Budget

The head of AFL-CIO on Wednesday assailed the proposed cuts to entitlement programs in President Obama’s budget plan as “wrong and indefensible.”

AFL-CIO President Richard Trumka said the White House plan wasn’t what people voted for in November when they reelected the president.

“A president’s budget is more than just numbers. It is a profoundly moral document.  We believe cutting Social Security benefits and shifting costs to Medicare beneficiaries — while exempting corporate America from shared sacrifice — is wrong and indefensible,” Trumka said.
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House Budget Committee Chairman Paul Ryan (R-Wis.) and Senate Budget Committee Ranking member Jeff Sessions (R-Ala.) said Wednesday that the White House is exaggerating the deficit reduction in President Obama’s new 2014 budget.

Ryan said the lack of ambition in the budget means Washington should focus on piecemeal reforms this year because there is no hope of a deficit grand bargain. 

Republicans say that when “gimmicks” are accounted for, the budget only reduces deficits by $119 billion over 10 years. The White House says the deficit reduction figure is $1.8 trillion. 

“I am very disappointed … the actual deficit reduction is a paltry $119 billion over 10 years,” Ryan told reporters. “It does not begin until 2020, four years after the president has left office.”

President Obama's budget proposes overhauling the nation's $1.5 billion-a-year food aid program, setting up a bruising battle on Capitol Hill that cuts across party lines.

In one corner are farm state lawmakers who want the government to continue buying U.S.-grown food and shipping it abroad. In the other: reform proponents who agree with Obama that the current system is a waste of taxpayer money that only harms poor countries' ability to grow their own food.

“After nearly 60 years of experience, we are encouraged by the president’s proposal to fundamentally alter our food aid program to reach more people, more quickly, at less cost,” Reps. Ed Royce (R-Calif.) and Eliot Engel (D-N.Y.), the chairman and ranking member of the House Foreign Affairs Committee, said in a joint statement. “Several recent studies have highlighted the need for reform. We look forward to working with the Administration and our colleagues in Congress to modernize U.S. food aid programs while ensuring maximum impact and efficiency.”

They'll have a tough time convincing their colleagues on agricultural panels. Twenty-one senators wrote to Obama opposing the overhaul when rumors first emerged. 

“American agriculture is one of the few U.S. business sectors to produce a trade surplus, exporting $108 billion in farm goods in 2010,” they wrote. “During this time of economic distress, we should maintain support for the areas of our economy that are growing.”

The U.S. government will actually turn a profit on its bailout of housing giants Fannie Mae and Freddie Mac, according to President Obama's 2014 budget proposal.

Assuming that Congress and the White House do not act to eliminate the government-sponsored enterprises (GSEs) over the next decade, Obama's budget released Wednesday projects the government will ultimately turn a $51 billion profit on its 2008 rescue of the then-ailing housing giants.

The federal government has pumped $187.5 billion into Fannie and Freddie since their rescue in the wake of the subprime mortgage crisis. The two entities were weighed down by significant losses on their guaranteed mortgages when the housing bubble burst.

But with the housing market turning around and the GSEs looking to shore up their books, Fannie and Freddie are beginning to turn a profit again, which is now going straight to the Treasury Department.

Sylvia Burwell will likely get Senate approval to head the Office of Management and Budget.

The budget would add $5.3 trillion in new deficit spending over 10 years and increase spending in 2014 by $160B.

Obama said the main goal of his budget is to help the middle class — "the true engine of the economy."

The proposals, designed to curb long-term defense costs, are politically unpopular and will have a tough time getting congressional approval.

The Obama budget looks to spark fiscal negotiations.

Most payouts in mortgage case to be under $1,000.

Conservative group mobilizes against spending cuts.

U.S., Germany pooh-pooh growth, austerity split. 

Financial company hires dozens of former regulators. 

The reaction from several Senate targets of Obama’s “charm offensive” contrasted with Boehner's chilly reception.