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Entries in Deficit (2)

Tuesday
Jul052011

Minnesota Government Shutdown: Neither Side Budging

DC Productions/Thinkstock(WASHINGTON) -- A bipartisan commission of former lawmakers was appointed Tuesday to seek a way around the budget impasse that has shut down the state of Minnesota.

But while the commission starts work to find a compromise to get the state's 20,000 employees back to work and reopen state parks, former Minnesota governor and current Republican presidential candidate Tim Pawlenty encouraged Republicans to stand strong and launched a new campaign ad touting his role as governor in 2005's 10-day stalemate.

"Minnesota government shutdown. Why? Because Tim Pawlenty would not accept Democrats' massive tax and spending demands. Result: Pawlenty won," the ad boasts.

That shutdown was six years ago, but once again the North Star State's government has come to a screeching halt. As the current impasse entered its fifth day Tuesday, some of the state's leading politicians on both sides of the aisle weighed in on the problem.

While Pawlenty bragged about his work in the 2005 impasse and suggested the current stoppage is good for the state, former Vice President Walter Mondale -- a Democrat -- and former governor Arne Carlson -- a Republican -- started a committee to find a solution by week's end. The bipartisan panel will come up with "a third approach," Carlson told reporters, according to Bloomberg News.

In the state capital of St. Paul, Democratic Gov. Mark Dayton was set to meet with the Republican leaders of Minnesota's GOP-controlled legislature. At issue is how to deal with the state's projected $5 billion deficit over the next two years. To reduce the shortfall, one of Dayton's proposals involves raising taxes on the rich, a move Republicans have opposed.

Dayton demanded that Republicans drop their focus on policies involving abortion and stem cell research and instead focus on "the fiscal side of things."

Amid all the partisan bickering, the shutdown continues -- with serious consequences for the Midwestern state. More than 20,000 state employees are now without work. State parks are shuttered. Construction projects paused. Highway rest areas are closed.

"This is a terrible situation," Dayton said.

The deadlock in Minnesota could be a preview of things to come in Washington. Lawmakers in the nation's capital are currently divided on how to raise the nation's $14.3 trillion debt ceiling, while at the same time reaching an agreement to reduce the country's deficits going forward.

Copyright 2011 ABC News Radio

Friday
Oct152010

Government Racks Up $1.3 Trillion in Red Ink Last Year

Photo Courtesy - Getty Images(WASHINGTON) -- The government ran up a $1.3 trillion deficit during fiscal year 2010, the Obama administration announced Friday. It is the second-largest deficit ever, only $122 billion behind last year’s record-high.

The administration touted the final budget deficit for 2010 is not only an improvement from last year, but also from prior estimates released earlier this year. The $1.29 trillion in red ink was $261 billion -- or 17 percent -- less than the estimate in the administration’s budget submitted in February.
 
“By carefully managing the emergency initiatives to stop the financial panic and by accelerating our exit from those investments, we have significantly lowered the cost to taxpayers, bringing the costs of the financial rescue down by more than $240 billion this year,” Treasury Secretary Tim Geithner said in a paper statement. “However, we still have a long way to go to repair the damage to the economy and address the long-term deficits caused by the crisis.”

The administration noted this year’s shortfall was equivalent to 8.9 percent of the nation’s gross domestic product, down from 10 percent of GDP last year.

However, with only weeks before the mid-term elections, Republicans seized on the new numbers to reiterate their calls for a cutback in Washington spending.

“Americans are speaking out, and I share their deep concern about the size of government and the seemingly endless spending in Washington,” Senate Republican Leader Mitch McConnell said in a statement. “After adding trillions more to the national debt, Democrats in Washington now want to take more money from the struggling Americans who need it most -- and from the small-business owners across our country who create jobs. Saying no to more spending, more taxes and more debt is exactly what our constituents have been asking us to do. So we’ll keep doing it.”

The 2010 fiscal year concluded at the end of September.

Copyright 2010 ABC News Radio







ABC News Radio