Paul Ryan's 2013 Budget Slammed By Democrats! Path To Prosperity Or Poverty? Gov't Dependency Or Entrepreneurship?

Durbin slams Paul Ryan budget plan

The number two Democrat in the Senate said Wednesday that Rep. Paul Ryan's budget proposal is "not a balanced approach" and would unfairly hurt senior citizens with it dramatic changes to Medicare.

"His budget refuses to imposes any new taxes on the wealthiest people in America. In fact, it cuts their taxes even more," Illinois Sen. Dick Durbin said in an interview with "CBS This Morning."

"And to achieve it, it makes dramatic cuts in Medicare, in Medicaid and in programs that people count on for the basic safety net in America. It is not a balanced approach. Unfortunately it reflects where his party is today," Durbin said.

Ryan on Tuesday unveiled his his 2013 budget proposal, which includes an overhaul of the tax code that would leave just two individual tax brackets: 10 percent and 25 percent as well as revision of a proposal from a year ago to dramatically overhaul Medicare.

Ryan's plan is unlikely to become law, but is intended to provide a simple message for Republicans in an election year.

"Paul Ryan wants to privatize Medicare. At the end of the day, those seniors who are not healthy and can't buy health insurance today will find it almost impossible to do so under Paul Ryan's plan," Durbin said.





GOP budget sets up competing visions for 2012 candidates

House Republican Rep. Paul Ryan's proposed 2013 budget has essentially no chance of becoming law, but that doesn't mean it doesn't serve a purpose: The proposed budget draws a clear dividing line between Democrats and Republicans ahead of this year's presidential election.

Upon unveiling his budget today, Ryan said he "absolutely" expects the eventual presidential nominee from his party to get behind his budget proposal, despite its potential political landmines, most notable his proposed changes to Medicare.

In addition to adding a private insurance option for seniors using Medicare, Ryan's budget also overhauls the tax code and would create just two income tax brackets, 25 percent and 10 percent. Ryan said today his budget would balance the budget by 2040, putting the nation on the track to prosperity.

"We are sharpening the contrast between the path that we are proposing and the path to debt and decline that the president has placed us upon," Ryan said today. "And, yes, we do believe that our nominee, whoever this person is going to be, is gonna be perfectly consistent with this."

"I've spoken to all these guys," he added. "And they believe that we are heading in the right direction."

Republican presidential candidate Mitt Romney told CBS News he applauds Ryan and his House colleagues "for taking a bold step toward putting our nation back on the track to fiscal sanity and robust economic growth." The plan, he said, will "strengthen Medicare for generations to come" and shares Romney's goals of cutting taxes, reforming the tax code, reducing spending and tackling the debt.

Newt Gingrich called the Ryan budget "a courageous plan that correctly understands the key to returning to a balanced budget is robust economic growth, spending control and bold entitlement reform." He said his plan to grow the economy and balance the budget "differs in details but shares the same core principles."

At least one Republican presidential candidate, however -- libertarian Rep. Ron Paul -- says Ryan's budget doesn't actually go far enough. Paul, whose budget plan would make $1 trillion in cuts in one year, said in a statement that Ryan's plan is "essentially playing the same game the Washington establishment has played for years with our hard-earned money."

While it may seem like politics-as-usual to Paul, Democrats are already casting Ryan's budget as too extreme. The congressman's 2013 plan is sure to face the same fate as his 2012 budget: It was approved by the GOP-led House but was flatly dismissed by the Democratic-led Senate and President Obama. Democrats seized on the proposals in the budget to accuse Republicans ending Medicare. In a presidential election year, the criticism is almost certain to be louder.

The White House today blasted Ryan's plan, in part because they said its tax breaks "would be paid for by undermining Medicare and the very things we need to grow our economy and the middle class - things like education, basic research, and new sources of energy."

But rather than shy away from those fights, Ryan has made clear in the past week that Republicans are ready to embrace them. The budget chairman released two campaign-like videos in the days before releasing his budget, telling Americans they have a choice to make about the nation's future.

"Will it be a future that looks like the America we know?" Ryan says in a video released Monday, over ominous music. "One of greater opportunity, greater prosperity, or more of what we're seeing today: debt, doubt and decline."

While he may not win over the full Congress with his plan, Ryan at least wants to make his case to the voters and perhaps give his party a boost in November. Sen. Jeff Sessions, R-Ala., the top Republican on the Senate Budget Committee, was at Ryan's side today to praise his plan and promise similar plans if Republicans win back the Senate this year. He excoriated Senate Democrats for failing to put forward their own budget.
"The Senate's Democratic majority has forfeited their claim to leadership for America," Sessions said. "If the voters give the Republicans in the Senate the honor of having the majority and the leadership, we will work with the House to pass a congressional budget. It will be an honest budget. It will change the debt course of America."

Mr. Obama has similarly put forward proposals this year he aims to make part of his re-election pitch, even though they were dead-on-arrival in Congress. Facing the prospect of more GOP resistance this year, the president's re-election team released their own 17-minute video -- albeit with a lot more theatrics, complete with narration by Tom Hanks -- touting the president's accomplishments.


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Paul Ryan Unveils Risky 2013 GOP Budget; Medicare Targeted, Major Revisions To U.S. Tax Code.

Congressman Paul Ryan's Risky 2013 Budget Blueprint Targets Medicare, Medicaid, Welfare Reform, Social Security, the U.S. Tax Code & Defunds Pres. Obama's Health Care Law i.e., Repeals it.





House G.O.P. Lays Down Marker With New Budget Plan

House Republicans, believing that worries over the deficit will trump affection for Medicare and other popular programs, unveiled a federal budget blueprint Tuesday morning that would cut deeply into domestic spending, transform the tax code and balance the budget by 2040.

Because tax revenues would remain unchanged, the deficit under the plan would be almost as deep as the red ink under President Obama’s feet in the fiscal year that begins in October. But by mid-decade it would drop precipitously, and over decades, significant changes to Medicaid and Medicare, the federal health care plans for the poor and the elderly, would help bring the budget into balance.

“We are here to offer Americans the chance to choose which future they want,” Representative Paul D. Ryan of Wisconsin, the chairman of the House Budget Committee, said, positing a choice between “a path to renew prosperity” and “the president’s path of debt and decline.”

Ultimately, the House budget is a political document, since the Senate has no intention of passing a budget of its own.

The plan amounts to a political bet, with high stakes wagered by both parties.

“This isn’t just matter of the House battling with the Senate or arm-wrestling with the president,” said J. D. Foster, a fiscal policy expert at the conservative Heritage Foundation. “For better or for worse, what they produce is going to be the standard for conservatives and Republicans going into this election season.”

Republicans believe voters will reward them for what one what member of the House Budget Committee, Jason Chaffetz of Utah, called a “bold and realistic” effort to transform and shrink government. Democrats are equally certain that because the plan fundamentally changes Medicare without raising taxes on the rich, they can pummel vulnerable Republicans.

On Monday, the Democratic Congressional Campaign Committee began a “Millionaires over Medicare” campaign against 41 House Republicans who Democratic officials believe are vulnerable to the line of attack. “Under the leadership of Budget Committee Chairman Paul Ryan and Speaker John Boehner, House Republicans are again proposing a budget that ends the Medicare guarantee while protecting millionaires,” a memo from the group said. “It’s not only bad politics, it’s very bad policy.”

The budget plan embraces a Medicare plan similar to the one put forward by Mr. Ryan and Senator Ron Wyden, Democrat of Oregon, which would change the health plan from a guaranteed, fee-for-service government insurance program to a menu of private insurance plans subsidized by the government. Older Americans would be able to buy into the existing fee-for-service program, although annual expenditures would be capped.

The other flashpoint will be total spending on programs under Congress’s annual discretion. The budget will cap that spending at $1.028 trillion, the same level set by last year’s budget but $19 billion below the cap set in July after protracted negotiations to raise the nation’s statutory borrowing limit.

Democrats argue that the level in the new budget amounts to a broken promise that will lead to more strife as the House and Senate forge 12 spending bills this summer that will add up to two different totals. The House will aim for the $1.028 trillion cap in the new House budget while the Senate will aim for $1.047 trillion, the summer Budget Control Act cap.

“Ignoring the B.C.A. represents a breach of faith that will make it more difficult to negotiate future agreements,” two senior Democratic senators said Monday in a letter to Mr. Boehner and Representative Eric Cantor of Virginia, the House majority leader.

“Rather than trying to tear down the B.C.A., we should be holding it up as an example of what can be accomplished if we are willing to set aside our differences and work hard to find bipartisan solutions to our nation’s challenges,” said the letter from Kent Conrad of North Dakota, chairman of the Senate Budget Committee, and Daniel K. Inouye of Hawaii, chairman of the Senate Appropriations Committee.

House Republicans argue that additional cuts to both discretionary and entitlement spending are needed now to head off an automatic $110 billion in across-the-board cuts to defense and domestic programs in 2013. Even with the lower total, the House would still be above the $950 billion that domestic programs would reach if the across-the-board cuts take effect.

Under the House plan, the current $1.18 trillion deficit would fall to $797 billion in the coming fiscal year, compared with $977 billion under Mr. Obama’s plan. By 2016, the deficit would fall to $241 billion by Republican estimates. The Congressional Budget Office estimated last week that Mr. Obama’s budget would still have a $529 billion deficit in 2016.

The Ryan plan would accumulate $3.1 trillion in additional debt through 2022. The president’s would add $6.4 trillion, more than twice that total. The Republican budget cuts spending by $5 trillion more than the president’s plan, mandates the repeal of Mr. Obama’s health care law and assumes the elimination of the government-backed mortgage giants Fannie Mae and Freddie Mac.

The tax code would be simplified to just two tax rates, 10 percent and 25 percent, with the closure of tax credits and deductions. The 35 percent corporate income tax would be lowered to 25 percent and the existing, worldwide system of taxing corporate profits would be changed to a territorial system in which only domestic profits were subject to United States corporate taxation. But the budget assumes revenues would stay consistent with revenues under the current individual and corporate tax codes.

Medicare would be turned into something like Mr. Obama’s health care plan for the uninsured, a subsidized set of private insurance plans, while Medicaid would be converted to fixed block grants to the states.

Bipartisan talks continue over a so-called grand bargain on deficit reduction that would combine tax increases, spending cuts and changes to entitlement programs such as Medicare and Social Security. But hopes are dimming as both parties frame the election around their vision of deficit reduction.

“The idea of a grand bargain in 2012 is very hard to find credible,” Mr. Foster said. “To a large extent this election is about deciding what the grand bargain is supposed to look like.”


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Why Obama's Debt Panel Proposal Failed: Jobs More Important

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The Message From Washington: Recovery Fix Is More Urgent Than Deficit Fix


Friday, the 18 members of the National Commission on Fiscal Responsibility and Reform failed to pass an austerity plan to slash the U.S. budget deficit by 2015. Although eleven members voted in favor, the final tally was three short of the necessary number to send the plan to Congress for a vote.

Meanwhile, the Labor Department reported that unemployment in November had jumped to 9.8%, causing members of Congress and the Obama administration to suggest what needs to be done quickly to fix the jobs situation.

From Democrats: Extend unemployment insurance for those who have lost their jobs and continue tax cuts for 98% of Americans.



From Republicans: Extend tax cuts for everybody.

The takeaway? Fixing the sluggish recovery is more important right now than fixing the country’s deficit problem.

The cumulative U.S. budget deficit over the next 10 years is projected to be about $6 billion, and the total of U.S. debt is expected to equal more than two-thirds of total U.S. economic output in 2020.

That’s assuming that policymakers allow the Bush-era tax cuts and other expiring tax measures to end as scheduled (which almost certainly won’t happen). Despite the immediate focus on the recovery, don’t be surprised if some of the ideas for austerity find their way back into the president’s FY2012 budget request in February.

As Sen. Kent Conrad, D-N.D., said during the Fiscal Commission’s final meeting Friday: “This is not the end of the story.”

Visit msnbc.com for breaking news, world news, and news about the economy

Debt Plan Failed To Pass Despite Majority Support: Jobs More Important


A majority of the White House debt-reduction panel, representing a cross-section of the political spectrum, backed a sweeping yet controversial overhaul of U.S. tax and spending policies Friday, a sign that both parties are ready to put sacrosanct programs on the table to address the budget deficit.

Eleven members, ranging from liberal Democratic Sen. Richard Durbin of Illinois to conservative Republican Sen. Mike Crapo of Idaho, supported a proposal advanced by Democrat Erskine Bowles and Republican Alan Simpson, co-chairmen of the National Commission on Fiscal Responsibility and Reform.

The support surprised many but still fell short of the 14 votes needed to bring the package to the House and Senate floor for a vote. White House and Republican leaders suggested key parts of the package could be folded into the budget next year.

The proposals include eliminating popular tax breaks, cutting defense spending and raising the retirement age for Social Security. Multiple members of the panel said such steps were necessary to prevent the U.S. from entering a Europe-style fiscal crisis in the next decade.

President Barack Obama welcomed the report, without endorsing any of its specifics. "To sustain growth in the medium and long term we need to face some difficult choices to curb runaway debt," Mr. Obama said in a statement. "It will require cutting the spending we don't need in order to invest in what's necessary to grow our economy and our middle class. It will require all of us, Democrats and Republicans, to find common ground."

Government officials are trying to establish credibility on long-term deficit reduction while at the same time giving the struggling economy a shot in the arm, which would likely increase the deficit in the short term.

To White House policy makers and their allies, there is no contradiction between demands for immediate stimulus and efforts to cut the deficit over the coming decade.

In fact, the Labor Department's report Friday of far lower job creation than expected in November could help the process. Lawmakers and officials believe it will hasten a deal on a short-term extension of tax cuts, based on the idea that taxes shouldn't rise during an economic downturn, and moving the deficit conversation to the long term.

The White House and congressional negotiators were in talks on a costly package that is expected to temporarily extend all of President George W. Bush's tax cuts, as well as unemployment benefits and a raft of tax breaks for lower-income Americans that were part of last year's economic-stimulus law.

"There is no reason why policy makers can't do the sensible thing of stimulating the economy today through policies such as [emergency unemployment compensation] extension and some type of payroll-tax holiday and simultaneously improve our long-term fiscal sustainability," said Alan Krueger, a Princeton University economist who recently resigned as assistant Treasury secretary for economic policy.

Mr. Obama said the commission's report "includes a number of specific proposals that I—along with my economic team—will study closely in the coming weeks as we develop our budget and our priorities for the coming year."

White House budget director Jacob Lew invited the commission to meet with him and Treasury Secretary Timothy Geithner.

Administration officials have pointed to the commission's proposed cuts to defense spending, its attack on "tax expenditures"—cherished tax breaks such as mortgage-interest deductions—and its call for an overhaul of Social Security as potential areas to pursue.

The jobs report—just 39,000 new payroll jobs and a 9.8% unemployment rate for November—was "shockingly bad," said Douglas Holtz-Eakin, a former Republican director of the Congressional Budget Office. But the 11 votes for the commission report, including five senators from across the political spectrum, was "shockingly good," he said.

A resolution of the tax issue and the surge in support for drastic steps to reduce the deficit could bring economic benefits, Mr. Holtz-Eakin said. "We've got a business sector staring at Washington, totally paralyzed by what they see coming out," he said.

After the commission's final meeting, an additional 13 senators—12 Democrats, and independent Joseph Lieberman of Connecticut—wrote to the president urging action on the commission's plan "now."

"I would simply say to the president, to the Senate, to the House, and to the people of our nation, that we should not let this proposal fall idly by the wayside," Republican Sen. Mike Crapo, a conservative closely aligned with the GOP leadership, said as he cast his vote for the plan.


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Thom Tillis To Cut Unnecessary N.C. Schools Budget Policy Strings: Educational Freedom

New North Carolina House Speaker To Cut Educational Policy Strings: Educational Freedom


Local schools facing big budget cuts can expect more freedom on how to spend state money, says Rep. Thom Tillis, a Huntersville Republican who's been tapped as House speaker in the new GOP-dominated legislature.

Before he was elected to the North Carolina State Legislature four years ago, Tillis was a Charlotte-Mecklenburg Schools parent volunteer, PTSA president and education activist from the northern suburbs.

Now he brings that experience to a top post in a year that could shake the foundations of public education, with Republicans holding a majority in the state legislature for the first time in more than a century and a $3 Billion gap looming in the N.C. State budget.

Tillis says his PTSA work at Hopewell High gave him a firsthand view of how many strings come attached to state money. While he's not ready to offer specifics, he says Republicans are ready to loosen those strings.

"There's about 500 pages of statutes," Tillis said. "How can we ease the burden?"

That's welcome news to CMS leaders, who have long sought more decision-making power.

Board chair Eric Davis, who is registered unaffiliated, says much of the current control dates to the Great Depression, when North Carolina stepped in as small districts went broke.

"We're now in an economic crisis second only to the Great Depression," Davis said, and he urges state legislators to seize the opportunity to get rid of "rules and regulations that tie our hands."

The CMS board is still working on a legislative wish list, but Davis cited rules restricting furloughs and setting the school calendar as examples that limit local options.

Superintendent Peter Gorman said Wednesday that he'd like to see the state give each district its share of the money with no restrictions. Now, state money is often attached to prescribed jobs. Preliminary state plans for dealing with big cuts in 2011 would reduce the number of teachers available at each grade level, a loss of up to 500 from CMS alone, and eliminate teacher assistants in grades 1-3, leaving them only in kindergarten.

Gorman said he'd like the option of cutting something else to preserve assistants. Making those decisions brings more criticism to local officials, he said, but "I'd rather take the blame and be more strategic."

Tillis says his party has some broad strokes plans for education, from allowing more charter schools to cutting regulations. Starting this month, he said, he and other leaders will meet with educators, officials, parents and others willing to help chart the details.

"We want as many people engaged in the process as are interested," he said shortly after Republicans chose him to become speaker.

Up-close knowledge

Mary McCray, president of the Charlotte-Mecklenburg Association of Educators, calls Tillis' CMS experience "a plus-plus."

"He knows what overcrowded high schools are, what they look like," McCray said.

In 2003, Tillis was part of FUME, a north-suburban parent group organized by Rhonda Lennon, who's now on the CMS board. The group was concerned about school crowding created by CMS student assignment and slow construction of suburban schools, along with other issues.

At Hopewell, Tillis said, concerns about safety and discipline led to a PTA survey of teachers. That taught him to listen to rank-and-file educators, he said.

He said he'll work with groups such as the N.C. Association of Educators, a quasi-union in a right-to-work state, but "I don't view the NCAE as being the voice of teachers."

Tillis says his own family has experienced school choice; his two kids attended both public and private schools. His daughter graduated from CMS's Hopewell and attends Central Piedmont Community College, he said, while his son graduated from the private Cannon School and attends American University in Washington, D.C.

One of the GOP's top priorities is lifting North Carolina's 100-school limit on charters, which get public money but don't report to local districts.

"I believe this year if you see nothing else, you will see a more friendly environment for charter schools in North Carolina," he said.

Not all charters are successful, Tillis said, but a wider range would offer more options and more success stories. His goal, he says, is recognizing standouts among charters and traditional public schools.

Swinging for doubles

The 2011 session convenes Jan. 26; that's when new members will be sworn in and the speaker will be formally elected.

The legislature could re-examine the state pay scale, Tillis said. He said he's intrigued by CMS's quest to base teacher pay on student progress and other measures of effectiveness, rather than seniority and credentials.

"I believe it's worked well in business and been successful in some other districts," he said.

And he said he'd consider loosening the state-imposed limits on when the school year stops and starts, as long as changes don't harm the economy. Some businesses that rely on summer vacation trade and/or student labor lobbied for a uniform school year.

Every creative approach that state and local officials can find will help, Tillis said, even though he doubts there's one big answer to dealing with cuts.

"I don't believe there are any home runs out there," he said, "but I do believe there are a lot of singles and doubles."










Thom Tillis Elected New North Carolina House Speaker


North Carolina Republicans narrowly selected state Rep. Thom Tillis of Mecklenburg County on Saturday as their nominee to become the next speaker of the North Carolina House. Tillis is a relative newcomer with fiscal expertise who was the GOP's floor chief for the past four years.

House Republicans claimed 68 seats on Election Day, all but assuring sole GOP control of the 120-seat chamber and the speaker's post for the first time since 1998. The actual vote for speaker occurs Jan. 26 on the session's first day.

Democrat Joe Hackney, who loses his position as speaker to the incoming Republican majority, issued a statement Saturday congratulating Tillis.

"My Democratic colleagues and I look forward to working with him to make our state better," Hackney said.

"We will also continue to support action consistent with our principles. We will oppose policies that take North Carolina backward, that threaten to destroy the remarkable progress we have made in our public schools, our community colleges and our universities, or that threaten our outstanding and highly lauded climate for business."

Tillis, 50, who just won his third term to the Legislature, defeated three other candidates, including Rep. Paul Stam, R-Wake, the minority leader since 2007.

Results of the private meeting, secret-ballot vote weren't released by caucus leaders, who would only say that Tillis won on the second ballot and that the final margin was thin.

Stam unanimously was elected majority leader, which Tillis called a sign of the amicable competition and the good feelings Republicans had for both candidates. Two other candidates who had sought the majority leader's post dropped out for Stam.

"We went in there unified and we came out unified, and I have every reason to believe that that's why we're going to go into the legislative session and make history," Tillis told reporters after the meeting.

Stam said the GOP will lead cooperatively and constructively. "We're still going to cooperate with Democrats whenever we can. In the past, it was out of necessity because it was the way to get our bills passed, but, in the future, we'll do it because it's good government," he said.

Tillis, a former IBM business consultant first elected to the House in 2006 and became minority whip in 2009, has won points for running the campaign operation that raised money and recruited candidates who defeated more than a dozen Democratic incumbents. He said fiscal issues such as taxation and narrowing a projected $3.2 billion budget gap would be the immediate work of the new majority.

"This is a part-time legislature that's going to try and solve that crisis over a six-month period. Most CEOs would go running for the door if they had to take on the task that we've worked hard to take on," he said.

"Our priorities are going to be what they were in the campaign," Tillis said. "We're going to focus on the fiscal situation. We're going to focus on trying whatever we can to create jobs. We're going to live up to our promises."

Stam, an Apex attorney completing his fifth term, also talked fiscal matters but appealed more to social conservatives and has been involved in Republican Party politics since the early 1970s. He first joined the House in 1989 and returned more than a decade later.

Reps. Ric Killian of Mecklenburg County and Mitch Gillespie of McDowell County also ran for speaker Saturday. They were removed from the ballot after they trailed in the first round of voting.

Outgoing Speaker Joe Hackney, D-Orange, has been in the Legislature for 30 years. State GOP Chairman Tom Fetzer said he didn't believe Tillis' relative inexperience is a liability.

"He's going to bring a businessman's focus, a businessman's perspective to the job of speaker. He's not a career politician," Fetzer said. "We need to disabuse ourselves of this notion that people have to be around there forever to effectively lead."

Tillis and Sen. Phil Berger, R-Rockingham, chosen Thursday as the GOP's choice for Senate leader, will become the top Republican leaders in state government, setting the tone for what legislation will be heard and which lawmakers will get plum committee assignments. They'll also serve as chief negotiators with, and likely foils of, Democratic Gov. Beverly Perdue.

Tillis said he won't have all the answers leading the House but said he knows where to find them.

"I have the kind of experience that you need to lead a caucus that has tremendous institutional knowledge," Tillis said.

Unity is a sensitive issue for House Republicans, who struggled through a fracturous decade between those aligned with or against former co-Speaker Richard Morgan, R-Moore. The infighting surfaced in primary elections during the 2004 or 2006, taking out several GOP incumbents. Stam, 60, is credited with restoring the caucus.

House Republicans also agreed to nominate Rep. Dale Folwell of Forsyth County as speaker pro tempore, a largely ceremonial position but one Tillis said Folwell initially will use to help with new member orientation. Folwell still must be elected by the entire chamber January. The caucus also elected Rep. Marilyn Avila, R-Wake, as chairwoman of the joint House-Senate Republican caucus.

The day was largely a joyful one for Republicans, who have held control or partial control of the House for only six years since the 1898 elections. When asked what it will be like switching from minority leader to majority leader, Stam replied simply: "We're going to win a whole lot more votes."


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Thom Tillis Unveils N.C. GOP's 2011 Agenda: Jobs, Budget Cuts, Fiscal Responsibility

Thom Tillis Elected New North Carolina House Speaker


North Carolina Republicans narrowly selected state Rep. Thom Tillis of Mecklenburg County on Saturday as their nominee to become the next speaker of the North Carolina House. Tillis is a relative newcomer with fiscal expertise who was the GOP's floor chief for the past four years.

House Republicans claimed 68 seats on Election Day, all but assuring sole GOP control of the 120-seat chamber and the speaker's post for the first time since 1998. The actual vote for speaker occurs Jan. 26 on the session's first day.

Democrat Joe Hackney, who loses his position as speaker to the incoming Republican majority, issued a statement Saturday congratulating Tillis.

"My Democratic colleagues and I look forward to working with him to make our state better," Hackney said.

"We will also continue to support action consistent with our principles. We will oppose policies that take North Carolina backward, that threaten to destroy the remarkable progress we have made in our public schools, our community colleges and our universities, or that threaten our outstanding and highly lauded climate for business."

Tillis, 50, who just won his third term to the Legislature, defeated three other candidates, including Rep. Paul Stam, R-Wake, the minority leader since 2007.

Results of the private meeting, secret-ballot vote weren't released by caucus leaders, who would only say that Tillis won on the second ballot and that the final margin was thin.

Stam unanimously was elected majority leader, which Tillis called a sign of the amicable competition and the good feelings Republicans had for both candidates. Two other candidates who had sought the majority leader's post dropped out for Stam.

"We went in there unified and we came out unified, and I have every reason to believe that that's why we're going to go into the legislative session and make history," Tillis told reporters after the meeting.

Stam said the GOP will lead cooperatively and constructively. "We're still going to cooperate with Democrats whenever we can. In the past, it was out of necessity because it was the way to get our bills passed, but, in the future, we'll do it because it's good government," he said.

Tillis, a former IBM business consultant first elected to the House in 2006 and became minority whip in 2009, has won points for running the campaign operation that raised money and recruited candidates who defeated more than a dozen Democratic incumbents. He said fiscal issues such as taxation and narrowing a projected $3.2 billion budget gap would be the immediate work of the new majority.

"This is a part-time legislature that's going to try and solve that crisis over a six-month period. Most CEOs would go running for the door if they had to take on the task that we've worked hard to take on," he said.

"Our priorities are going to be what they were in the campaign," Tillis said. "We're going to focus on the fiscal situation. We're going to focus on trying whatever we can to create jobs. We're going to live up to our promises."

Stam, an Apex attorney completing his fifth term, also talked fiscal matters but appealed more to social conservatives and has been involved in Republican Party politics since the early 1970s. He first joined the House in 1989 and returned more than a decade later.

Reps. Ric Killian of Mecklenburg County and Mitch Gillespie of McDowell County also ran for speaker Saturday. They were removed from the ballot after they trailed in the first round of voting.

Outgoing Speaker Joe Hackney, D-Orange, has been in the Legislature for 30 years. State GOP Chairman Tom Fetzer said he didn't believe Tillis' relative inexperience is a liability.

"He's going to bring a businessman's focus, a businessman's perspective to the job of speaker. He's not a career politician," Fetzer said. "We need to disabuse ourselves of this notion that people have to be around there forever to effectively lead."

Tillis and Sen. Phil Berger, R-Rockingham, chosen Thursday as the GOP's choice for Senate leader, will become the top Republican leaders in state government, setting the tone for what legislation will be heard and which lawmakers will get plum committee assignments. They'll also serve as chief negotiators with, and likely foils of, Democratic Gov. Beverly Perdue.

Tillis said he won't have all the answers leading the House but said he knows where to find them.

"I have the kind of experience that you need to lead a caucus that has tremendous institutional knowledge," Tillis said.

Unity is a sensitive issue for House Republicans, who struggled through a fracturous decade between those aligned with or against former co-Speaker Richard Morgan, R-Moore. The infighting surfaced in primary elections during the 2004 or 2006, taking out several GOP incumbents. Stam, 60, is credited with restoring the caucus.

House Republicans also agreed to nominate Rep. Dale Folwell of Forsyth County as speaker pro tempore, a largely ceremonial position but one Tillis said Folwell initially will use to help with new member orientation. Folwell still must be elected by the entire chamber January. The caucus also elected Rep. Marilyn Avila, R-Wake, as chairwoman of the joint House-Senate Republican caucus.

The day was largely a joyful one for Republicans, who have held control or partial control of the House for only six years since the 1898 elections. When asked what it will be like switching from minority leader to majority leader, Stam replied simply: "We're going to win a whole lot more votes."


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Sources: WCNC, WRAL, Google Maps

GOP's 2010 Campaign Strategy: Follow Bob McDonnell & Scott

GOP's 2010 Campaign Strategy: Follow Bob McDonnell


Republicans would be wise look to Gov. Bob McDonnell's recent victory in the Virgina gubernatorial race as a model for 2010 Senate and House campaigns.

McDonnell, a demonstrated social conservative, shied away from emphasizing social issues on the stump and instead focused on tangible problems facing Virginians. He campaigned on transportation, jobs, fiscal restraint and stemming the tide of a frivolous litigation presently hampering businesses.

His messages resonated with Virginia voters, who had not elected a Republican governor in 12years, recently sent two Democratic senators to Washington, and handed Barack Obama the once solid red state in 2008. McDonnell's victory decisively reversed that trend.

To be fair, McDonnell benefited from a weak general campaign opponent who never fully drew the support of the Virginia Democratic base. Nonetheless, biting his tongue on abortion, gay marriage and other hot button social issues (on which I'm sure he was more than willing to speak) netted him the support of independents and moderate conservatives who either stayed home or voted for Obama in 2008. Social and "movement" conservatives, apparently adequately convinced that McDonnell was "one of them", overlooked his unwillingness to preach their gospel on the campaign trail.

In a GOP that the mainstream media loves to portray as "intensely divided", we would do well to follow the McDonnell model when approaching upcoming elections. For the first time in a long while, Republicans of all stripes appear united in their dislike for President Obama's fiscal, regulatory, health care proposals and environmental policies. Focusing on the issues, and not on religious or social warfare, as Gov. McDonnell did, is the most likely pathway to success for Republicans in 2010.

Cameron Lynch: Republican Strategist and President The Lynch Group, LLC


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Sources: Politico, The Arena, Google Maps

Erskine Bowles To Help Lead Obama's Fiscal Commission

Erskine Bowles, Alan Simpson To Lead Obama's Deficit Commission


President Obama on Thursday will sign an executive order establishing the bi-partisan National Commission on Fiscal Responsibility and Reform (previously known as the deficit commission). He will also announce the commission's co-chairs, according to a senior administration official, CBS News White House Correspondent Mark Knoller reports.

The president will appoint former White House Chief of Staff Erskine Bowles and former Republican Senate Whip Alan Simpson will serve as co-chairs, a senior official confirms to CBS News.

Bowles, currently president of the University of North Carolina, served as White House chief of staff under former President Clinton from 1996 to 1998. He brokered the Balanced Budget Act of 1997, with the Republican leadership in Congress, helping to generate the first balanced budget in nearly 30 years.

Simpson represented Wyoming in the Senate from 1979 to 1997. From 1985 to 1995, he was the Republican whip in the Senate, and he chaired the Senate Finance Committee's Subcommittee on Social Security. He now practices law in Wyoming.


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Sources: CBS News, Google Maps

Evan Bayh Resigning; Tired Of Obama's Partisan Lies; GOP Victory

Why Evan Bayh Won't Seek Re-election


Sen. Evan Bayh will not run for re-election, a decision that will shock Democrats and Republicans alike in Indiana.

In prepared remarks, Bayh, 54, cited excessive partisanship that makes progress on public policy difficult to achieve as the motivation for his decision.

“After all these years, my passion for service to my fellow citizens is undiminished, but my desire to do so in Congress has waned,” he said.

“My decision was not motivated by political concern,” he added. “Even in the current challenging environment, I am confident in my prospects for re-election.”

Bayh had never lost an election, from his first win in 1986 as secretary of state, his wins for governor in 1988 and 1992 and his election to the U.S. Senate in 1998 and 2004.

“But running for the sake of winning an election, just to remain in public office, is not good enough,” Bayh said. “And it has never been what motivates me. At this time I simply believe I can best contribute to society in another way: creating jobs by helping grow a business, helping guide an institution of higher learning or helping run a worthy charitable endeavor.”

Only days ago, Bayh’s staff, close associates and Indiana Democratic Party Chairman Dan Parker, who was manager of Bayh’s re-election campaign, had assured an Indianapolis Star reporter that he would definitely seek a third term in the U.S. Senate. And Democrats recently released a poll showing Bayh easily ahead of both former Sen. Dan Coats and former U.S. Rep. John Hostettler, two of the four Republicans seeking the GOP nomination.

But in his statement, Bayh cited recent stalemates in Congress.

“Two weeks ago, the Senate voted down a bipartisan commission to deal with one of the greatest threats facing our nation: our exploding deficits and debt. The measure would have passed, but seven members who had endorsed the idea instead voted ‘no’ for short-term political reasons,” he said. “Just last week, a major piece of legislation to create jobs — the public’s top priority — fell apart amid complaints from both the left and right. All of this and much more has led me to believe that there are better ways to serve my fellow citizens, my beloved state and our nation than continued service in Congress.”

The decision ends one of the brightest political careers by Indiana Democrat, at least for now.

Bayh, the son of former U.S. Sen. Birch Bayh, had been the nation’s youngest governor when he first won Indiana’s chief executive job at age 33 in 1988, and was frequently mentioned as a possibility for vice president, and was on President Barack Obama’s list of only three finalists before Obama settled on former Sen. Joe Biden. Bayh also considered running for president himself, launching an exploratory effort in 2006 for the 2008 Democratic Party nomination before dropping the effort only a couple weeks later.

He was born in Shirkieville, near Terre Haute, to Birch and Marvella Bayh; graduate from Indiana University in 1978 and received a law degree from the University of Virginia in 1981. He and his wife Susan have 14-year-old twin sons, Nick and Beau.

Bayh is expected to discuss his decision at a 2 p.m. news conference today at the IUPUI University Place Conference Center and Hotel, 850 W. Michigan Street.




















Sen. Evan Bayh To Not Seek Re-election


Democratic Sen. Evan Bayh of Indiana has decided to not seek re-election, NBC confirms.

The Indianapolis Star reports that Bayh is attributing his decision to excessive partisanship that makes progress on public policy difficult to achieve as the motivation for his decision.

Bayh scheduled a Monday afternoon news conference in Indianapolis. The Associated Press left messages seeking comment at his Senate office and for state Democratic chairman Dan Parker, who is Bayh's campaign manager.

"After all these years, my passion for service to my fellow citizens is undiminished, but my desire to do so in Congress has waned," he told the Indianapolis Star.

"My decision was not motivated by political concern," he added. "Even in the current challenging environment, I am confident in my prospects for re-election."

Bayh's exit gives Republicans a prime pick-up opportunity. Former Indiana Sen. Dan Coats (R) is running for the seat. Bayh was leading Coats by 20 points (55% to 35%) in a recent Research 2000/DailyKos poll.

Republicans now have Senate pick-up opportunities in at least eight states — Arkansas, Colorado, Connecticut, Delaware, Illinois, Indiana, Nevada, and North Dakota.


GOP needs 10 seats

To take back control of the Senate, Republicans will need to gain a net of 10 seats.

Democrats have pick-up opportunities in at least three states — New Hampshire, Ohio, and Missouri.

Democrats have been hammering Coats for his residence, his lobbying and more. And a Democratic official says Bayh was ahead.

"They polled last week and were way ahead of Coats," the official said, adding that petitions were due tomorrow and the Bayh campaign's "were all done."

The decision "must have been a last minute, personal decision."

As for who could run to replace Bayh, look to Reps. Brad Ellsworth and Baron Hill. Democrats are working to convince either — both of whom represent swing districts in the Southern part of the state. Ellsworth, the former Vanderburgh County sherriff, is seen by some observers as, potentially, the strongest Democratic candidate. Hill is a former Indiana high school basketball star.

On the Republican side, Rep. Mike Pence could reverse course and decide to jump into the race.

"Since petitions due tomorrow, there will be a vacancy and because of that there's a way for the party to name the candidate afterwards," the Democratic official said, adding, "And don't forget how weak the Republican field is right now. Coats now damaged goods, and there's no Mitch Daniels running."

Bayh, 54, grew up mostly in Washington, D.C., and is the son of former Sen. Birch Bayh. He was first elected in 1998.


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Sources: AP, Indianapolis Star, MSNBC, Google Maps

Obama Proposes Freezing All Non-Security Discretionary Funds For 3 Yrs

Visit msnbc.com for breaking news, world news, and news about the economy

Obama Wants To Freeze Discretionary Spending For 3 Years


President Obama will announce in Wednesday's State of the Union address that he's proposing to save $250 billion by freezing all nonsecurity federal discretionary spending for three years, according to two senior administration officials.

The proposed freeze, which could help position Obama in the political center by sharpening his credentials on fiscal discipline, would exempt the budgets of the departments of Defense, Homeland Security, and Veterans Affairs, along with some international programs.

"We are at war, and we're going to make sure our troops are funded adequately," one of the senior officials said.

The officials would not reveal the details of which domestic programs would be cut, as they prepare to face major pushback from liberals in the president's own party because popular education and health spending could be on the chopping block. The details will be officially unveiled February 1, when the president publicly releases his next budget blueprint for fiscal year 2011 -- which starts October 1 -- and beyond.

"We've got to make some tough decisions," the second senior official said. "Everybody is not going to get what they want."

Under the proposal, which would need to be approved by both houses of Congress, all federal discretionary spending would be frozen at its current level of $447 billion per year. Within that parameter, however, individual federal agencies would have the power to give some programs increases, while cutting money elsewhere.

Besides burnishing his fiscal discipline credentials, the move could also help the president force Republicans' hand on whether they're serious about meeting Obama halfway on some of his policy proposals.

Immediate Republican reaction was split, with some senior GOP aides saying the freeze is something they could support, while others said it did not go nearly far enough.

"Given Washington Democrats' unprecedented spending binge, this is like announcing you're going on a diet after winning a pie-eating contest," said Michael Steel, a spokesman for House Minority Leader John Boehner, R-Ohio. "Will the budget still double the debt over five years and triple it over 10? That's the bottom line."

The senior administration officials acknowledged that discretionary spending is only about one-sixth of the entire federal budget, and that much larger savings would come from cutting entitlement programs like Medicare, but the White House believes that cuts need to start somewhere.

"We're not here to tell you we've solved the deficit," said one of the senior officials, adding that the federal government has to go through the "very same process that families" across America have had to go through in their personal budgets.

The move will also spark a major debate within the president's own party, with senior Democrats already saying the cuts would be tough to swallow. A senior Senate Democratic aide said it will prompt a major fight after the Bush administration "underfunded domestic programs for so long."

"Why would we want to play into the Republicans' hands like this?" the senior Senate Democratic aide asked.

But it could also help Obama break ranks with an unpopular Democratic Congress. "Do I expect this to win us a lot of kudos on Capitol Hill? No," one of the senior administration officials said.


Sources: CNN, MSNBC, Rachel Maddow Show

Pres. Obama Announces Gov't Will Save $40B In Contract Costs

Govt. On Track To Save $40B In Contract Costs


President Barack Obama on Monday touted the federal government's efforts to become more efficient, highlighting a new report that shows billions of dollars in savings on contract costs.

The report by the Office of Management and Budget shows that agencies have identified more than $19 billion in contract savings for fiscal year 2010, which began Oct. 1. Obama said that puts the government on track to meet its goal of saving $40 billion annually by fiscal year 2011.

The administration has said the savings will come from terminating unnecessary contracts, ending an over-reliance on contractors and reducing the use of high-risk contracts. Federal spending on contracts has doubled since 2002, reaching $540 billion last year.

"After years of irresponsibility, we are once again taking responsibility for every dollar we spend the same way families do," Obama said at the White House. "These changes will save the American people billions of dollars and they'll help to put in place a government that's more efficient and effective."

Federal employees were asked how the government can do its job better or for less money. More than 38,000 suggestions were submitted during a three-week period, Obama said.

Obama met privately with Nancy Fichtner, a Veterans Affairs Department employee from Loma, Colo., who is the first winner of the government's SAVE, or Securing Americans Value and Efficiency award.

Fichtner suggested that veterans leaving VA hospitals be able to take the medicine they've been using home instead of it being thrown away when they're discharged. Obama said Fichtner's and other suggestions were already being put into practice.

The president also announced a White House forum next month to seek similar ideas from the private sector.


Sources: Kansas.com

Weekly Address: Pres. Obama Offers More Hope For America's Economy...."This Economic Storm Will Pass."

Whitehouse.gov----




Sources: Whitehouse.gov, Youtube

U.S. Economy Beginning To Stabilize...Showing Some Signs Of Progress

MSNBC, NY Post, Reuters----


WASHINGTON - The U.S. economy is finally showing signs of stabilizing in some regions of the country — especially in parts of the Northeast and Midwest — bolstering hopes of a broader-based recovery this year.

A Federal Reserve snapshot of economic conditions issued Wednesday found that most of the Fed's 12 regions indicated either that the recession was easing or that economic activity had "begun to stabilize, albeit at a low level."

The economy remains fragile. But the fact that some Fed regions reported signs of activity beginning to level out raises hope that the recession, which started in December 2007, is drawing to a close.

Four Fed regions — New York, Cleveland, Kansas City and San Francisco — pointed to "signs of stabilization," the survey said. Two regions — Chicago and St. Louis — reported that the pace of economic declined appeared to be "moderating."

Five other regions — Boston, Philadelphia, Richmond, Atlanta and Dallas — described activity as "slow," "subdued" or "weak." Only one region — Minneapolis — indicated that its downward slide in economic activity had worsened.

Combined, the assessments of businesses on the front lines of the economy appeared to be brighter than those they provided for the previous Fed report in mid-June.

The observations in the Fed survey are consistent with an assessment made just last week by Fed Chairman Ben Bernanke: that the economy should start growing in the second half of this year, ending the longest recession since World War II.

Many analysts predict the recession eased considerably in the April-to-June quarter. They're forecasting that the economy shrank at only a pace of 1.5 percent in the second quarter.

That would mark a big improvement from the annualized 5.5 percent drop in the first three months of this year. The government will release the second-quarter results on Friday. Many economists also believe that the U.S. could start growing as soon as the current quarter.

The survey's findings will figure into discussions when Bernanke and his colleagues meet next on Aug. 11-12. The Fed is expected to keep a key bank lending rate at a record low near zero to help nurture a recovery. Economists say the Fed is likely to hold rates at such record low levels through the rest of this year.

Separately Wednesday, the government said orders to U.S. factories for big-ticket durable goods plunged in June by the largest amount in five months, reflecting the troubles in the auto industry and a steep drop in demand for commercial jets.

Overall, orders fell 2.5 percent, much larger than the 0.6 percent decline economists had expected. Orders for commercial aircraft, dampened by the global recession, plunged 38.5 percent.

In the Fed report, manufacturing activity showed "some improvement" in the Richmond, Chicago and Kansas City regions. The regions of St. Louis and Dallas said the rate of decline in factory activity is moderating. The Philadelphia and Minneapolis regions saw manufacturing activity drop, while the rest of the regions described activity at "low levels."

In the factory sector, reports overall suggested that activity "remained subdued" but "slightly more positive" than in the previous survey.

Meanwhile, auto sales were mixed across the country, while travel and tourism was down in a majority of the regions.

Most regions reported "sluggish" retail activity, with shoppers continuing to be price-conscious.

But the Fed regions of Boston, Kansas City and San Francisco reported either "modest sales increases or less negative sales results," the Fed said. The Philadelphia, Atlanta, St. Louis, New York and Dallas regions reported "flat or mixed sales." The remaining Fed regions described them as "soft."

Residential real estate remained "soft" in most Fed regions, though "many noted some signs of improvement." By contrast, commercial real-estate activity weakened further.

Meanwhile, "competitive pressures" were restraining companies' ability to jack up prices. And the weak job market meant companies were more interested in cutting wages than in boosting them. Those observations are consistent with the Fed's prediction that inflation will stay low this year.


Sources: MSNBC, NY Post, Huffington Post

Study Reveals State Tax Revenues Rapidly Declining...At Record Lows

NY Times----

The anemic economy decimated state tax collections during the first three months of the year, according to a report released Friday by the Rockefeller Institute of Government. The drop in revenues was the steepest in the 46 years that quarterly data has been available.

The blow to state coffers, which the report said appeared to worsen in the second quarter of the year, reflects the gravity of the recession and suggests the extent to which many states will probably have to resort to more spending cuts or tax increases to balance their budgets.

Over all, the report found that state tax collections dropped 11.7 percent in the first three months of 2009, compared with the same period last year. After adjusting for inflation, new changes in tax rates and other anomalies, the report found that tax revenues had declined in 47 of the 50 states in the quarter.

All the major sources of state tax revenue — sales taxes, personal income taxes and corporate income taxes — took serious blows, the report found.

As more people lost their jobs, took pay cuts or worked fewer hours, personal income tax collections fell 17.5 percent in the quarter. Weak retail sales sent sales tax collections down 8.3 percent. Corporate income tax collections, which are often highly variable, declined 18.8 percent.

States in the Far West had the largest declines in tax revenue, the report found. Arizona reported the largest drop in personal income tax collections, at 56.1 percent. Alaska experienced the largest overall drop in tax collections, 72 percent in the first quarter, and that was attributed to the state’s unusually high revenue collections in recent years because of high oil prices.

Local governments have fared better during the downturn. The report found that local tax collections rose 3.9 percent in the first quarter, largely because of increased property tax collections, which tend to be relatively stable and which are often based on assessments of value that do not keep pace with true market conditions.

As bad as the first quarter was, the second quarter is shaping up to be even worse, the report said. Preliminary data for the first two months of the quarter, April and May, collected from 45 states, indicated that tax revenues declined by 20 percent compared with the same period last year.

That will force states — many of which are already raising taxes or fees, resorting to layoffs or furloughing employees — to come up with more ways to raise or save money.

“The continuing sharp decline in revenues will likely force more unwanted choices for states in the months ahead,” wrote the report’s authors, Donald J. Boyd and Lucy Dadayan.



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Sources: NY Times, Rockefeller Institute of Government, Charlotte Observer, Flickr, Google Maps