Balanced Budget

November 17 - The International Herald Tribune reports that many states are facing the serious prospect of major budgetary shortfalls due to the economic downturn. Because many states are required by law to balance their budgets, some will be forced to either raise taxes or significantly cut spending to make up the difference.  California, providing one of the most dramatic examples, has a $15 billion gap between estimated revenues and expenditures.  In sum, all but approximately twelve states-mostly those with rich oil and mineral resources--will likely have difficulty balancing their budget for 2009. Already, over the past few weeks, several cities and

November 11 - Democratic representative Pete Stark, chair of the House Ways and Means Health Subcommittee, declared yesterday that Congress should waive its PAYGO rules to pass a fundamental reform of the healthcare system and to avoid massive Medicare payment cuts to physicians. Stark cited the waiving of PAYGO for other spending measures like the $700 billion dollar rescue package and Iraq war costs, and asked why large numbers of uninsured should not represent an equally urgent priority. US Budget Watch estimated that plan for health care reform put forward by the Obama campaign would add $52 to $106 billion to the deficit in 2013.

October 23 - In a debate with Obama advisor Austan Goolsbee, Senator McCain's Chief Economic Advisor Doug Holtz-Eakin suggested that McCain would no longer be able to balance the budget by the end of his first term in office. Although Senator McCain stood by this pledge as recently as two weeks ago, Holtz-Eakin explained that:

"The events of the past few months have completely thrown a wrench into [the balanced-budget proposal], there's no way round it. He would still like to balance it. It's going to be harder [and] take longer."

October 10 - In Thursday's Washington Post, David Broder expressed dismay that both presidential candidates continue to advocate for the bulk of their campaign spending and tax promises, which US Budget Watch estimates at well over $300 billion. Calling the move a "stunning rejection of reality," Broder said the candidates had squandered an opportunity during the debates to tell the American people how and where they would adjust the nation's spending priorities. He continued:

"If either of them has a clue what to do to help stabilize this tottering economy, he is keeping it to himself... Even when they have been specific, it is hard to credit their words. Both have promised broad tax reductions targeted to different populations. But neither has given any indication how the promises will stand in the face of the massive new spending needed to rescue embattled financial institutions. Absent any reliable information about their programs, voters must fall back on an examination of their records and characters."