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Five reasons why $1 trillion deficits may not be far away for Uncle Sam

Published: Saturday, January 13, 2018 @ 12:00 AM

It wasn’t that long ago that Republicans denounced four consecutive yearly deficits of over $1 trillion during the Obama Administration, but now that the GOP is fully in charge of the White House and Congress, it’s possible the deficit may be heading back into the territory of that very large figure.

The federal deficit in 2017 was $666 billion; the Congressional Budget Office estimates it will be $699 billion in 2018, and after the first three months of the fiscal year, the deficit is running higher than a year ago at this time.

Let’s look at some of the reasons why the deficit might be going up – not only this year – but in the future as well.

1. 2018 deficit running slightly ahead of 2017. As mentioned above, the CBO projects a deficit this year of $699 billion; already in the first three months of this fiscal year, Uncle Sam has run up $25 billion more in red ink than a year earlier. The numbers in December 2017 were actually a couple of billion better than a year earlier, as more tax revenues came in last month. So far, in the first three months of Fiscal Year 2018, record revenues from individual income taxes have come into Uncle Sam, $390.8 billion. That seems to be a good indicator of economic strength.  But will those revenues continue to climb in the rest of 2018?  And what about spending?

2. Tax cuts may reduce revenues in 2018. I can hear people gritting their teeth already. They don’t believe the CBO estimates, and they don’t believe that the tax cuts signed into law at the end of 2017 will lead to a drop in revenues. They will yell, “Static scoring!” on my Twitter time line. But if you look back in history, a tax cut doesn’t always translate immediately into more revenues. In 1981, when President Ronald Reagan pushed tax cuts through Congress, the feds took in $599.2 billion in revenues. By 1983, the figure was basically unchanged at $600.5 billion. The same type of thing happened with the Bush tax cuts of 2001 and 2003. In 2001, revenues were $1.99 trillion. They dropped to $1.85 trillion in 2002, down to $1.78 trillion in 2003, and went up to $1.8 trillion in 2004. Finally in 2005, revenues went above the levels from 2000. If history repeats itself with the Trump tax cuts, there could be a revenue drop this year, which would mean a higher budget deficit in 2018.

3. Spending deal expected to add more to deficit. President Trump has made clear he wants $54 billion more in defense spending for both 2018 and 2019 – Democrats say, okay, then add the same amount of money for non-defense spending. While Republicans don’t want to do that, the GOP doesn’t have 60 votes in the Senate, so there will have to be a budget deal to set the limits on spending going forward. If you are going to have parity, or something close to it, then that means a big chunk of extra spending, as much as $100 billion in 2018 and $100 billion more in 2019. If you hear about a deal in Congress on the ‘budget caps,’ this is what they are talking about.  And when you add in another $100 billion, that’s more red ink.

4. Disaster aid will add more to the deficit. After three major hurricanes – Harvey, Irma and Maria – and a devastating wildfire season out West, the Congress has already approved $53 billion in disaster relief, and much more is likely to be spent. Texas, Florida, and Puerto Rico have all staked a claim for large amounts of money, and in coming weeks, lawmakers could approve another $80 billion or more – and even more money will be needed after that. It wouldn’t surprise me to see the aid figure go over $200 billion, and maybe even higher in 2018. The White House asked for $44 billion in December – the House passed a bill with $81 billion, and that could jump more in coming weeks and months.  The Senate has to act on that disaster aid next.

5. What you’re not hearing about – budget cuts. For all the talk from Republicans and President Trump about cutting federal spending, there is little likelihood that Congress will come through with budget savings to offset new spending in 2018. When the President asked for $44 billion in new hurricane disaster relief late last year, that spending was offset by $44 billion in budget savings proposed by the White House – except those savings wouldn’t happen until 2025-2027. The House tried to get $200 billion in savings from mandatory spending programs over ten years – $20 billion per year – but Senate Republicans refused to agree to that. It’s easy to talk budget cuts, but much more difficult to pass them.  And when you don’t offset extra spending, the deficit goes up.

So, let’s recap.

The CBO estimate for the budget deficit in 2018 is $699 billion, so we’ll call it $700 billion.

If there is a budget caps deal, it would probably add about $100 billion in spending for this year. That’s a deficit of $800 billion.

If there is $200 billion spent on hurricane and other disaster relief, then you are already bumping up against a $1 trillion deficit.

And if the new tax cuts mean stable or lower revenues in 2018 for Uncle Sam – which has happened with the last three major tax cuts in 1981, 2001 and 2003 – that could push the yearly deficit even higher.

Don’t take my word for it – the Committee for a Responsible Federal Budget recently said, “failure to offset disaster funding, along with the lack of sufficient offsets for tax reform and a potential budget caps deal, is likely to lead to the return of trillion dollar deficits by next fiscal year.”

You’ve been warned.

Don’t be surprised if it happens.

 

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Family, friends provide loving tributes to Barbara Bush at funeral service

Published: Saturday, April 21, 2018 @ 10:20 AM
Updated: Saturday, April 21, 2018 @ 4:01 PM

VIDEO: Barbara Bush’s Funeral

Approximately 1,500 guests attended former first lady Barbara Bush's private funeral ceremony in Houston Saturday.

Barbara Bush, the wife of the nation’s 41st president and mother of the nation’s 43rd, died Tuesday at her Houston home. She was 92.

About 2,500 mourners paid their respect at a public viewing held Friday in Houston, The Associated Press reported.

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The service took place at St. Martin’s Episcopal Church in Houston. Jeb Bush delivered a eulogy for his mother. Longtime friend Susan Baker and historian Jon Meacham also gave remarks during the 90-minute service. Multiple musical selections were performed.

A procession followed, with burial at the Bush Library at Texas A&M University in College Station. Barbara Bush will be buried next to her daughter, Robin, who was 3 years old when she died of leukemia in 1953, The AP reported.

Notable guests included first lady Melania Trump, former President Bill Clinton, former first lady and Secretary of State Hillary Clinton, former President Barack Obama and former first lady Michelle Obama, The AP reported.

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Barbara Bush funeral: George H.W. Bush wears special socks in literacy campaign tribute

Published: Saturday, April 21, 2018 @ 1:02 PM
Updated: Saturday, April 21, 2018 @ 2:02 PM

HOUSTON, TX - APRIL 21:  Former President George H.W. Bush, assisted by his son, former President George W. Bush, enter the church during the funeral for former First Lady Barbara Bush on April 21, 2018 in Houston, Texas. (Photo by Brett Coomer - Pool/Getty Images)
Pool/Getty Images
HOUSTON, TX - APRIL 21: Former President George H.W. Bush, assisted by his son, former President George W. Bush, enter the church during the funeral for former First Lady Barbara Bush on April 21, 2018 in Houston, Texas. (Photo by Brett Coomer - Pool/Getty Images)(Pool/Getty Images)

Former President George H.W. Bush is known for wearing festive socks. He wore a special pair of socks Saturday to the funeral of his wife of 73 years, Barbara Bush, in tribute to her work in literacy awareness.

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Barbara Bush, the wife of the nation’s 41st president and mother of the nation’s 43rd, died Tuesday at her Houston home. She was 92.

Bush family spokesman Jim McGrath posted on Twitter that the former president is wearing socks festooned with books.

McGrath went on to say that Barbara Bush's literacy campaign raised over $110 million in 30 years.

The private funeral ceremony is being attended by approximately 1,500 invited guests, including first lady Melania Trump, former President Bill Clinton, former first lady and Secretary of State Hillary Clinton, former President Barack Obama and former first lady Michelle Obama.

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Did you know Barbara Bush’s grandfather was a founder of the Dayton Rotary Club?

Published: Monday, April 16, 2018 @ 10:02 AM

Former first lady Barbara Bush died on Tuesday, according to a statement from the office of George H.W. Bush.

Former first lady Barbara Bush, who died Tuesday night, had strong family ties to Dayton and southwest Ohio.

Her grandfather Scott Pierce was one of the founders of the Dayton Rotary Club. Her parents, Marvin Pierce and Pauline Robinson, met at Miami University in Oxford.

When the family lived in New York years later, Marvin would bring Barbara on trips to Dayton when he worked for McCall Corporation. He went on to be the president of McCall’s, the publisher of Redbook and McCall’s.

RELATED: Former first lady, presidential mom dies | Photos: Barbara Bush through the yearsGeorge and Barbara Bush had ‘storybook’ 73-year marriage

“When I was four or five years old, my father would take me with him on business trips to Dayton, the site of a McCall plant,” Bush wrote in her memoir.

Marvin was a 1916 graduate of Miami University. He was a standout athlete nicknamed Monk. He played basketball, football, baseball and tennis. He was inducted into the Miami Athletic Hall of Fame in 1972.

In her memoir, Bush wrote about her father saying, “Daddy was really bright and graduated Phi Beta Kappa from Miami University in Oxford, Ohio, while at the same time waiting tables and tending furnaces.”

“Miami is where Daddy fell in love with Mother who was studying to be a teacher.”

Pauline and Marvin were married in 1918 in Union County, Ohio.

George and Barbara Bush wave at their supporters in West Carrollton in August 1988.

Pauline was born in Richwood, Ohio, on April 28, 1896. Her father was Ohio Supreme Court Justice James Edgar Robinson.

Pauline died in a car accident in 1949 in Rye, N.Y. When Marvin who was driving the car lost control. She was 53 years old.

Barbara’s brother, Scott Pierce, also attended Miami University. He is 88 years old.

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Bush’s grandparents

Barbara Bush’s grandfather, Scott Pierce, was an insurance salesman for a while in Dayton.

In her memoir, Bush said her grandfather and grandmother “lost all their money in the 1890s, and my grandfather never recovered. He sold insurance in Dayton, Ohio, but the family lived humbly.”

Pierce was among a group of 16 men who formed the Dayton Rotary Club in 1913 and he became the its first president, according to David Williamson, the club’s historian.

Barbara Bush visits Middletown just before the 1988 election.

The story goes that during the Great Dayton Flood of 1913, Scott Pierce’s teenage daughter Charlotte — Bush’s aunt — became separated from her family and had to ride out the flood waters in the attic of another Rotary member. It was several days before her family got word that she was safe.

Rotary International members then came to Dayton’s rescue, making the flood recovery the organization's first ever national relief effort.

“(Scott Pierce) was a big deal in Dayton Rotary,” Williamson said. Words he wrote are presented to each outgoing club president on a plaque to this day.

Bush’s grandmother Mabel Pierce was born in Hamilton County in 1869 and died in Dayton in 1955. Scott Pierce died in Dayton in 1945.

Barbara Bush’s great grandparents, Mabel’s parents, Jerome Pierce and Martha Stokes, are buried in Glen Haven Cemetery in Harrison, about 20 miles northwest of Cincinnati.

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Democratic Party sues Trump Campaign, Wikileaks, others, over 2016 elections

Published: Friday, April 20, 2018 @ 11:56 AM

The legal fight over the 2016 elections expanded further on Friday, as the Democratic National Committee filed a wide-ranging lawsuit against President Donald Trump’s campaign, top aides, one of Mr. Trump’s son, as well as his son-in-law, the Russian government, and others caught up in the investigation of Russian interference in the 2016 race for the White House.

The 66 page lawsuit, filed in the Southern District of New York, where an FBI raid recently took place on the President’s personal lawyer, alleges a broad conspiracy involving Russia, its intelligence service, and members of the Trump inner circle, like former campaign manager Paul Manafort.

“No one is above the law,” the lawsuit begins. “In the Trump Campaign, Russia found a willing and active partner in this effort.”

The charges cover everything from racketeering, conspiracy, computer fraud, trespass, and more, claiming the hacking effort was a coordinated effort with the Trump Campaign, designed to damage the bid of Hillary Clinton for the White House.

Along with the Russian government and intelligence service known as the GRU, the Democratic lawsuit names Julian Assange and Wikileaks, the Trump Campaign, Donald Trump, Jr., Paul Manafort, Roger Stone, Jared Kushner, and two campaign aides who have already agreed to help the Russia investigation, George Papadopoulos and Richard Gates.




The document did not seem to make public any brand new details about how the hacking occurred at the DNC or with members of the Clinton campaign.

In the lawsuit, Democrats charge “Russia’s cyberattack on the DNC began only weeks after Trump announced his candidacy for President,” in June 2015.

“In April 2016, another set of Russian intelligence agents successfully hacked into the DNC, saying that “massive amounts of data” were taken from DNC servers.

The lawsuit makes no mention of the FBI warning to the DNC that it was being hacked, and how that was ignored for weeks by officials at DNC headquarters in Washington.

If the lawsuit actually goes forward, it would not only involve evidence being gathered from those being challenged by the Democrats – but some made clear it could open the DNC hacking response to a further review as well in terms of discovery.


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