TPC Releases New Long-Term Federal Budget Projections

 

The Tax Policy Center (TPC), a joint project of the Urban Institute and the Brookings Institution, released a new report yesterday examining the nation's budget outlook over, what TPC describes as, "10-year and long-term horizons." The paper, whose title recalls a famous Yogi Berra quote, examines these horizons under three sets of assumptions: the Congressional Budget Office (CBO) baseline, an extended policy scenario, and the administration's FY 2011 budget proposal.

Unfortunately, none of the projections made under the three sets of assumptions is very encouraging, and reading the report makes one really hope for the president's new debt commission to produce results. Besides that, though, there are a couple interesting points to pick out from the paper, which was authored by economists Alan Auerbach and William Gale.

It's the Budget, Stupid!

First, Auerbach and Gale observe, "The long-term fiscal gap – the size of the immediate and permanent change in spending or taxes needed to keep the long-term debt/GDP ratio at its current level – is in the range of 6-9 percent of GDP." If you assume current gross domestic product (GDP) – the yearly sum of the country's economic output – to be somewhere in the neighborhood of $14.6 trillion, then to keep the long-term debt/GDP ratio at current levels, which is around 60 percent, then Congress will have to adjust spending or taxes by roughly $876 billion to $1.3 trillion.

Looking at those numbers, it's fairly obvious that the above scenario for adjusting spending and taxes is not an either-or situation. Members of Congress are going to need to both reduce spending, mandatory and discretionary, and raise taxes to keep the long-term debt/GDP ratio from approaching levels that economists can't say for sure wouldn't produce catastrophic consequences.

One of the ways to reduce mandatory spending is to lower the amount of money the government spends on health care. Indeed, reductions in health care costs can go a long way in achieving that long-term debt/GDP ratio balance. In their second point, though, Auerbach and Gale declare, "the problem is far too large to be solved by plausible reductions in health care spending alone."

I don't know of any economists or analysts that predicted health care reform would be a silver bullet for the country's long-term debt problems. I do know that the president argued that in order for his administration to even begin to tackle deficits, and in turn deal with the debt, he needed health care reform to pass, but I'm quite sure that lawmakers realize they are going to have to address other budget areas as well.

Finally, Auerbach and Gale exhort lawmakers to address the long-term debt issue soon. They claim, "Postponing the onset of a fiscal package will make the problem even harder: even just a 5-year delay in implementation would raise the required fiscal adjustment by about 0.4 percent of GDP, or almost $60 billion per year."

Look, I realize that the long-term budget outlook is a disaster, but comments like the above only reinforce what is the new conventional wisdom on Capitol Hill: that recent spending has caused current deficits and Congress must slash discretionary spending to deal with it. Moreover, comments about immediacy strengthen the hand of deficit hawks, like those great folks over at the Peter G. Peterson Foundation, who want to use the current situation to gut and privatize this country's fragile and shrinking social safety net.

There are different ways to go about bringing the deficits and debt under control. One way would be to lower discretionary spending to painful levels and destroy Medicare and Social Security, all while continuing to dump hundreds of billions of dollars into wasteful and unproductive defense and homeland security programs. Another route, which unfortunately isn't getting a lot of attention, is to make the rich and large corporations pay their appropriate share, while cutting some of the more egregious military spending. Let's address the country's long-term debt, but let's do it in a sensible way that doesn't devastate the poor and downtrodden and leave's the middle class more vulnerable to the wealthy and big business.

Image by Flickr user WELS.net used under a Creative Commons license.

(Gary Therkildsen 04/30/10; 17 comments)

Pollution and Justice 101

 

The Environmental Protection Agency (EPA) will be conducting a webinar to instruct the public on how to use the pollution information in the agency's Toxics Release Inventory (TRI) to support environmental justice efforts. In addition to teaching the basics about TRI, the webinar will feature real life examples of how communities have used TRI to address environmental justice concerns. We have encouraged EPA to reach out to the public and publicize the data and tools the agency provides; this webinar is an excellent opportunity for any citizen or public interest group to learn about a very valuable advocacy tool at their disposal.

The TRI tracks toxic pollution from thousands of facilities nationwide and makes the information available to the public. EPA has developed several online tools that help citizens search the data and apply the information to the needs of their specific communities. Much research has confirmed that poorer neighborhoods and minority neighborhoods are exposed to higher levels of pollution than other neighborhoods. EPA administrator Lisa Jackson has made addressing these environmental justice issues a priority.

Although we encourage the use of Internet technologies and tools such as webinars, it is unfortunate to note that many of the citizens living within environmental justice communities lack easy access to computers or the Internet. In-person meetings conducted by EPA in these communities are another important approach. Lisa Jackson has exemplified this by visiting many impacted communities as part of an ongoing environmental justice tour.

The webinar will be May 25, 2010 from 1:00 to 3:00 pm EDT. The Environmental Council of the States (ECOS) is co-hosting. For more information and to register online, go to http://www.chemicalright2know.org/content/webinar/spring2010.

(Brian Turnbaugh* 04/30/10; 0 comments)

Obama on Oil Rigs: Who Knew These Things Could Leak?

 

President Obama is backing away from earlier plans to permit new offshore drilling amid growing concerns that oil spilling from the Deepwater Horizon oil rig in the Gulf of Mexico will soon reach the Louisiana coast, exacting serious environmental damage. Obama political advisor David Axelrod said today, “No additional drilling has been authorized and none will [be] until we find out what happened here and whether there was something unique and preventable here."

oil spill This whole thing makes the administration seem incredibly naive. The only thing that has changed in the past few weeks is that an eventual reality has become an actual reality. Conservationists, and plenty of folks with old-fashioned common sense, feared an oil spill like this one.

Those who oppose new off-shore drilling and who could have guessed a major oil spill might occur know how little oversight exists for existing oil drilling operations. As ProPublica reports, regulators at the Department of Interior a few years ago passed on an opportunity to require a device for oil rigs that could have quickly stopped the spill. The device, called an acoustic control, is required in other countries including Brazil and Norway.

Lost in all the concern over the environmental impacts of the oil spill is the human toll. 11 workers are still missing as a result of the rig explosion. A lawsuit filed by the wife of one worker claims the owner and operator were negligent, in part for “failing to ensure that its crew worked in a safe and prudent manner.” An Interior report on safety in the offshore drilling industry found that “there were 41 deaths and 302 injuries out of 1,443 incidents from 2001 to 2007,” according to the Huffington Post.

BP, owner of the Deepwater Horizon rig, has opposed new safety regulations, arguing in favor of voluntary programs, Huffington Post reports. Last year, the Occupational Safety and Health Administration fined the oil giant a record $87 million for a Texas refinery explosion that killed 15. As I blogged yesterday, OSHA and other Labor Department agencies have pledged to crack down on companies who flaunt regulation. BP is certainly earning a reputation that should put it on OSHA’s radar.

Based on Axelrod’s comments, it appears likely the Obama administration will revive its plans to permit new drilling after the investigation into the Deepwater explosion is complete. If Obama does decide to permit new drilling, his administration must first put in place the rules necessary to assure the greatest possible protection for workers and the environment.

Image by Flickr user Blind Grasshopper; used under a Creative Commons license.

(Matthew Madia 04/30/10; 6 comments)

Labor Pushing Proactive Agenda during a Dark Time for Workers

 

It doesn’t seem like a very safe time to be an American worker. Yesterday was Workers Memorial Day, and the news is filled with stories about why such a day is necessary. Seth Harris, Deputy Secretary of the Labor Department, called it a “somber time” in an event today at the Center for American Progress.

Whether in spite of these tragedies or because of them, Labor Department officials appear to have a renewed enthusiasm for protecting America’s workers. Officials used the Center for American Progress event to tout Labor's spring rulemaking agenda (part of the semiannual Unified Agenda of Regulatory and Deregulatory Action we’ve also blogged about this week). Several rules on the agenda reflect Labor’s new regulatory philosophy of “plan, prevent, protect,” Harris said.

The rulemaking agenda for the Occupational Safety and Health Administration (OSHA) is filled with many of the same regulations the agency has been working on for years. Rulemakings to set exposure standards for silica dust and beryllium, and new safety standards for shipyard employees and construction workers continue to progress in fits and starts.

But at the Center for American Progress event, OSHA chose to highlight a new entry on the agenda, the Injury and Illness Prevention Program, which if finalized will require employers to maintain and follow safety plans that incorporate best practices and aim to protect workers from any hazard they may face on the job. The program is still a long way from becoming a reality, but it may mark the beginning of a broader and more holistic approach to health and safety for OSHA.

The Mine Safety and Health Administration (MSHA) is planning a rule to address a major procedural flaw that has drawn attention in the wake of the Upper Big Branch mine explosion that killed 29 workers earlier this month. The agency will attempt to close a loophole whereby mine operators keep themselves off MSHA’s pattern-of-violations list by challenging safety violations. MSHA projects it will propose a new pattern-of-violations rule by January 2011.

The Wage and Hour Division, the Labor agency responsible for minimum wage, child labor, and other fair labor standards, is attempting to limit the misclassification of workers. Businesses can currently deem workers consultants or independent contractors, even if those designation are inappropriate, in order to deny them the same rights a typical worker would receive.

On the enforcement front, the message from the Labor Department officials was clear: Labor agencies will clearly communicate expectations for regulated businesses and do what they can to help those businesses understand what they need to do to comply. But for those scofflaws who flaunt laws and regulations (I’m looking at you, Massey Energy) Labor will use the tools at its disposal to force compliance and take punitive action if necessary.

(Matthew Madia 04/29/10; 0 comments)

After Much Delay, the DISCLOSE Act is Introduced

 

In front of the Supreme Court, Sen. Chuck Schumer (D-NY) announced the introduction of legislation meant to diminish the impact of the U.S. Supreme Court decision in Citizens United v. Federal Election Commission. The much anticipated bill is titled as expected, the DISCLOSE Act, which stands for Democracy Is Strengthened by Casting Light On Spending in Elections. Four Democrats signed on as co-sponsors, including Sens. Ron Wyden (D-OR), Russ Feingold (D-WI), Evan Bayh (D-IN) and Al Franken (D-MN). The bill creates broad new disclosure requirements for corporations, unions, 501(c)(4), (5), (6) and 527 organizations that spend money on independent expenditures or electioneering communications to influence federal elections.

The DISCLOSE Act would prohibit foreign-controlled corporations, and entities with a government contract worth $50,000 or more from making political expenditures. Those who received funding under the Troubled Asset Relief Program (TARP) and have not paid back the government funds, are also banned from political spending.

The heads of any organization sponsoring a campaign ad, as well as the top funder of the message, would be required to appear on screen to deliver a "stand by your ad" disclaimer. In addition, the top five donors to the group would have to be identified.

Expenditures that cost $10,000 or more made more than 20 days before an election, and expenditures of $1,000 or more made within 20 days before an election, will have to be reported to the Federal Election Commission (FEC) within 24 hours.

An organization can establish a separate "Campaign-Related Activity" account to receive and disburse political expenditures. All donations to these accounts of $1,000 or more earmarked for political activities, and all expenditures funded through these accounts, would have to be reported.

They hope the bill will pass Congress by July 4 and be enacted before the midterm election. However, this is a very ambitious schedule. President Obama issued a statement urging Congress to act quickly. "Passing the legislation is a critical step in restoring our government to its rightful owners: the American people."

The bill includes a provision that OMB Watch has been supporting for years, the requirement that Senators file their campaign finance reports electronically to the FEC. Some other highlights of the bill include

  • Federally registered lobbyist must disclose any election spending costing more than $1,000, and the name of candidate or campaign supported or opposed.
  • Expenditures must also be disclosed to shareholders and members of the organization in periodic or annual financial reports.
  • The organization must have information on its website regarding the expenditures within 24 hours of reporting to the FEC.

For more details, an outline of the bill is available at the end of Schumer's press release. And in the House, a similar bill has been introduced by Rep. Chris Van Hollen (D-MD) and joined by Reps. Mike Castle (R-DE), Walter Jones (R-NC), and Robert Brady (D-PA).

Hopefully the final legislation can adequately respond in a way that protects advocacy and can hold up to constitutional challenges. Justifiably, the corrupting influence of money in politics must be addressed.

(Amanda Adams* 04/29/10; 0 comments)

More Citizens are Using the Internet to Engage with Government

 

The Pew Research Center's Internet & American Life Project released a new report which found that most Internet users have visited a government website to get information or complete a transaction during the last year. The findings are based on a survey of 2,258 adults 18 or older. According to the report, about a quarter of adults have posted their own comments online about government issues, participated in an online town hall meeting or joined a group that tries to influence policies.

Some other interesting findings include:

  • 48 percent of Internet users have looked for information about a public policy or issue online with their local, state or federal government.
  • 31 percent are taking advantage of social media tools to keep up with government news.
  • 22 percent have read or downloaded a piece of legislation.
  • 14 percent have looked online to see who is contributing to certain elected officials.

Pew Research Specialist Aaron Smith said, "People are not only getting involved with government in new and interesting ways, they are also using these tools to share their views with others and contribute to the broader debate around government policies."

Fully 95% of government social media users visited a government website in the preceding twelve months, with the typical government social media user visiting five such websites. Additionally, two-thirds (66%) contacted a government agency or official in person, by phone or by letter in the last year.

Download the report here.

(Amanda Adams* 04/28/10; 0 comments)

Meat and Poultry Agency Struggles without Leader

 

Without a Senate-confirmed head, rulemaking at the Food Safety and Inspection Service (FSIS) has ground to a halt. FSIS, the agency responsible for ensuring the safety of meat, poultry, and egg products, made progress on only one significant regulation in the past six months, according to the semiannual Unified Agenda of Regulatory and Deregulatory Actions published Monday.

President Obama did not nominate Elisabeth Hagen to serve as USDA’s Under Secretary of Agriculture for Food Safety, a.k.a. the head of FSIS, until Jan. 26, 2010, more than a full year after he took office. Now, Hagen’s nomination awaits a hearing and vote in the Senate Agriculture Committee.

FSIS’s last Unified Agenda, published in October 2009, listed 22 ongoing rulemakings. The agency set 22 target dates for 21 of those rules (one rulemaking had two projected actions, and one had none). 11 of those projections were to have been met sometime between October 2009 and April 2010.

According to the new Unified Agenda released this week, FSIS missed all 11 target dates, and has taken action on only one of those rules – a proposal to require companies to notify the government if they learn a meat or poultry product is contaminated or has been mislabeled. The target dates for the other ten rulemakings have been rescheduled. Of the other, longer term rulemakings, FSIS has further delayed several timetables, some into 2011. FSIS did not add any new rulemakings to the latest Unified Agenda.

(The White House Office of Information and Regulatory Affairs (OIRA), the office responsible for reviewing agency draft proposed and final regulations, does not appear to be doing FSIS any favors. FSIS could have met its target date for the proposed rule on notification of contaminated products, but OIRA spent almost 3 months reviewing the rule. For a proposed rule on statutorily mandated catfish inspections, OIRA has been reviewing the proposal since November 2009.)

There is not necessarily anything wrong with an agency missing a target date it sets in the Unified Agenda, especially if agency staff is using the extra time to make the rule better. But when an agency accomplishes as little as FSIS has these last six months, it begs the question, What is the hold up?

One can only assume FSIS is struggling in the absence of leadership. While top deputies have been running FSIS in the meantime, regulatory agencies like FSIS need full-time, Senate-confirmed heads to set an aggressive rulemaking agenda (and to butt heads with OIRA if need be). The Senate Agriculture Committee needs to get off its duff and approve Elisabeth Hagen’s nomination, and the full Senate must follow.

(Matthew Madia 04/28/10; 2 comments)

Supreme Court Denies Review in Challenge to FEC Rules

 

The Supreme Court sent back to a lower court a case originating from the 2008 presidential election, challenging Federal Election Commission (FEC) disclosure rules. A 527 organization, the Real Truth About Obama (RTAO), wanted to sponsor ads covering President Obama's record on abortion and other issues. After the group lost their appeal of a federal district court decision, RTAO requested the Supreme Court to review the case.

The case challenges regulations regarding when a group must register as a political committee, and the enforcement of reporting requirements for political organizations, including 527s. RTAO argues it is not a political committee because it did not plan to advocate for Obama's defeat or election.

The Supreme Court justices said that the Fourth Circuit should reconsider the case in light of the ruling in Citizens United v. FEC and the fact that some of the challenged regulations have been removed.

Last month, U.S. Solicitor General Elena Kagan filed a brief with the Supreme Court urging the rejection for their appeal. Kagan defended the definition of express advocacy and political committee status enforcement policies by arguing that an organization with a major purpose of federal campaign activity should be required to comply with the contribution limits and disclosure requirements applicable to political committees. Kagan stated that other court decisions since 2008 have led to the FEC's to determination that it will no longer enforce two of the provisions at issue in the case.

The Court decided in Citizens United that corporations cannot be banned from financing express advocacy, but it did not redefine what types of communications can be subject to disclosure, and therefore the express advocacy standard was not changed.

The Campaign Legal Center warns that while, "two claims brought by RTAO certainly have been mooted by intervening decisions, the Supreme Court's action should not be read by the Fourth Circuit as an invitation to further weaken the remaining FEC regulations under challenge."

Meanwhile, the Supreme Court heard oral arguments today (April 28) in another case which also deals with disclosure and political activity. In John Doe No. 1 v. Reed, petition signers challenged the constitutionality of Washington's Public Records Act, which requires state and local governments to make public the identities of those who sign a referendum or initiative petition. For a great description of the issues involved in the case and some background, read this blog post from SCOTUSblog.

(Amanda Adams* 04/28/10; 0 comments)

Treasury Begins to Sell Citigroup Stock

 

As discussed in a recent Watcher article, Treasury is starting to divest itself of Citigroup assets. The news came out on Monday, with Citi's stock price at $4.86, but at the close on Tuesday, the price had plunged to below $4.40 a share. While we're nowhere near the "break even" point of $3.25 a share, at which point Treasury will begin losing money on the sale, it's a bad trendline. Hopefully, the stock will rebound as the sale progresses over the coming months.

(Sam Rosen-Amy 04/27/10; 0 comments)

Coal Ash Rule Still on Track?

 

The U.S. Environmental Protection Agency still plans to issue a proposal for the regulation of coal ash in the coming weeks, according to the agency’s most recent regulatory agenda.

TracksEPA projected an April release date for the proposal. The timeline is found in the semiannual Unified Agenda of Regulatory and Deregulatory Actions which Executive Branch agencies published today. The details of the proposal are not indicated.

EPA’s coal ash proposal has been held up since the agency sent a draft proposed rule to the White House Office of Information and Regulatory Affairs (OIRA) on Oct. 16, 2009. Proponents of coal ash regulation have criticized OIRA for its handling of the EPA rule. OIRA has missed internal deadlines for approving or denying the proposal all the while meeting with industry representatives (and environmental and public health advocates) on dozens of occasions. The protracted review has caused fear that the White House may quash or water down EPA plans to regulate the management and disposal of coal ash – a toxic byproduct of coal combustion.

I’m not sure how to interpret EPA’s projected release date. Does the agency really believe it can unveil a proposal this week, or is it trying to avoid the appearance that OIRA is going to continue to delay the rule? More importantly, the Unified Agenda does not give detailed information on rules that agencies have yet to make public, so we cannot know whether the OIRA review has had an impact on the substance of the coal ash rule.

Other items of interest from EPA’s 342-entry section of the Unified Agenda:

  • EPA projects that it will officially withdraw in May a regulation that allows certain classes of hazardous wastes to be burned instead of properly handled and disposed of. The original rule was one of the Bush administration’s midnight regulations.
  • EPA says it will finalize in May greenhouse gas emissions standards for stationary industrial sources like factories and oil refineries. A draft of the final rule was sent to OIRA last week.
  • EPA projects that it will tighten the national air quality standard for ozone, or smog, in September.
  • Among the 43 brand new entries for EPA, the agency plans to propose greenhouse gas standards for heavy duty vehicles (a follow-on to its recent passenger vehicle standard), add phthalates and bisphenol-A to its list of Chemicals of Concern, and propose standards for new uses of nanomaterials, an emerging class of substances that have gone largely unregulated. 

We’ll have more information on other agencies’ Unified Agenda sections later in the week. If you’ve found anything new or interesting, leave it in the comments.

Image by Flickr user sean dreilinger; used under a Creative Commons license.

(Matthew Madia 04/26/10; 1 comment)