Project America - Issue of the Day Archive for the ‘Budget’ Category
Issue of the Day Archive for the ‘Budget’ Category

Health Care to be Addressed by President Obama
Published Monday, May 11th, 2009 by Lacey Loftin

In an effort to influence the Health Reform that President Obama is determined to initiate, hospitals, insurance companies, drug makers and doctors will voluntarily slow their rate increases in coming years, potentially adding up to $2 trillion in spending reductions over 10 years. 6 major health groups pledged to cut the rise in health care costs by 1.5 percentage points each year. This move will help provide health insurance to the growing 50 million who now have no health insurance. Obama’s plan is estimated to cost the federal government $1.2 to $1.5 trillion over 10 years, only half of that has been accounted for by the White House. Health groups who discouraged the health reforms prescribed by the Clinton administration seem to be coming forward to help President Obama for a variety of reasons.

By 2007, overall annual consumer expenditures for Private and public health care has reached 1.2 trillion and 1.02 trillion respectively. The difference in public and private expenditures has not always been so wide; between 1977 and the present, the range has slowly grown wider, except between 1994 to 2000 where private shrank and public grew. The number of uninsured has grown from 14% in 2000 to 15.3% of the population in 2007. The percentage includes the State Children’s Health Insurance Program (SCHIP), which has grown from 3.4 million in 2000 to 6 million in 2005. Most prone to be uninsured are minorities, who are disproportionately uninsured at 24.5-21.8% and those who of 18-44 years of age. All of which has lead to a steady increase in government health care rolls from 10.3% in 2000 to 13.2% in 2007.

Number of Swine Flu Cases in US
Published Friday, May 1st, 2009 by Lacey Loftin

As of Thursday night, Swine Flu has infected 91 people and one death has been attributed to the virus. According to the CDC, Swine Flu has reared its snout frequently in the past 30 years with varying intensity. From 2005 to January 2009, a total of 12 human cases of swine flu were detected in the U.S. with no deaths. In 1976, an outbreak of Swine Flu in Fort Dix, New Jersey caused more than 200 cases with serious illness in several people and one death. A singular event in 1988 occurred when a pregnant woman in Wisconsin died from pneumonia after being infected with Swine Flu. In response to the current outbreak, the CDC has implemented its emergency response. However, the outbreak has become political as the parties argue over $780 million removed from the stimulus bill for pandemic preparedness.

The CDC’s efforts and that of the nation’s health care system have made a concerted effort to cut the number of cases of influenza in the US. Influenza and Pneumonia, during the last decade, represented the 8th greatest cause of death in the US — 72,507 deaths out of 2,425,901 in 2006. Over the course of the last decade, the rate of deaths from all types of the influenza and pneumonia has steadily reduced from 23.4 deaths per every 100,000 people in 1999 to 18.8 in 2006.

Funding Reduced for Safe and Drug-Free School Program
Published Monday, April 20th, 2009 by Lacey Loftin

At the 10 year anniversary of Columbine, the lessons learned that day have influenced the creation of near fortress-like schools. Schools have installed metal detectors and security cameras, banned backpacks, required IDs for all personnel and students, and posted police in hallways. Now, the Department of Education wants to explore the idea of creating stronger school communities that can protect themselves with or without the high-tech gear. The trend towards less costly measures has come since security funding for the Department of Education’s Safe and Drug-Free Schools program were cut by a third between 1999-2008, and the 6,300 police officers in public schools has been cut altogether in 2005. On the other hand, money for school counseling has increased since 10 years ago from $20 million in 2000 to $52 million.

While the funding for security in schools has been cut, the use of cameras and metal detectors has remained in many troubled schools that face difficulties such as guns in schools. In 2002, among the various school populations — Public, Private, Urban, Suburban and Rural — Urban schools have, by far, instituted the most security precautions of the group. Some of the most used measures are student lockers, exterior lights, materials covering classroom windows, security guards, cameras and fencing around the entire school, and parking lots monitored/locked during the day. Some of the less used methods are bars on the windows and metal detectors. 

Farm Subsidies Reform Contained in 2010 Budget
Published Friday, April 17th, 2009 by Lacey Loftin

The 2010 Federal Budget has caused some concern over its $3.6 trillion price tag and some of its reforms. The new budget has called for some farm reforms that have spurred debate on both sides of the Hill. One of the main contentions is that the budget “supports the implementation of a $250,000 commodity program payment limit. The payment limit will help ensure that payments are made to those who most need them.” This program targets farm programs to family farmers and provides the stability and predictability against market disruptions and weather disasters. Moreover, the President wants to transition large farms from direct payments to increased income from revenue derived from emerging environmental services. The President will phase out direct payments over 3 years to farmers with sales revenue over $500,000.

Currently, direct payments of farm subsidies are made to even large producers regardless of crop prices, losses, or whether the land is still under production. The total cost of farm subsidies in current dollars over the last 40 years is somewhere in the neighborhood of $140 billion. This current reform has stemmed from the fact that 10% of all who received farm subsidies received 72 % of all payments made between 1996-present.  Accordingly, only 13 states are awarded Farm Subsidies between $5 and $14.9 billion out of the $140 billion total.

Funds Now Available to Help Education Woes
Published Thursday, April 16th, 2009 by Lacey Loftin

On April 1st the Secretary of Education Arne Duncan announced that $44 billion for states and schools is available under the Recovery and Reinvestment Act. The investment will herald in new reforms and save hundreds of thousands of jobs who before the Act were subject to state and local budget cuts. The package includes $26.6 billion to save jobs and improve K-12 and higher education, as well as a separate $6 billion in a Government Services Fund to pay for education, public safety and other government services. Funds left over will be distributed later this year as applications are approved. Guidelines for the monies includes improvements in the effectiveness of teaching, progress towards college and career ready standards, improving achievement standards, plus data gathering through enhanced data systems that track progress.

US education spending has reached $93.4 billion, as of 2006, nearly three times 2000 levels. Yet, after that climb the amount dropped to $63.5 billion or 2.3% of the entire 2009 budget. With many districts spending above their allotted revenue, their debt has crept up to more than half their yearly revenue. Comparing education expenses as a percentage of country gross domestic product, the US is in the bottom third of top grossing countries.

Tax Reform on the Horizon
Published Monday, April 6th, 2009 by Lacey Loftin

In two separate events, the Obama administration has started investigating tax reform. The last major tax reform took place in 1986.  President Bush appointed a tax reform commission in 2005, which delivered a report in that same year, but its recommendations were not included in the 2007 budget. Prof. Elizabeth Garret of USC, who sat on the commission, has been announced to become assistant secretary of the treasury for tax policy. Also, President Obama asked Paul Volcker, who chairs his Economic recovery Advisory Board, to appoint a tax reform task force that would report no later than December 4th.

Given the composition of tax receipts over time, the percentage of each category has changed given the reforms made by various administrations. For the 2008 fiscal year, individual tax income amounted to $1,146 billion; $23 billion lower than expected. Corporate taxes amounted to $304 billion, $5 billion lower due to $4 billion lower in payments and $1 billion in extra refunds. Social Insurance and Retirement Receipts were $900 billion, $1 billion lower than estimated. Other taxes, such as customs duties, estate and gift taxes came to $106 billion, which was $1 billion more due to higher estate taxes, gifts, fines and penalties. The overall budget in 2008 amounted to $2,979 billion, which was $36 billion above the estimate due to the Department of Defense and the Treasury.

North Dakota and Others Brace for Flooding
Published Friday, March 27th, 2009 by Lacey Loftin

Parts of North Dakota sat underwater Thursday as rising waters from melting snow swelled the banks of the Red River.  Experts predict a historic 41-foot crest by Saturday.  The existing dikes, designed for a maximum 39ft crest, may be unable to contain the river’s swell. According to the National Oceanic and Atmospheric Administration, the last flood near the predicted crest was in 1997 at 39.6ft and in 1897 at 40.1ft in Fargo, the Red River’s most populated city. The Red River filters into the Missouri River, and nearly 4,000 people were evacuated Tuesday from an area near Bismarck.

In the new 2010 fiscal year budget, up for vote in Congress, President Obama supports the safe and reliable operation and maintenance of key existing water resources infrastructure. The budget funding amounts to $5.1 billion and the American Recovery and Reinvestment Act provides $4.6 billion for infrastructure and Army Corps of Engineers discretionary funding. From the Red River, the water empties into the Missouri river, then flowing into the Mississippi river down to New Orleans where, after Katrina, the $15 billion upgrade, scheduled for completion in 2011, is only 20% complete.

Tax Revenue Rises in 2008 But Well Below Spending
Published Thursday, March 19th, 2009 by Lacey Loftin

The Release of the 2008 Internal Revenue Service Data Book details many aspects of the fiscal intake of the Federal Government, including information about returns filed, tax collections, enforcement, taxpayer assistance, the IRS budget and workforce. During the fiscal year (Oct. 1, 2007-Sept. 30, 2008) of 2008, the IRS collected more than $2.3 trillion in taxes and processed over 250 million returns. $270.4 billion was distributed through the stimulus payments. Overall, the IRS spent an average of $0.41 to collect each $100 of tax revenue; that is $94.3 million. This number is actually down since the advent of the electronic filing system, of those filed, 101 million or 58% of individual tax returns were filed electronically.

The amount of tax revenue in current dollars has just recovered its stride from the deep tax cuts—its recent low point of 1.66 trillion in 2003—that the Bush Administration imposed. The percentage of tax returns examined by the IRS has actually increased and stayed steady since 2006 at an examination rate of 1% per year. However, with the new spending by both Presidents Bush and Obama, the increased tax revenue will not meet spending for the eighth year in a row.

Bank Proposal Calls for $1 Trillion
Published Monday, March 16th, 2009 by Lacey Loftin

The Treasury Secretary is soon to announce the details to a plan calling for a public-private partnership: government financing buying up to $1 trillion in toxic bank assets and a comprehensive review of banks to determine how much of the remaining financial sector bailout funds will be needed for troubled banks.  Geithner stated on Friday that the plan calls for the remainder of the $700 billion financial bailout fund, yet other bank stability plans may require a request of another $750 billion new funds found as a placeholder in President Obama’s budget.

By restructuring the bad assets held by the banks, the government hopes to increase the banks’ lending potential, thereby allowing businesses to increase investment and hire workers, which could increase consumer demand and overall economic health.  The real gross domestic product contracted 6.2% in the last quarter of 2008, after a third quarter decrease by 0.5%, offset by the increase in government spending and a decrease in imports.

Stimulus Act Raises Budget Deficit to WWII Levels
Published Sunday, March 1st, 2009 by Lacey Loftin

With this new $787 billion dollar Stimulus Act came nearly $350 million for oversight—0.04% of the total act—involving $253 million for Inspectors general, $84 million for a transparency board, and $25 million for the Government Accountancy Office. The previous $700 billion bank bailout had $50 million or 0.007% of oversight. David M. Walker, former head of the Government Accountability Office stated that “If you don’t have appropriate conditions set up front, you are going to end up having a lot of disappointments.” President Obama, planning ahead, wants to begin looking to some hefty financial cut backs and careful spending of taxpayers dollars to return the budget deficit back to 3% of GDP by 2014.

The newly proposed 2010 Budget has reported that the 2009 federal budget deficit with the new Stimulus Act will be approximately 12.3% of the Gross Domestic Product, up from 3.2% last year. For a bit of perpective, during the years of World War II, 1942-1945, the budget deficit hit 14.2%, 30.3%, 22.7% and 21.5% of GDP, respectively.  Adding the 2008 bank bailout, $748 billion, places the current total debt at $10,843 billion, although a portion of these funds may be recovered or overall yield a profit from the owned shares in these banks.

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