Monday, February 28, 2011

Why A Runaway Convention is Unlikely

From the Capitol Confidential:
  1. Article V does not authorize a constitutional convention; it authorizes a convention for proposing specific amendments.
  2. When the Founders drafted the U.S. Constitution in 1787, they specifically rejected language for Article V that would have allowed the states to later call for an open convention.
  3. Thirty eight (38) states must ratify any proposal from an amendments convention, requiring a broad consensus that makes sure an amendments convention cannot “runaway.”
  4. The limited scope of an amendments convention is underscored by the fact that it specifically says amendments cannot alter the equal number of votes for each state in the U.S. Senate without the consent of the affected state. This establishes that an Article V convention couldn’t simply rewrite the entire Constitution.
  5. The states define the agenda of an amendments convention through their applications for the convention and through the commission of delegates. Amendments conventions can be limited to specific topics.
  6. The Constitution was sold by the Founders to the ratifying states on the basis that they retained their ultimate authority over the federal government through their Article V amendment powers. James Madison in Federalist No. 43 specifically argued that states should use the power to correct errors in the Constitution. And Alexander Hamilton in the “final argument” of the Federalist Papers, in Federalist No. 85, said the Article V amendment process was the means by which the states would rein in an out-of-control federal government. One cannot take the Constitution seriously and contend that Article V was not meant to be used. It is a critical and “deal closing” element of the balance of power created by the Constitution.
  7. There is zero precedent that any convention of the states has ever “runaway” from its assigned agenda. There have been 12 interstate conventions in the history of our country. All of them stayed within their stated agenda. Even the Constitutional Convention of 1787 was not convened to “amend” the Articles of Confederation, but to “revise” and “alter” the Articles to establish an effective national government. This was fully consistent with the Articles of Confederation because the Articles authorized alterations – a term that had revolutionary significance because it echoed the language of the Declaration of Independence. The broad purpose of the Constitutional Convention of 1787 was specifically mentioned in the call of Congress and in nearly all of the commissions for the delegates for each state. The 1787 convention did not runaway at all; it did what it was charged to do – like all interstate conventions preceding it.
  8. The procedures for conducting an amendments convention are similar to Congress’ long-established rulemaking powers. Constitutional text, language and custom make clear that Congress calls the convention, setting a time and location; states appoint delegates by way of resolutions and commissions (or general state law); delegates initially vote as states at the convention; and majority votes will decide what amendments are proposed for ratification. An amendments convention is simply an interstate task force.
  9. The limited scope of an amendments convention is similar to that of state ratification conventions that are also authorized in Article V, but no one worries about a ratification convention “running away,” even though such a convention does make law.
  10. An amendments convention, because it only proposes amendments and does not make law, is not an effective vehicle for staging a government takeover.

Thursday, February 24, 2011

Better Pay Your Parking Tickets!

Rep. Roy Schmidt
Sen. Dave Hildenbrand
Legislation has been introduced in the House and the Senate to prohibit the Secretary of State from renewing your driver's license if you have three or more unpaind parking tickets. Pity all those poor college students who didn't get around to paying the fines! Read the bills here: HB 4308 and SB 130. Contact the bill sponsors, Roy Schmidt in the House and Dave Hildenbrand in the Senate to ask questions or register your opinion.

Update on "Get Bloody" Capuano

Boston Globe photo
From US Representative Michael E. Capuano, who decried violent political rhetoric after last month’s fatal shooting rampage in Tucson, said today he regrets urging union workers at a rally in Boston yesterday to “get a little bloody.” The union crowd greeted Capuano's exhortation with cheers, whistles, and applause.
But his remark raised eyebrows elsewhere because Capuano was among the lawmakers who were calling for cooler political rhetoric after his Democratic colleague, Gabrielle Giffords, was shot in the Tucson rampage that killed six other people last month.

At the time, Capuano had said the shooting was probably inevitable because of the nation's increasingly heated political rhetoric. “Many of us were afraid for a long time that something like this would happen, with the level or the tone of the discourse over the last several years," Capuano told WGBH on Jan. 22. "It's gotten violent and personal.”

Wednesday, February 23, 2011

"Sometimes you need to...get a little bloody."

Rep. Michael Capuano, (D) Mass.
So much for toning down the rhetoric. Rep. Michael Capuano (D-Mass.) fired up a group of union members in Boston with a speech urging them to work down in the trenches to fend off limits to workers' rights like those proposed in Wisconsin.

"I’m proud to be here with people who understand that it’s more than just sending an email to get you going," Capuano said, according to theDorchester Reporter. "Every once and awhile you need to get out on the streets and get a little bloody when necessary." Read the full story here.

Why do I keep reporting on the battle in Wisconsin? Because this fight in Wisconsin will eventually lead to similar battles across the country, including Michigan as legislatures and governors deal with severe budget shortfalls.

Should Michigan Tax Private and Public Pension Benefits?

The governor's budget proposal calls for taxing pensions, something Michigan currently does not do. It would raise perhaps $700 million in new tax revenue, but what might be the potential "unintended consequence"? The Mackinac Center, in its recent "Capitol Confidential" opined on that...

"The most unfortunate part of the budget is the proposal to raise taxes on pensions. While the tax fairness and simplicity arguments are not invalid, it’s still a very large tax hike, and one that’s totally unnecessary — those $5.7 billion in potential government employee fringe benefit savings would save several times the estimated $700 million in new revenue from this tax.

State officials must remember that taxpayers are not gentle sheep waiting to be sheared, and many won’t. In effect, the move charges a retiree with a $40,000 annual pension $1,700 a year for choosing to remain in Michigan rather than move to sunny, income tax-free Florida."

President Obama, Meet the President of Brazil

Here is a posting from the Institute for Policy Innovation, whose mission is, "Advocating for lower taxes, fewer regulations, and a smaller, less-intrusive government." I present it as written by IPI Resident Scholar Dr. Merrill Matthews.
Dilma Rousseff

"President Barack Obama is complaining that Republicans want to cut federal spending too much--$61 billion for the rest of this fiscal year.

Meanwhile, the recently elected president of Brazil, Dilma Rousseff, is pushing to cut $30 billion in government spending. Considering the U.S. economy is about $14.6 trillion compared to Brazil’s $2 trillion, $30 billion for Brazil is a much bigger step--equal to about a $210 billion U.S. spending cut. And yet Rousseff presses on.

She even fought against a battle for a higher minimum wage increase--and won. The reason: Minimum wage increases translate into significantly higher government pension costs. And the government just can’t afford it.

And it’s not because Rousseff is a mean-spirited right-winger trying to undermine unions. She was a socialist in her youth; you might even say she was a left-wing community organizer.

Who would have thought that in tough financial times we’d have to encourage the U.S. president to look to the president of Brazil--a former socialist and guerrilla fighter--for the resolve and gumption it takes to cut federal spending?"

Obama Inserts Himself Into the Wisconsin Battle

Don't kid yourself, the President of the United States is personally involved in the state battle over the budget and collective bargaining in Wisconsin. Don't believe it? Just look at the "Organizing for America" Wisconsin site. They have 59 offices in Wisconsin alone. On the Wisconsin site is a very one-sided report on what is going on in Madison and a call for folks to rally at the Capitol to stop Governor Walker and the legislature from doing the people's business. Here is a quote from the website: "Our job as organizers is to take action, and what better way than to help out our friends in the labor community. The vote could happen as soon as tomorrow so we need to act now."

The Congressional Budget Cuts - By the Numbers

Last week, the House Appropriations Committee approved a 302(b) allocation of $420 billion for non-security spending. The FY 2011 continuing appropriations bill being considered this week is below this amount. It specifically provides $396.6 billion for non-security spending (compared to the $378 billion FY 2008 non-security funding level) and $631.9 billion for security spending (compared to the $554 billion FY 2008 security funding level). Overall, this is a $99.6 billion reduction compared to the President’s budget—$81 billion of the reduction is non-security spending, $18.6 billion security spending.

You can see a chart of spending by budget here.

What is unfortunate is that the Republican controlled House could not muster the votes to cut an additional $22 billion from the current year spending package. All the RSC members voted for it, but that was not enough votes. The measure failed,  147-281. Read about the split in GOP ranks here.

Here is the text of the press release sent out by the RSC before the vote:

RSC Members Offer Amendment to Cut More from 2011 Spending Bill
Looking to Make a Good Bill Better
Washington, Feb 18

Today, members of the Republican Study Committee (RSC) will offer an amendment to reduce spending in H.R. 1, the FY 2011 continuing resolution, by an additional $22 billion. The amendment would return total non-security spending in 2011 to just below its pre-stimulus 2008 level, which represents a savings of more than $100 billion from President Obama’s non-security discretionary budget request for this year.

“After years of endless increases, Congress is finally talking about how to reduce spending and get Washington out of the way,” said RSC Chairman Jim Jordan. “In the last four years, federal spending rose by nearly 36% while Americans’ median family income fell by 4.2%. At the same time, the national debt spiked by a staggering $5.4 trillion.

“Families and businesses have had to cut back, and they’re demanding that Washington do the same. This week, Republicans are taking the first step to getting the country’s finances in order. This is already a good bill, but I believe we can make it even better.”

The amendment, which will be formally offered by Rep. Marsha Blackburn, makes across-the-board cuts of 11% to Legislative Branch accounts and 5.5% to all other non-security accounts, excluding aid to Israel.

In addition to Chairman Jordan and Rep. Blackburn, other sponsors of the amendment include Reps. Jeff Flake, Scott Garrett, Mike Pence, John Campbell, Jeff Duncan, Frank Guinta, Tim Huelskamp, Steve Southerland, and Joe Walsh.

Monday, February 21, 2011

What is the Parental Rights Amendment

The Proposed Parental Rights Amendment (PRA) to the U.S. Constitution has three sections:

The liberty of parents to direct the upbringing and education of their children is a fundamental right.

Neither the United States nor any state shall infringe upon this right without demonstrating that its governmental interest as applied to the person is of the highest order and not otherwise served.

No treaty may be adopted nor shall any source of international law be employed to supersede, modify, interpret, or apply to the rights guaranteed by this article.

This amendment has been introduced in the United States Congress in prior years. It will be introduced again in 2011. Additionally, many states, including Michigan, will have resolutions introduced in state legislatures to memorialize Congress to pass the Parental Rights Amendment. You can read all about the movement and why this amendment is needed to protect the fundamental rights of parents here.

Stay tuned for further news and developments.

More Budget Information

I was present at his presentation to the Kalamazoo Rotary luncheon Monday, February 21, as Governor Rick Snyder discussed his budget philosophy. I was struck by the fact that this man is no politician. He is a plain-spoken businessman who wants to run government like a business. We heard no platitudes or cheap promises. He was very straightforward. One of his main points was that we "have run the state credit card up to $47 billion and we aren't even making the minimum payments."

His FY 2012 executive legal budget and FY 2013 projected budget are designed to “bring state spending into line without any one-time funding fixes and create a tax system that is simple, fair and efficient for both businesses and citizens." The proposed $45.9 billion budget eliminates the projected $1.4 billion general fund gap in FY 2012, with $1.5 billion in spending reductions and structural reforms.

The administration said even with the spending cuts, the budget provides a safety net for those in need and preserves core, essential services as well as offering a carrot and stick approach in some areas of budget reductions.

Budget highlights include:
Tax Reform:
·         Replace the Michigan Business Tax (MBT) with a flat rate 6 percent Corporate Income Tax with “C” corporations subject to the tax and other businesses not classified as “C” corporations exempted resulting in tax relief for those corporations. Several thousand companies would pay not business taxes.
·         All credits and deductions related to individual income tax, with the exception of personal exemptions, exemptions for the disabled and special provisions for military personnel and veterans are eliminated. The Homestead Property Tax will be retained but phased out at a lower range.
·         Public and private pension income will be taxed but Social Security will not. Michigan is one of only a handful of states that do not tax pensions.
·         Eliminates business credits for films, Brownfield development, the Michigan Economic Growth Authority (MEGA), Next Energy, advanced battery, but would set aside $25 million for film credits and $25 million for business retention augmenting the $75 million in the 21st Century Jobs Fund.
·         A previously scheduled reduction in the state income tax from 4.35 to 4.25 will take place, but stay there rather than continue to decline to the previously scheduled 3.9 percent.
·         Create a new State Education Funding Act (“P-20”) incorporating the School Aid Fund as well as available General Fund dollars to support education efforts from early childhood to higher education.
·         Cut the K-12 foundation allowance by a substantial $470 per pupil.
·         Cut Intermediate School District (ISD) operation budgets 5 percent.
·         Fund community colleges at FY 2011 levels.
·         Cut state universities 15 percent but set aside $83 million to reward universities that hold tuition and fee increases below the historical five-year annual average.
·         Roll funding for universities and community colleges from the General Fund to the School Aid Fund, the main funding source for K-12 schools.
Revenue Sharing:
·         Increase constitutional revenue sharing payments to cities, villages and townships by 4 percent but eliminate the statutory revenue sharing payments.
·         Allocate $200 million for an incentive-based revenue sharing program for cities, villages and townships that meet specific standards and adopt best practices. Details to be released in March.
Health Care and Human Services:
·         Phase out the current 6 percent tax on health maintenance organizations while broadening and reducing the tax rate to 1 percent and to all insurance claims.
·         Cut the Department of Community Health (DCS) budget $41.5 million resulting in reduced graduate medical education (GME) payments and other department programs. Further savings will be realized from behavioral health medications being added to the preferred drug list.
·         Set a lifetime limit of 48 months for residents receiving welfare payments but exempting for incapacity and hardship.
·         Reduce hourly rates paid to unlicensed aides and relatives in the child day care program.
·         Cut 300 field worker positions and before-and-after school program employees from the Department of Human Services (DHS).
Other spending reductions:
·         Reduction of 15 percent in payment in lieu of taxes (PILT) and fire protection grants to municipalities.
·         Cut state aid to libraries by $2.3 million in the General Fund, but direct $950,000 to the Michigan e-Library.
·         Recommend privatizing food service and prison store operations in Michigan prisons.
·         Close one as yet unnamed prison later this year.
·         Eliminate six trial court judgeships.
·         State employee concessions totaling $180 million.
·         Turn over the dairy farm inspection program to industry field representatives certified by the Department of Agriculture.
Gov. Snyder, who presented the two “omnibus” Executive Budget bills for legislative introduction, called on lawmakers to pass the budget by May 31. One bill includes all departmental operations. The second bill is comprehensive to education. Snyder will, in special messages to the Legislature, release details of additional government reforms in March and education reforms in April. The budget recommendations can be viewed at:

Saturday, February 19, 2011

The 2011-2012 Budget By the Numbers

Here is a snapshot of total spending by area, including federal sources, in Governor Snyder's proposed budget. This proposal now goes to the Appropriations Committees of both houses for approval. They will make changes, but ultimately, their final numbers have to be in agreement before a budget can be passed into law. The budget year starts October 1, 2011. Over the past several years, the budget process has not been completed until, or AFTER October 1st. Snyder and the current legislature are committed to getting it done by June 1st.

Spending AreaTotal Expenditures
Agriculture$71.50 -6.50%
Attorney General$74.30 1.30%
Civil Rights$12.10 -5.30%
Community Colleges$295.90 0%
Community Health$13,965.30 -1.10%
Corrections$2,012.40 0.20%
Education$113.94 -10.30%
DELEG$1,272.10 -0.40%
Environmental Quality$405.80 2.60%
Executive Office$4.40 -5%
Higher Education$1,362.30 13.70%
Human Services$6,891.50 -0.80%
Judiciary$260.30 0%
Legislature$116.00 -1.20%
Military/Veterans$152.40 1.60%
Natural Resources$330.20 2.10%
School Aid$12,173.50 -7.30%
State$211.90 -0.80%
State Police$521.50 -2.10%
Tech, Mgmt, Budget$1,012.10 3.90%
Transportation$3,377.80 4.40%
Treasury$1,969.90 1.70%
Totals$46,627.20 -2.50%

More on Wisconsin and the Collective Bargaining Issue

From NRO. Walker as Hitler
I was scolded, as you can read in the comments in previous blogs, for not mentioning that the legislation being enacted in Wisconsin included "elimination of collective bargaining rights for public employees." Interesting that the "anonymous" commenter is accusing me of telling a partial truth, when he, himself is not being totally truthful and is unwilling to reveal his identity.

No question, collective bargaining will be greatly curtailed, but not eliminated. I also did not mention that if this legislation is not passed, Governor Walker, who MUST balance the budget, said that he would be forced to lay off thousands of government employees instead.

Here is a factual summary of what Walker and the legislature is doing:

"Governor Walker is facing a $3.6 billion budget deficit, and he wants state workers to pay one-half of their pension costs and 12.6 percent of their health benefits. Currently, most state employees pay nothing for their pensions and virtually nothing for their health insurance.

Nationwide, state and local government unions have a 45 percent total-compensation advantage over their private-sector counterpart. With high-pay compensation and virtually no benefits co-pay, the...unions are bankrupting America — which by some estimates is suffering from $3 trillion in unfunded liabilities.

Exempting police, fire, and state troopers, Governor Walker would end collective bargaining over pensions and benefits for the rest. Collective bargaining for wages would still be permitted, but there would be no wage hikes above the CPI. Unions could still represent workers, but they could not force employees to pay dues. In exchange for this, Walker promises no furloughs for layoffs."

Read more here from the above article in NRO.

And by the way, I publish all comments that are not profane or totally off point.

Friday, February 18, 2011

Illinois Tea Party Member Finds Two Wisconsin Senators Hiding in Illinois

The Democrats in the Wisconsin Senate don't want to vote on the Public Employee collective bargaining bill. So, they all left the state. The Police were out looking for them, but it was a tea party member who found two of them. Watch here.

Thursday, February 17, 2011

Just Received this Urgent E-mail From a Staffer in the Wisconsin Capitol

From The Journal Sentinel Online

Watch students picketing, for what reason, they do not know.

Wisconsin's Governor Walker: Courageous. Right-to-Work is Born in the Badger State

Led by newly elected governor Scott Walker, the GOP majorities in the State Assembly and State Senate are poised to pass legislation that have these elements:
  • Public workers would pay half the costs of their pensions
  • Public workers would pay 12.6 percent of their health care coverage
  • State employees' share of pension and health care costs would go up by an average of 8 percent.
  • From RoadRunner blog
  • Unions still could represent workers, but could not seek pay increases above those pegged to the Consumer Price Index unless approved by a public referendum
  •  Unions also could not force employees to pay dues and would have to hold annual votes to stay organized. (Right-to-Work)
For this, the Wisconsin Education Union has called on teachers to come to the Capitol to protest, which has forced the closing of dozens of schools. Paid protesters are calling the governor a "dictator". Meanwhile, the President of the United States has characterized the governor's actions as an "assault" on unions. So much for using civil language.

Read the story here.

Wednesday, February 16, 2011

Call Congress. Tell Them to Go All the Way to $100 Billion in Cuts

Today, the House of Representatives is considering an amendment offered by Rep. Jim Jordan to cut an additional $20 billion in spending, which would achieve the full $100 billion in non-security cuts in the first year that Republicans promised in their Pledge to America.
Heritage Action has been urging Republicans in the House to fulfill their promise, and as a result of your emails, conservatives have made progress—Republicans increased their proposed non-security cuts from $58 billion to $81 billion. The Jordan amendment will get them all the way there (learn more about the Jordan amendment).
Please call your Congressman and urge them to vote for the Jordan amendment. With your immediate help, we can pass this important amendment.
Thanks in advance for doing your part to hold Congress accountable.

A Discussion on the 5th Article of the US Constitution

Article 5 - Amendment
"The Congress, whenever two thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as part of this Constitution, when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress..."

I recently sent out a letter regarding the National Debt Relief Amdendment. In my letter, I referenced an article in the "Budget and Tax News" which included this passage. "Perhaps the most controversial aspect of the NDRA movement is the effort to get it proposed through an amendments convention under Article V of the United States Constitution. This amendment method requires an application to Congress of two-thirds of the states for Congress to call a convention for proposing Amendments to the constitution. Any amendments proposed by the convention would then have to be approved by three quarters, or 38, of the states.

Some worry a convention might “run away.” They cite the convention that was called to amend the Articles of Confederation, which went on to write the current Constitution, effectively ignoring the Articles in the process.

North Dakota State Senator Curtis Olafson (R-Edinburg), a strong supporter of the NDRA, said he believes state legislators would appoint reasonable people with strong public backgrounds. “But suppose the bizarre happens,” he said of the runaway scenario. “Their actions would still have to be ratified by 38 states.”

Some have interpreted this to mean I support some type of constitutional convention. For the record, I do not support a con/con nor a "runaway convention" and do not see that as likely. But I do support the states stepping in and making the US Congress do what they do not seem to have the intenstinal fortitude to do themselves:
Stop the Spending!

Teachers in Comstock School District Average Compensation Package = $70,000

From Capitol Confidential:
Under the Comstock Public Schools teachers’ union contract, the average teacher salary was $53,756 in 2009. In addition, the district provides health benefits costing $16,452 for the most commonly selected plan, which is 59 percent more costly than insurance provided to the average private sector worker in Michigan. Teachers contribute 5 percent toward their coverage, compared to a 20 percent average contribution required from private sector workers in Michigan.

Based on the current
state-run teacher pension system, a Comstock teacher retiring after 30 years will get a $27,639 annual pension (based on the final “step” on the salary schedule), which they can begin collecting from their early 50s on. This amount increases by 3 percent each year. Retired teachers also get subsidized health insurance.

Comstock schools collected
$11,751 per student in property tax levies, state and federal grants in 2008-2009, of which around 70 percent was paid out to employees covered by the union contract described here. Read the full story here.

Tuesday, February 15, 2011

This, You Call Austerity?

Today, in his press conference, President Obama said government "has to live within its means." The budget he just proposed adds $1.67 Trillion to the national debt, over $300 billion more than last year.

This, he calls "living within our means":
  • In 2007, the Department of Transportation had one employee who made over $170,000 per year. By the end of 2009 that number had grown to over 1,690. The new budget proposal for the coming year projects an increase in the DOT budget of 68% to over $168 billion. It includes over $53 billion for "high-speed rail."
  • $500 million to restructure the new Bureau of Ocean Energy Management, Regulation and Enforcement, which was formed after the April spill in the Gulf of Mexico. This is a brand new bureaucratic regulatory agency.
  • A 14% increase in the Department of Commerce which includes the National Institute of Standards and Technology laboratories, which have helped develop image processing, smoke detectors and pollution-control technology, would receive $764 million under the plan, an increase of more than $100 million.
  • A 38.5% increase in the Department of Education, which includes "$4.3 billion to improve teacher quality."
Read many more details about this "austere" budget here.

MSU Survey: Confidence in Economy Improves, Confidence in Obama Plummets

The Michigan State University Institute for Public Policy and Social Research has just released its quarterly survey on consumer confidence. Here are some of the highlights and "lowlights" from the survey of 1,000 adults statewide, Detroit numbers in parenthesis:
  • 24.7% said their financial situation has improved
  • 43.1% said they are worse off than one year ago
  • 57.1% believe they will be better off in a year
  • 32.7% rate Obama's performance good or excellent (79.5%)
  • 18% approved of Granholm, an all-time low (34.6%)
  • 29.8% call themselves Democrats
  • 20.4% call themselves Republicans
You can read the entire report here.

Monday, February 14, 2011

President's Budget: Enormous. They Want to Run Everything!

The document below came to me last night. It is from the White House. It claims to be fiscally responsible. But, as you will see, it includes all kinds of new government programs that should be created by the private sector and it balloons the deficit next year by an additional $300 billion to over $1.6 TRILLION.  I present it to you without further comment, Enjoy reading it. 

Having emerged from the worst recession in generations, the President has put forward a plan to rebuild our economy and win the future by out-innovating, out-educating, and out-building our global competitors and creating the jobs and industries of tomorrow. But we cannot rebuild our economy and win the future if we pass on a mountain of debt to our children and grandchildren. We must restore fiscal responsibility, and reform our government to make it more effective, efficient, and open to the American people.

The President's 2012 Budget is a responsible approach that puts the nation on a path to live within our means so we can invest in our future - by cutting wasteful spending and making tough choices on some things we cannot afford, while keeping the investments we need to grow the economy and create jobs. It targets scarce federal resources to the areas critical to winning the future: education, innovation, clean energy, and infrastructure. And it proposes to reform how Washington does business, putting more federal funding up for competition, cutting waste, and reorganizing government so that it better serves the American people.

Key Budget Facts
• The Budget includes more than $1 trillion in deficit reduction - two-thirds of it from cuts – and puts the nation on a path toward fiscal sustainability so that by the middle of the decade, the government will be paying for what it spends and debt will no longer be increasing as a share of the economy.
• The President meets his pledge to cut the deficit he inherited in half by the end of his first term.
• Five-year non-security discretionary spending freeze will reduce the deficit by over $400 billion over the next decade and bring this spending to the lowest level since President Eisenhower sat in the Oval Office.
• 10-year Deficit Reduction: $1.1 trillion, excluding war savings and not extending 2001 and 2003 tax cuts for high-income earners. Two-thirds are from spending cuts.
2011 Projected Deficit: $1.645 trillion, 10.9 percent of GDP; 2012 Projected Deficit: $1.101 trillion,
7.0 percent of GDP; 2015 Projected Deficit: $607 billion, 3.2 percent of GDP; 2017 Projected Deficit:
$627 billion, 3.0 percent of GDP
• $148 billion for R&D overall; robust investment in biomedical research at NIH ($32 billion, a $740 million increase over 2010 enacted level, post-transfers); more than doubles energy efficiency research, development, and deployment funds; and continues our efforts to double investments in key basic research.
• Supports the goals of: putting one million electric vehicles on the road by 2015; doubling share of electricity from clean energy sources by 2035; and reducing buildings' energy use by 20 percent by 2020.
     o Elimination of 12 tax breaks to oil, gas, and coal companies will raise $46 billion over 10 years to help pay for programs to reach these goals.
• Simplifies, expands, and makes permanent R&D tax credit.
• Establishes 20 new Economic Growth Zones, hard-hit areas that will receive expanded tax incentives to spur investment and employment
• Maintains maximum Pell Grant award, helping 9 million students afford college.
     o Paid for with more than $100 billion in savings, including eliminating year-round Pell and graduate student in-school loan subsidy.
• Reforms K-12 school funding by supporting high standards, encouraging innovation, and rewarding success.
     o Consolidates 38 K-12 programs into 11 that emphasize competition and evidence of what works, while also eliminating 13 education programs outright.
• Expands the Race to the Top concept to early childhood education, school districts, university funding, and job training.
• Prepares 100,000 new science, technology, engineering, and math teachers.
• As part of a $556 billion comprehensive surface transportation bill, the Budget creates hundreds of thousands of jobs in the short term with a $50 billion up-front investment; establishes a National Infrastructure Bank to support projects of national importance; and brings access to high-speed rail to 80 percent of Americans within 25 years.
     o Consolidates 60 duplicative, often earmarked programs into five. Investment will only be made if bipartisan financing is found to ensure that it does not increase the deficit.
• Builds a next-generation, wireless broadband network to bring high-speed Internet access to 98 percent of Americans, and establish an interoperable network for public safety.
     o Plan is fully paid for, and the sale of spectrum provides nearly $10 billion for deficit reduction. '
• A five-year non-security discretionary spending freeze that will reduce the deficit by over $400 billion over the next decade and bring this spending to the lowest level since President Eisenhower sat in the Oval Office.
• More than 200 terminations, reductions, and savings totaling more than $33 billion in savings for this year alone. Half of all agencies see their top line reduced from 2010 enacted levels.
• Sample cuts: Community Development Block Grants by $300 million; UHEAP in half or by $2.5 billion, Great Lakes Restoration Initiative by one-quarter or $125 million; more than $1 billion in grants to large airports; $950 million to states' revolving funds for water treatment plants and other infrastructure.
• Cuts $78 billion from the Pentagon's spending plan over the next five years, bringing defense spending down to zero real growth. Including spending related to Iraq and Afghanistan, overall defense spending for 2012 is more than 5 percent below the 2011 request.
• Pays for the first two-years of "doc fix" -- which will prevent a nearly 30 percent cut in reimbursements to doctors in Medicare and keep them seeing patients - with $62 billion in new, specific health care savings, including recommendations from the Fiscal Commission and recent bipartisan proposals, that will strengthen program integrity and increase efficiency and accountability.
• Pays for a three-year patch to prevent an increase in taxes on middle-class families through the Alternative Minimum Tax (AMT) by limiting the rate at which high-income earners can itemize tax deductions. This would bring the rate back to where it was during the Reagan Administration.
• The President has called on Congress to work with the Administration on corporate tax reform that will simplify the system, eliminate special interest loopholes, level the playing field, and lower the corporate tax rate for the first time in 25 years - without adding a dime to the deficit.
• The President lays out his principles to strengthen Social Security and has called on Congress to work on a bipartisan fashion to keep this compact with future generations.
• Includes important Fiscal Commission recommendations such as: federal civilian worker pay freeze, medical malpractice reform, PBGC reform, and a government reorganization initiative.
• Cuts more than $2 billion in administrative overhead like travel, printing, supplies, and advisory contract services.
• Embraces competitive grant programs based on the "Race to the Top" model applying it to programs from early childhood education through college; to allocate grants for transportation; to bring innovation to workforce training; and to encourage both commercial building efficiency and electric vehicle deployment.
• Sets up a process to quickly dispose of excess and under-utilized federal real estate.
• Starts a process to reorganize government so it is better able to serve the goal of a competitive America.
• Encourages new "pay for success" bonds in areas where government programs have too often failed. Taxpayers will only pay the programs if they produce results.