. As you and Mrs. Obama probably recall with the birth of your daughters, this special time brings a lot of changes (and I don’t mean just diapers), and it also typically has instilled parents with a lot of hope, as loving parents desire and expect that their offspring will have a better life than theirs. We are blessed to live in a country whose founding principles of life, liberty, and opportunity impart us with such hope for our next generations. However, despite my son being blessed with being born in the USA, I am concerned for him and the future of this great country.
I am fearful for my son’s generation and the over $5,000,000,000,000 (Trillion) in debt inherited during your term. If the national debt were to be divided by the American citizen population, his share of indebtedness now stands over $50,000.


JP Morgan provides opportunity to reflect on Orderly Liquidation Facility

The news of unexpected losses at JP Morgan should provide renewed support for a Dodd-Frank provision that strikes at the heart of the problem of “too big to fail”. When my Financial Services Committee colleagues and I were debating Wall Street Reform, one of our top priorities was to provide a workable system for allowing interconnected financial firms to fail—without dragging the rest of the economy into a downward spiral.

Title II of Dodd-Frank accomplishes that by creating an orderly liquidation facility (OLF) to unwind large, interconnected financial institutions. The OLF provides regulators the necessary tools to allow a financial institution to fail without threatening to freeze markets or necessitate another bailout.


Jobs and the economy

Having just observed Memorial Day, we are reminded of the blessings of liberty and living in the land of the free. That is why helping to create jobs and grow our economy will continue to be my focus in the weeks and months ahead. In every facet of our society – the care of our veterans, budget, health care, and energy – we are in need of policies that get folks back to work and create an atmosphere that rewards hard work and keeps government out of the way of innovation.
Implementation of the bipartisan Veterans Opportunity to Work (VOW) Act is essential to lowering veteran unemployment. Through this legislation, discharged service members seeking a job will obtain the help they need to get a job – and not just any job, but one in which they have the training. Furthermore, if they need additional training, the VOW Act provides education and training for our veterans. Not only will veteran unemployment be lowered by legislation such as the VOW Act, but it will also aid in lowering homelessness in veteran communities.


Misinformation fueling attacks on Disability program

“Cutting waste, fraud and abuse” is Washington D.C.’s most tired cliché. But it is also becoming perhaps its most dangerous.
Elected officials across the political spectrum widely accept that the federal government needs to eliminate some of its bloated and redundant programs. Entitlement reform will be crucial to any plan to balance the federal budget and pay down our national debt.
But if you listen closely, the term “waste, fraud, and abuse” is code for something much more disturbing. The phrase provides budget hawks cover to conduct budgetary witch hunts and gut vital government programs that so many Americans depend on to survive. One such program, Social Security Disability Insurance (SSDI), may be next in their sights.


The great risk transfer... To Baby Boomers

It’s not a good time to be a Baby Boomer. The generation is on the cusp of becoming the largest population of retirees in U.S. history and there has never been a worse time to plan for retirement.   
The goal for any retiring Boomer is straightforward: design a portfolio that generates enough income to sustain a certain lifestyle, post-retirement. This has traditionally meant finding securities that offer capital preservation and income—basically, bonds. In the current environment, however, the conventional balance between risk and return has been disrupted.
With yields at historical lows that are barely keeping pace with inflation, the risk-return tradeoff could not put retirees in a worse position.  If an investor buys a 10-year U.S. Treasury note, today, the payoff would be 1.72% before tax. Accounting for inflation (expected at 2.3%), the investor actually loses purchasing power the longer the bond is held.


SAFE Act needed now more than ever

I’ve skimmed some informed discussions at economics blogs about how JPMorgan Chase (JPMC) lost $2 billion and counting on their “synthetic credit portfolio.” But educated guesses are still guesses, the next big problem in the financial system will be entirely different, and to be honest, it all gives me a headache.

My imperfect understanding puts me in good company.

“Paul Volcker by his own admission has said he doesn’t understand capital markets,” Jamie Dimon told Fox Business News earlier this year. “He has proven that to me.” Dimon reportedly was asked at a dinner for investors about Volcker’s criticisms and the arguments by Richard W. Fisher, president of the Federal Reserve Bank of Dallas, that “too big to fail” banks should be broken up. Dimon said he had only two words for Volcker and Fisher: “infantile” and “non-factual.”


Washington's fad diet: A reality check from state legislators

As a state legislator, it has never been more frustrating to watch Washington, DC than it is right now. At a time when record numbers of Americans are struggling with hunger and we desperately need economic stimulus, Washington seems to be pursuing the political equivalent of a crash starvation diet. Nowhere is this more evident than in the treatment food stamps are receiving in Congress.

Common sense tells us this is not the time to cut the Supplemental Nutritional Assistance Program (SNAP), known to most Americans as food stamps. The proposed cuts are job-killers, and working families have rarely needed this program more than right now.


We need a bipartisan budget

This week, the non-partisan Congressional Budget Office (CBO) stated “if the fiscal policies currently in place are continued in the coming years, the revenues collected by the federal government will fall far short of federal spending, putting the budget on an unsustainable path.” This is unacceptable.  With trillion dollar deficits and a skyrocketing debt, now is the time to put people before politics and progress before partisanship. That is why I was proud to co-sponsor the only bipartisan budget that has been voted on in the House of Representatives in decades.


Four words: No budget, No pay

The date:  April 29, 2009. The time:  05:31 p.m. On that day, at that hour, the United States Congress did something it has failed to do ever since – pass a budget.
While countless families and businesses across America have had to make the tough choices to spend within their means, Congress has operated over a thousand days without passing a fiscal blueprint to restore financial sanity to Washington. This blatant neglect of a fundamental duty has led to runaway spending, trillion-dollar deficits, and has contributed to the worst jobs climate since the Great Depression.
Make no mistake, passing a budget is not a choice. The 1974 Congressional Budget Act obligates both chambers to adopt a budget resolution every year by April 15. The House has done its part, passing resolutions the past two years that cut trillions in wasteful spending. Unfortunately, Senate Leader Harry Reid and others in his chamber continue to sit on the sidelines – 1,120 days and counting.


The National Guard: Grounded in America's past, Essential to its future

Challenging budgets and global conflict have become prevalent themes in our national dialogue. Americans expect their government to fulfill its fundamental responsibility of ensuring the nation's security while rightfully demanding a high return on their hard-earned tax dollars. This expectation is critical to the debate over the future of our Armed Forces, and is the reason the National Guard stands at the forefront of that debate as an indispensible, efficient, combat-tested solution both globally and locally.