Blog: The Fine Print / Revenue & Spending

Federal Decisions Impact State Budgets

Apr 25, 2008 by Craig Jennings

There were a slew of articles today from around the country about the impact of federal budget cuts on local communities, particularly for local education programs (see below). These articles detail the impact of cuts on a wide variety of programs and constituencies, from summer school to youth vocational education, from a rape crisis hotline to arts and music classes, from school counseling to early-reading instruction.

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DAILY FISCAL POLICY REPORT -- April 25, 2008

Apr 25, 2008 by Dana Chasin

Economy -- Home Sales, Values Plunge: A key cause of the economic slowdown worsened last month as the Departments of Commerce and Housing and Urban Development reported yesterday that home sales fell to their lowest levels in over 16 years. Home sales have dropped 36.6 percent in the last twelve months. Home prices are down 11.3 percent during the same period. Among the fiscal impacts of the housing sector contraction: state coffers suffer as property tax revenues shrink along with values and foreclosures reduce the net number of homeowners. Sad Stats.

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Feds Return Virtual Border Fence to Boeing

Apr 24, 2008 by Adam Hughes*

Here's a short item reported ($) in CongressDaily yesterday afternoon that as escaped most mainstream media coverage. Apparently the federal government, specifically officials at the Customs and Border Protection office, have decided to scrap continued work on a brand new, $20 million virtual fence along the Arizona-Mexico border. The initiative, called Project 28, was awarded to Boeing, Inc., as part of a $67 million contract to provide advanced border protection technologies.

Project 28 has experienced repeated delays (in June 2007 and again in February 2008) due to technical problems and software glitches since it began about 18 months ago, and now that the government has accepted the program infrastructure from Boeing, it found out it doesn't work. The Government Accountability Office (GAO) has testified before Congress that the technology provided under the contract "did not fully meet user needs and the project's design will not be used as the basis for future" development of border protection technologies.

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Medicare Regs Bill Could be Tucked into War Sup

Apr 24, 2008 by Craig Jennings

CongressDaily is reporting ($) that language from a Medicaid bill that was overwhelmingly passed by the House yesterday may be added to the FY08/09 war supplemental bill. By placing the Medicaid language inside the spending bill, Congress would not only force President Bush to veto a war spending bill for the sake of rejecting changes to Medicaid, but it could also make Sen. Chuck Grassley (R-IA) think twice about mounting a filibuster against it.

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The Policy Implications of Statistics and Semantics

Apr 24, 2008 by Dana Chasin

Go Figure The Commerce Department announced this morning that home sales in the U.S. had slumped in March to their lowest levels in 167 months, or nearly 17 years. Today's figures are one of the last that may influence forecasts ahead of the Commerce Department's advance report on first-quarter gross domestic product due next Wednesday. Growth slowed to a 0.3 percent annual pace from January through March, the weakest in more than five years, according to the median estimate of economists surveyed by Bloomberg News. Story.

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House Moves Bill to Stop Medicaid Changes

Apr 24, 2008 by Matthew Madia

Yesterday the House passed a bill that would stop the Bush administration from going forward with several regulations intended to cut Medicaid services. The administration developed the regulations under the guise of "fiscal integrity," arguing state Medicaid programs are using loopholes to inappropriately claim federal funds. Bush has threatened to veto the bill. Fortunately, the bill passed the House in a 349-62 vote which, if the margin holds, would be enough to override a veto. State governments also support the bill. According to the Associated Press, "The governors of all 50 states…oppose the rules." If all this bipartisanship and widespread agreement make you uncomfortable, fear not — the U.S. Senate is on the case.

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A Different Kind of Veto Threat

Apr 24, 2008 by Craig Jennings

This week, Democratic Congressional leadership is mulling options for attaching domestic spending provisions to a forthcoming war supplemental bill. OMB Director Jim Nussle has warned Congress that a war spending bill that exceeds the president's remaining FY 2008 request ($108 billion) will be vetoed.

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DAILY FISCAL POLICY REPORT -- April 24, 2008

Apr 24, 2008 by Dana Chasin

Contracting -- House OKs Three Accountability Bills: The House voice voted three bills yesterday requiring those seeking federal contracts to disclose information about their companies:
  • Close the Contractor Fraud Loophole Act (H.R. 5712) -- requiring prosective federal contractors disclose their involvement in administrative and legal proceedings initiated by the federal government

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ADDENDUM: Gas Tax Cut Gets Bipartisan Rebuff

Apr 23, 2008 by Dana Chasin

Following up on Fiscal Foolery:
  • Senate Energy and Natural Resources ranking member Pete Domenici (R-NM) said today that a gas tax holiday this summer will do little to curb the soaring record prices at the pump. "You might not get the whole benefit of it because in a month or so the price might be up anyway, because the price of crude oil going up... I'm willing to listen but I don't believe it will solve the problem and I don't think it will do much for the American people."

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Fiscal Fiction: Addressing Misconceptions, Pt. II

Apr 23, 2008 by Adam Hughes*

Memo to ABC's Gibson: Capital Gains Cuts Also Cut Revenues ... in each instance, when the [capital gains tax] rate dropped, revenues from the tax increased. The government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down.... history shows that when you drop the capital-gains tax, the revenues go up.

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