The Department of Labor released its weekly unemployment insurance claims data this morning. Initial and continuing claims moved slightly downward, from 445,000 to 432,000 and from 3,379,000 to 3,362,000, respectively. The four-week moving average of initial claims, however, ticked up from 438,500 to 445,750.

Over on Capital Gains and Games (a favorite blog of the Budget Brigade), budget guru Stan Collender and Pete Davis muse, in a couple of posts, on the presidential candidates' budget plans. They emphasize the point that, as much as they may want to implement deficit-increasing tax and/or expenditure plans, the market may have other plans.

First, Collender reminds us that in the post-Reagan world, economic policy options were limited.

The bond market "vigilantes" -- the same people who forced the Clinton administration to propose and push for deficit reduction -- are starting to say that the moon, stars, and planets may line up again in 2009 to force the next president to do the same thing.

In a follow-up post, Davis explains how large, persistent deficits impact the economy. This may give the next president pause (Davis hopes) and put the kibosh on his plans.

High real interest rates choked off recovery from the 1980 recession until early 1983, and real growth turned down again in 1986, but stopped short of a recession. The first chart [shown] also shows the "neutral real rate" required to keep the economy at full production. With the credit crisis, it has moved negative, where it remains today. It will take us at least another year or two to come out of our economic "slowdown," and rising interest rates could easily choke that recovery off.

Taxpayer for Common Sense, the scrappy nonprofit that is fast becoming the go-to resource for all things earmarks, released a new analysis earlier this week showing that earmark levels have dropped slightly in the FY 2009 appropriations bills compared to last year. From the TCS report:

During this election year, lawmakers are showing slight restraint in writing the earmarks in the FY 2009 spending bills, according to an analysis by Taxpayers for Common Sense (TCS) (click here for the new database). The House has increased the number and value of earmarks at about the same rate. The Senate has cut earmarks by 16% in the spending bills in terms of total dollars. The analysis is based on all the bills that have passed full committee and are awaiting action in both chambers.

The appropriations bills are not complete yet (far from it) and TCS warns that lots could change. In fact, they state the FY 2009 spending bills may end up with more earmarks because of how the bills are likely to be enacted:

The slight progress made on reducing the total costs of earmarks will be eliminated the longer we wait to pass the 2009 spending bills. The most likely scenario is a major omnibus spending bill during the first days of the 111th Congress. So any earmark reductions we are seeing in August are likely to be negated by an avalanche of earmarks that always accompanies major omnibus spending bills.

At least legislators running for re-election can say with a straight face they are trying to reduce earmarks. I suppose that's better than them claiming that cutting earmarks saves any money. It doesn't

On Tuesday, August 19, the Coalition on Human Needs is once again hosting a webinar to help advocates and analysts prepare for the release of annual data from the Census Bureau about poverty, income, and health insurance in the U.S. The webinar will take place from 2:00 - 3:30 (EST) on the web, and feature Jared Bernstein of the Economic Policy Insitute, Douglas Hall, Acting Managing Director of Connecticut Voices for Children, Deborah Weinstein, Executive Director of the Coalition on Human Needs, and will be moderated by Ellen Teller, Director of Government Affairs, Food Research and Action Center.

If you are not familiar with CHN's webinar or the annual data release of poverty information from Census, here's a bit of information about what you can expect if you sign up and participate. The webinar will help you:

* to find and understand national numbers and the findings for your state when they're released on August 26
* to see accurate trends over time; whether your state fares better or worse than the national average
* to compare the new data (from 2007) with what we know about the economic woes of 2008, and
* how to talk about the new findings to help build the growing movement for a national commitment to dramatically reduce U.S. poverty.

To sign up to participate and for more information, see CHN's webinar webpage.

The Bush administration announced yesterday that it will not enforce new requirements that would have made it more difficult for states to enroll children in the State Children's Health Insurance Program (SCHIP). USA Today reports that the administration will not be taking "compliance action" at this time on regulations that would have forced states to wait until children are uninsured for one year before being covered by SCHIP and also require states to enroll 95 percent of extremely low-income children in the state before expanding health care coverage to only somewhat low-income families:

The directive was aimed at 15 states that extended health insurance to children in families with incomes above 250% of the federal poverty level — $44,000 for a family of three.

Many governors and Democratic lawmakers criticized the administration's new guidelines as impossible to meet. They said the final result would be that more children would go without health coverage as states rein in their programs.

With the deadline fast approaching, the administration made clear that states were under no immediate threat of losing federal funding.

We commented at the end of July about how Democrats in Congress really dropped the ball in using the Congressional Review Act to impede the Bush administration's efforts to keep kids from having health care. Fortunately, at least for the time being, it looks like they are off the hook.

The Bureau of Labor Statistics (BLS) released data for inflation and real earnings this morning, while the Labor Department reported on unemployment insurance claims for the past week.

Inflation: Consumer prices continue their steep advance as prices jumped 0.8 percent in July, pushing the annualized rate to 10.6 percent (yikes!). The jump in consumer prices was largely driven by food and energy, and when those items are subtracted inflation clocks in a high, but not scary, 3.5 percent. BLS Release: Consumer Price Index: July 2008 Commentary: Dean Baker at CEPR
Real Earnings: Workers' pay took a hit in July as real average weekly earnings fell by 0.8 percent. The 0.3 percent increase in average hourly earnings couldn't keep up with the 0.3 decrease in aerage weekly hours and the 0.9 percent in prices. BLS Release: Real Earnings in July 2008
Unemployment Insurance Claims: Last week, 450,000 workers claimed unemployment insurance for the first time -- 10,000 fewer than the previous week. The four-week moving average of initial jobless claims rose to 440,500, an increase of 19,500 from the previous week's revised average of 421,000. Workers who continue to collect unemployment insurance advanced to 3,417,000, an increase of 114,000 from the previous week. Department of Labor Release: Unemployment Insurance Weekly Claims Report Commentary: Andrew Samwick at Capital Gains and Games

The OMB Watch Fiscal Policy Program is looking for an intern for the fall of 2008. Yup, that's right. This is your chance to get in on the ground floor at one of the most dynamic nonprofit watchdog groups in Washington, DC. We're looking for energetic undergraduate or graduate students who have excellent writing, critical thinking, and communications skills, and who are dedicated to public policy and government accountability (see current intern Josh at right for example).

The internship is unpaid, but you'll have the chance to gain first hand experiences and take on significant responsibilities related to a number of different aspects of policy analysis in DC. Plus, you'll get a chance to write for the BudgetBlog - what could be better?

Interested? Learn more about the position and how to apply.

In response a requrest from the Senate Budget Committee, CBO has a issued a report on contractors working in Iraq. From 2003 to 2007, the federal government awarded over $85 billion in contracts, and with a burn rate of $17-21 billion per year, it's likely that $100 has been doled out to private contractors since the start of the war.

The report is thorough analysis of on what and by whom that money is being spent. CBO sliced the data by:

• Which federal agency is awarding contracts (The DoD has awarded $76 billion in contracts with the Army obligating 75 percent of that amount)
• Location of where contract was performed ($63 billion in Iraq, $14 billion in Kuwait, and $8 billion in other countries in the Iraq theater*)
• The types of products and services provided by contractors (about $25 for Professional, Administrative, and Management Support, $20 billion for Uncategorized or Miscellaneous, with the rest falling in some 97 other categories)

CBO's report also quantifies the extent to which contractor personnel are in theater. CBO estimates that there are some 190,000 people working for contractors in the Iraq theater, of which about 20 percent are U.S. citizens. In fact, the ratio of contract personnel to military is 1 to 1 -- a level some 3.9 times higher than the historical average.

Upon the release of the report Senate Budget Committee Chair Kent Conrad (D-ND) issued a press release summarizing the potential pitfalls of outsourcing on such a massive scale:

There are billions of taxpayer dollars being funneled to both American and foreign companies, often through no-bid contracts. Ongoing Pentagon audits have revealed that vast sums of this money have been misspent or improperly recorded. The American people deserve a better accounting from this Administration of who these contractors are, why they are being used instead of U.S. troops, how they are being monitored, and whether they represent a cost-effective use of American resources.

*A region in the Middle East including Iraq, Bahrain, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, Turkey, and the United Arab Emirates

It's been a slow day here at the Budget Brigade, so I thought I'd bring your attention to the lastest round of quarterly "scores" agencies receive on the President's Management Agenda (PMA) scorecard. These scores measure the implementation of the PMA, or how well the major agencies are "executing the five government-wide management initiatives." Robert Brodsky from Government Executive Magazine has a rundown of the latest scores, which are not too good:

Many federal agencies have taken a step backward on the Bush administration's five major management initiatives, according to quarterly grades released on Thursday by the Office of Management and Budget.

There were 14 downgrades on the status section of OMB's management score card for the third quarter of 2008, which ended June 30. And there were only six instances in which grades improved.

The problems were limited to two areas of the President's Management Agenda: human capital and electronic government.

Clay Johnson, OMB's Deputy Director for Management, cautioned that the "scores" shouldn't be seen as "scores," but as opportunities for improvement.

"The score cards aren't about compliance or getting to a score -- it's about results that agencies are producing," Johnson said. "So, a dip in a score shouldn't always be viewed in the negative, but as a way to [make] progress and improve effectiveness."

Hmmmm...

P.S. For all you home-gamers out there, the administration's "competitive sourcing" initiative has been renamed to the new and improved Commercial Services Management initiative. Same waste of money, great new name.

The Congressional Budget Office (CBO) released their monthly budget review this morning. CBO Director Peter Orszag blogged on the release of the review on the CBO Director's Blog:

CBO estimates that for the first 10 months of fiscal year 2008, the federal budget deficit was about $371 billion—$213 billion more than the deficit recorded over the same period in 2007. While revenues were about 1 percent lower than in the same period last year, outlays over the same period have grown by almost 9 percent. CBO estimates that the federal budget deficit for fiscal year 2008 will be in the vicinity of $400 billion, close to the amount we projected last March after accounting for proposed supplemental appropriations.

CBO estimates that a deficit of $102 billion was recorded for ythe month of July, about $65 billion more than recorded in July 2007; approximately $14 billion of that increase was due to rebate payments resulting from the Economic Stimulus Act of 2008. Receipts were about $5 billion lower than those in July 2007; without the rebates, receipts would have been up by 2 percent. Outlays in July were $61 billion higher than in the same month last year; about $21 billion of that difference was the result of calendar-related shifts in the timing of certain payments. Another major factor contributing to the increase was the $15 billion disbursed in July 2008 by the Federal Deposit Insurance Corporation (FDIC) to cover insured deposits at failed financial institutions; much of that cost should be recovered in the future as the FDIC liquidates the assets held by those institutions and collects higher insurance premiums.

CBO: Monthly Budget Review

Most of the popular/mainstream commentaries about Congress is that they don't their jobs - that they need to do more for the American people. We certainly have been highly critical of Congress for repeatedly not getting enough work done during the year by repeatedly failing to pass the most basic legislation that is required of them - the annual budget resolution and appropriations bills (see here, here, and here).

Which is why a post by Jim Harper over on Cato's blog caught my eye the other day. According to Harper, Congress introduced its 10,000th bill on July 30, right before they skipped town for the August recess. The 110th Congress is on pace to break the all-time record for number of bills introduced (10,537) set by the 109th Congress from 2005-2006.

The current Congress is on pace to easily beat the record 10,537 bills introduced in the 109th Congress. In the 109th (2005-2006), the 10,000th bill was introduced on September 18th, well after the August recess.

The number of bills introduced in each Congress has been rapidly increasing over the last twelve years. In the 104th Congress (1995-1996), there were 6,542 bills introduced. In the 105th (1997-1998), 7,529. The 106th (1999-2000), 107th (2001-2002), and 108th (2003-2004) saw bill introductions in the high 8,000s, and in the 109th (2005-2006), the number of bills first pierced through 10,000.

So, if I'm doing my math right, and I like to think I am, the number of bills introduced by Congress has increased 61 percent since the 104th Congress in 1995/1996. Yet there haven't been any additional members of Congress over that period - it's still 535 (plus 5 territorial representatives). So, one way of looking at it is that our legislators have increased their output from 12.11 bills per session to 19.51 bills per session. Talk about getting your money's worth for all you political contributors out there.

Yet the timeliness and quality of the bills Congress actually enacts has sharply decreased during that time. Congress hasn't enacted all of the annual appropriations bills on time since 1994 and as a country we're in more debt now than ever before, having added $4.23 trillion to the national debt in just the last 8 years. It seems this is a situation where less really is more.

Lurita Doan is back in the news. I know, I can't believe it either. But wait until you hear why and what she is saying now. It seems she is headlining a 15-minute segment on Federal News Radio (1050 AM in DC) where she will share her views on, get this, government leadership. I'm not making this up. That's like having Jack Abramoff lecture on ethical/legal congressional fundraising tactics. The segment, entitled "Leadership Matters," will run at 7:28 am on Tuesday mornings, according to this Federal Times article from last week.

Doan's got a snappy new photo (at least I think it is new) up on the Federal News Radio Leadership Matters website and she's gotten through two segments so far, both of which have some unbelievable jewels that I would be remiss if I didn't ridicule.

The first commentary was on business "guru" Peter Drucker and how to institute cuts to government programs, I mean management reform. The first thing about this commentary is that it seems Doan really believes government is a business. While there at least could be an argument that the General Services Administration, the agency she used to run, should be structured like a business, government is not a business. It isn't. Citizens are not "customers." And pretending these things are true and assuming you can apply successful business practices to government and things will work just fine isn't a good idea. For example, Doan says:

But with a little more Drucker, leaders at all levels can see the wisdom of taking the harder road of moving resources, both financial and human capital, to where they can bring the most value, to redeploy these resources to programs that offer the biggest possible value to American taxpayers, and terminating programs that have continued for years even thought they no longer deliver the originally promised results.

I almost don't know where to being here. This is just too ironic. Let me give it a shot - as Ms. Doan says, nothing happens until you commit to it.

Doan tried to "move resources" to where they can bring the "most value" while at GSA. She interfered twice with contract proceedings while heading up the agency, first to give a no-bid contract to her friend (see here and Washington Post coverage), and then to force the government to continue a contract with Sun Microsystems after evidence had been uncovered that Sun was overcharging the government (see here, here, and this excellent Washington Post coverage).

Doan also tried to "redeploy" resources away from the GSA Inspector General's office, a practically unprecedented move in government, because she was tired of that office launching investigations into her pretty blatant misconduct at GSA Administrator (see here, here and here). After being widely criticized for these actions, Doan fell back on the claim she was simply trying to cut the GSA's budget and save taxpayers money. Is this the type of cuts Doan is thinking of when she recommends the new administration "[put] the responsibility for cutting the budget squarely on the shoulders of each agency head" later in her commentary?

Finally, Doan went so far as to break federal law by attempting to use federal resources (both "financial" and "human") to help elect Republicans to federal office. (see here, here, here, and yet more Washington Post coverage).

None of these decisions were "wise," nor did they "bring the most value" to American taxpayers. Maybe that's why President Bush, of all people, ended up firing Doan with only a few months left in his presidency. You know things are bad when Bush won't stand up for you - case in point - he's still campaigning for indicted Sen. Ted Stevens (R-AK).

I'll have to save my reactions to Doan's second commentary for another post - there was just too much to say about the first. One final note. Doan references that there are "barely ten days" to accomplish a more disciplined federal budget at the very end of her commentary. I have no idea what ten days she is talking about here. If you have an idea and can help me out, shoot us an email at budgetblog (at) ombwatch.org.

(h/t to Neil Gordon over at POGO's blog)

In rare fit of, umm, action on their constitutionally-mandated duty to provide funding for the federal government, the House of Representatives passed the FY 2009 Militarty Construction-VA appropriations bill. The $72.7 billion measure passed Friday afternoon 409-4.

Jobs data released this morning show that the economy continued to a seven-month trend of shedding jobs. July's bottom-line job-loss number was mitigated by an increase of 25,000 government jobs; private sector employment dropped by 76,000. Since January, the economy has lost 463,000 jobs.

The unemployment rate also moved upward from 5.5 percent to 5.7 percent. In the past year, the unemployment rate has rise 1.0 percent as 1.6 million workers have become unemployed.

(click to enlarge)