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Tuesday, April 29, 2008
DAILY FISCAL POLICY REPORT -- April 29, 2008
Unemployment -- Job Loss Strain on Gov't Health Programs: A Kaiser Family Foundation study released yesterday indicates that each percentage-point rise in unemployment during the economic downturn would swell the uninsured by 1.1 million, the New York Times reports. Such an increased in the number of uninsured would require an additional $3.4 billion in spending for Medicaid and the State Children's Health Insurance Program, with $1.4 billion of it from the states. Story.
Interest Rates -- Fed on Horns of Stimulus/Inflation Dilemma: The Federal Reserve Bank will decide today whether to cut a key interest rate for the sixth time in a row, as a way to add liquidity to and stimulate the economy. A small, quarter-point cut is expected, down to two percent. The Fed has already cut rates by three percent since last summer. But inflation is now a countervailing concern for the Fed: "Inflation has been elevated, and some indicators of inflation expectations have risen [even as] the tightening of credit conditions and the deepening of the housing contraction are likely to weigh on economic growth over the next few quarters." Analysis.
War Supplemental -- Food Riots Prompt Aid Request: Responding to international strife caused by rapidly increasing food prices, Senate Majority Whip Dick Durbin (D-IL) is asking for $200 million in foreign food aid to be added to an anticipated war supplemental. In recent months, food shortages and rising prices have caused shortages in 36 nations and sparked riots in several. The funds would be in addition to $350 million in supplemental food aid requested by President Bush.
Posted by Dana Chasin
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