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Right Turn
Posted at 07:45 AM ET, 08/04/2011

Morning Bits

Abandoning ship? “Al Hubbard leaves policy role with [Tim] Pawlenty.”

Sinking in the Rust Belt. “Obama’s fate in the Rust Belt, like his fate in the rest of the country, almost certainly hinges on the relative health of the economy. But, with economic anxiety riding higher in the Industrial Midwest than in almost any other region of the country, the President’s task of convincing voters that he has earned four more years will be that much more difficult.”

Trying to prevent a mutiny. “The day after the passage of the debt-reduction deal, Defense Secretary Leon Panetta sent a message to the Pentagon’s rank-and-file — and to Congress. Failure to enact further deficit-reduction measures, he said, might trigger ‘dangerous, across-the-board’ cuts to defense.” So did he tell President Obama and his party not to set up the possibility of dangerous cuts?

Running dry? “Tim Pawlenty will be pulling his radio and television ads off the air in the 72 hours before next Saturday’s straw poll in Ames. The former Minnesota governor’s presidential campaign says it’s not short on cash, but simply planning to divert money into turning out supporters at the Aug. 13 event that’s a traditional test of campaign strength.” So did they waste money on TV ads?

Starting to backlog. “Many State Department nominations, however, will remain stalled during Congress’s one month vacation. Yesterday, the Senate Foreign Relations Committee held hearings for three ambassadors who are all presently serving abroad under recess appointments, but need to be confirmed this year: Ambassador to Syria Robert Ford, Ambassador to Turkey Frank Ricciardone, and Ambassador to the Czech Republic Norm Eisen. Undersecretary of State for Political Affairs nominee Wendy Sherman’s confirmation hearing, which was supposed to be today, was cancelled because the Senate decided to end the session earlier than planned.”

Drowning in red ink. “Simply put, our coming debt crisis is a health care cost crisis. In 1971, the government spent 1 percent of GDP on Medicare and Medicaid. Four decades later, spending on these two programs has more than quintupled to 5.6 percent of GDP last year. In its latest long-term outlook document, published in June, the Congressional Budget Office projected that spending on these programs, and on the new entitlements created by Obama-care, will reach 10.4 percent of GDP by 2035 and 13 percent by 2050. In the meantime, all other government spending combined (including Social Security, defense, domestic discretionary spending, and everything other than interest on the debt) will actually decline, from 17 percent of GDP today to 14.6 percent in 2035 and 14 percent in 2050.” Read the whole thing.

Floundering in the Obama economy. “Shoppers won’t shop. Companies won’t hire. The government won’t spend on economic stimulus - it’s cutting instead. And the Federal Reserve is reluctant to do anything more. Without much to invigorate growth, the economy may be in danger of slipping into a stupor like the one Japan has failed to shake off for more than a decade. And Wall Street is spooked.”

Sailing in unchartered water. The Tea Party reinvents Washington. “The debt deal President Obama signed into law Tuesday was shaped largely by the Tea Party movement, which propelled dozens of fresh faces into Congress last year only after the candidates pledged to drastically slash federal spending. . . . There were historically steep cuts, no tax increases and a commitment to even bigger spending reductions in the near future. In response to Tea Party pressure, the measure also requires the House and Senate to vote on a balanced budget amendment, something that hasn’t happened in 15 years.”

By  |  07:45 AM ET, 08/04/2011

Categories:  Morning Bits

 
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