Blog Posts and Analysis / Revenue & Spending

The Bush Budget Legacy: Misleading Claims and Misguided Priorities

On Feb. 4, President Bush laid out, in a rather slender volume, his federal budget proposal for Fiscal Year 2009, which begins on Oct. 1. Unfortunately, Bush has made little progress toward constructing an honest, fiscally responsible budget that meets the needs of America's communities. In fact, criticisms identical to those levied a year ago against his FY 2008 budget are still quite suitable in their application today — Bush's assumptions about war spending and Alternative Minimum Tax (AMT) reform are unrealistic if not outright spurious. His attempt to balance the budget by 2012 requires massive cuts to Medicare, Medicaid, and other popular domestic investments Congress will certainly not enact. His proposal to terminate or radically cut 151 federal programs is fantastical — wholesale cuts to popular discretionary programs are not only unlikely but are irresponsible in the face of worsening economic conditions.

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Stimulus Status: The Eye of the Storm

Momentum in Congress to pass a fiscal stimulus plan has halted for the moment, with the nation's political attention focused on the biggest primary day ever and, to a lesser degree, on the release of the president's FY 2009 budget proposal. Indeed, because Super Tuesday has three senators hop-scotching around the country, Senate leaders have put off an expected showdown over the plan until Wednesday, Feb. 6.

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Bipartisan Consensus on Stimulus Package Gathers Momentum

Amid slumping capital markets and real estate values, a jump in unemployment, and a growing chorus of economists forecasting a recession in the U.S., a consensus has rapidly developed in Washington during the first few weeks of the year that a fiscal stimulus package is in order. The watchword in Washington has been "bipartisanship," and President Bush and the congressional Democratic leadership have already made concessions. Some questions remain regarding the optimal structure and size of the package, but indications point to its enactment in a matter of weeks.

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Lack of Resources and Poor Policies Hurt IRS Mission

A lack of enforcement resources, misplaced priorities, and inefficient policies at the Internal Revenue Service (IRS) are among the factors perpetuating the federal tax gap, according to a new OMB Watch report released Jan. 15. The report, Bridging the Tax Gap: The Case for Increasing the IRS Budget, illustrates why the IRS has had such a difficult time recovering the more than $300 billion in federal taxes that go unpaid every year and offers some practical solutions to the problem.

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Temporary and Targeted: The Basics of an Economic Stimulus Package

The release of dismal national jobs data on Jan. 4 has prompted rumblings from politicians in Washington about the need for an "economic stimulus package." On Jan. 7, President Bush and Treasury Secretary Henry Paulson delivered separate speeches on the state of the economy, in which they addressed the basic outlines of a fiscal policy designed to mitigate the effects of a possible recession. Bush announced he is taking a stay-the-course approach while economists from across the political spectrum are calling for some type of stimulus package. The president could still offer a plan in his State of the Union speech at the end of January.

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Despite New Majority in Congress, Fiscal Policy Still Mostly Stuck in Neutral

A new congressional majority in 2007 promised a clean break from past practices of a Congress noted for its corruption, dysfunction and profligacy. It moved on a modest agenda and successfully enacted a few important policies, but overall, it failed to chart a new direction in fiscal policy. This failure was due in large part to the majority underestimating the ability and willingness of a coalition of conservative policymakers and the president to fiercely obstruct even the modest reform policies on the new Congress's agenda.

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FedSpending 3.0 Goes Public

On Nov. 29, OMB Watch launched the third upgrade of its FedSpending.org website, which allows the public to search federal spending data, since the site was created a year ago. The new version includes approximately $16.8 trillion in spending data, including annual spending from FY 2000 through FY 2006 for both contracts and federal assistance, with partial contracts data for FY 2007. Major feature upgrades of this version include mapping, expandable summary tables and a more powerful "SuperSearch."

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