Obama Prepared to add another $12 Billion to Deficit while Stimulus Money Sits

Some lawmakers are questioning President Obama's proposal to add $13 billion to the deficit to fund a one-time $250 Social Security payment, since the bulk of the $787 billion stimulus package is still unspent.

The calls so far are mostly coming from Republicans, who see the recovery act as a fiscal blunder that has failed to stem rising unemployment. In some cases, they see the pot of money as a way to head off additional deficit spending in other areas.

After President Obama called on Congress to approve $250 payments to Social Security recipients to make up for no cost-of-living increase, House Minority Leader John Boehner said he'd be "happy" to support it -- so long as Congress takes the money out of the stimulus.

"The stimulus bill is not working. The American people are asking, 'Where are the jobs?' And if we're going to provide this benefit to our seniors, why don't we take it from stimulus funds that clearly aren't getting the job done?" he said.

Standing beside him, Senate Minority Leader Mitch McConnell said he'd reserve judgment since the House would act first on the request. But he indicated an openness to Boehner's idea, saying, "My guess is our members may want to try to pay for it as well."

Officials say 60 percent of the $787 billion stimulus is left. A chart on the Recovery.gov Web site that tracks spending shows that just 22 percent of the stimulus has been paid out. - FOX News Story

Goldman Sachs Bets Big with Your Money and Hits the Lottery

NEW YORK (Fortune) -- It's probably cold comfort, but Goldman Sachs couldn't have done it without your help.

The New York-based investment firm turned another eye-popping profit Thursday, earning $3.2 billion in the third quarter, as revenue from trading rose fourfold from a year ago.

As Wall Street firms typically do, Goldman set almost half that sum aside to compensate its workers. Through the first nine months of 2009, the firm socked away $16.7 billion, enough to pay the average Goldmanite $526,814.

The bonus pool is on pace to hit $21 billion for 2009, which would match the record bonus payout of 2007.

Goldman said it won't decide the size of the bonus pool till year-end. In any case, the payments will be substantial -- and will come just one year after huge sums of taxpayer dollars were funneled to financial institutions.

Critics charge that the lion's share of Goldman's profits comes from making big bets using cheap dollars printed by the Federal Reserve. Plus, given the crisis that followed the failure of Lehman Brothers, there's a sense that government officials won't let big firms go bust. That in effect gives too-big-to-fail firms a license to bet the house. - CNN Story

Bus Driver Suspended for Honoring Cancer Awareness?

An Illinois bus driver thought he was doing the right thing by wearing a pink tie to help raise breast cancer awareness — until his employer slapped him with a one-day unpaid suspension for the wardrobe choice.

William Jones, 46, bus driver for the Springfield Mass Transit District in Springfield, Ill., says he was told he must take a day without pay for violating the district's dress code, according to the State Journal-Register.

He told the newspaper that he wore the pink tie to honor his relatives who have battled cancer, including his grandmother and his sister, and didn't think it would be a problem, given that his pink tie coincided with the first Friday of October, which is National Breast Cancer Awareness Month.

His employer declined to comment on the specific personnel matter, though Linda Tisdale, the SMTD’s managing director, told the Journal Register that employees are given a standard uniform, which includes neckties. - FOX News Story

Schools have gone overboard with Safety?

As a 17-year-old Eagle Scout continues to wait out a one-month suspension from his upstate New York high school for having a 2-inch pocketknife locked in a survival kit in his car, the U.S. Military Academy says the missed school days could pose a big problem when it reviews his application.

Pressure is mounting on a Troy, N.Y., school board to overrule Matthew Whalen's suspension from Lansingburgh High School, which was issued because of a zero-tolerance policy that is facing increasing opposition from parents and education advocates.

Whalen, a senior, says he stocks his car with a sleeping bag, water, a ready-to-eat meal and the small knife, which was given to him by his grandfather, a police chief in a nearby town.

But Lansingburgh High has a zero-tolerance policy for weapons, and when school officials discovered that Whalen kept his knife locked in his car, he says, they suspended him for five days — and then tacked on an additional 15 after a hearing. - FOX News Story

Retail Sales Fall - Thank Goodness for the Stimulus

U.S. retail sales declined in September by the largest amount this year as car sales plummeted following the end of the government's popular Cash for Clunkers incentives program. But outside of autos, sales were better than expected.

The Commerce Department said Wednesday that retail sales dropped 1.5 percent last month. That's smaller than the 2.1 percent fall economists had expected, but still the biggest setback since sales dropped 3.2 percent in December.

Car sales plunged 10.4 percent, but excluding autos, retail sales rose 0.5 percent. That's better than the 0.2 percent increase analysts expected.

Consumer demand, which accounts for 70 percent of total economic activity, is being watched closely by economists who worry that any recovery from the recession could stall due to rising unemployment and tight credit conditions.

Analysts believe the overall economy, as measured by the gross domestic product, is growing in the second half of this year at an annual rate of 3 percent or more. But the concern is that growth rate could slip sharply next year if consumer spending falters. - FOX News Story

How come all we hear is that the Stimulus is working better than expected. It has saved us all and the great Obama pulled us back from the brink of disaster? Sales continue to fall, unemployment continues to go up, things aren't looking much better. The only real difference is that it isn't the top story on the news every broadcast.

MoreFireworks over AIG Bonuses

WASHINGTON -- The pitched drama over bonuses for bailed-out executives will be revived on Capitol Hill Wednesday as a government watchdog explains how some executives nearly brought down the financial system -- then pocketed millions.

Neil Barofsky, the special inspector general for the $700 billion financial rescue program, will answer questions about a new report outlining the official missteps that led to massive bonus payments for executives at insurer American International Group Inc.

In a report released Tuesday, Barofsky wrote that the Treasury Department did not understand AIG's byzantine pay structures when it gave the firm billions in aid last fall. The government has committed a total of more than $180 billion to wind down the New York-based insurance and financial services conglomerate, and now owns about 80 percent of the company.

AIG's bonuses sparked a political firestorm earlier this year when it was revealed that the government could not legally stop AIG from paying millions in bonuses even after taking billions in bailout money.

Barofsky's appearance is expected to recall testimony in March by Treasury Secretary Timothy Geithner, who was president of the Federal Reserve Bank of New York when AIG first was bailed out. The Federal Reserve provided AIG's first lifeline.

Geithner said at the time he had not known about nearly $1.75 billion in bonuses, retention payments and deferred compensation that AIG was contractually obligated to pay its workers. Millions went to employees in the unit whose bets helped sink the company.

Barofsky found no evidence that Geithner knew about the payments before March. But he wrote that it was a "failure of communication" for the top executive of the agencies overseeing AIG to be unaware of the payments. - FOX News Story

The Democrats will undoubtedly blame this one on Bush. It happened before Obama was in office. However they better choose their words carefully. It is Obama's top guy over the Treasury that was actually in charge when this all went down and he conveniently didn't know about it?

White House and Dems Try to Merge Multiple Health Bills

WASHINGTON -- Now comes the hard part.

With all five congressional health care bills finally out of committee and with a summer of tempestuous town hall meetings behind them, the White House and top Democrats must merge the different bills into versions that can win a majority in the House and get the 60 votes needed to pass in the Senate -- even as the Congressional Budget Office admits it can't confirm whether the legislation will save Americans a dime.

To that end, President Obama is sending his hatchet man, White House Chief of Staff Rahm Emanuel, to Capitol Hill Wednesday in an effort to close the deal with Democrats who remain divided over the details of the bill.

Emanuel will meet with Senate leaders Wednesday to start merging the Finance Committee bill that was approved Tuesday with the Senate Health, Education, Labor and Pensions Committee bill that was passed earlier this year.

On the other side of the Capitol, Speaker Nancy Pelosi and her lieutenants have been at work for weeks trying to blend legislation approved by three House committees. The result is certain to include a government insurance plan, but the details of the "public option" have split the rank and file, and leaders have spent days struggling with the issue.

For now, all eyes are on Senate Majority Leader Harry Reid, who has said he wants to complete the wedding quickly and get historic health care overhaul legislation onto the Senate floor by the week of Oct 26.

Others expected to attend Wednesday's meeting are Sen. Christopher Dodd, D-Conn, who shepherded the Health Committee bill, and Sen. Max Baucus, D-Mont., who oversaw the Finance Committee bill. - FOX News Story

Obama Goes to War with FOX News

Calling Fox News "a wing of the Republican Party," the Obama administration on Sunday escalated its war of words against the channel, even as observers questioned the wisdom of a White House war on a news organization.

"What I think is fair to say about Fox -- and certainly it's the way we view it -- is that it really is more a wing of the Republican Party," said Anita Dunn, White House communications director, on CNN. "They take their talking points, put them on the air; take their opposition research, put them on the air. And that's fine. But let's not pretend they're a news network the way CNN is."

Fox News senior vice president Michael Clemente, who likens the channel to a newspaper with separate sections on straight news and commentary, suggested White House officials were intentionally conflating opinion show hosts like Glenn Beck with news reporters like Major Garrett.

"It's astounding the White House cannot distinguish between news and opinion programming," Clemente said. "It seems self-serving on their part."

In recent weeks, the White House has begun using its government blog to directly attack what it called "Fox lies." David Gergen, who has worked for President Bill Clinton and three Republican presidents, questioned the propriety of the White House declaring war on a news organization.

"It's a very risky strategy. It's not one that I would advocate," Gergen said on CNN. "If you're going to get very personal against the media, you're going to find that the animosities are just going to deepen. And you're going to find that you sort of almost draw viewers and readers to the people you're attacking. You build them up in some ways, you give them stature."

He added: "The press always has the last barrel of ink."

Gergen's sentiments were echoed by Tony Blankley, who once served as press secretary to former House Speaker Newt Gingrich.

"Going after a news organization, in my experience, is always a loser," Blankley said on CNN. "They have a big audience. And Fox has an audience of not just conservatives -- they've got liberals and moderates who watch too. They've got Obama supporters who are watching. So it's a temptation for a politician, but it needs to be resisted."

Nia Malika Henderson, White House correspondent for the Politico newspaper, also questioned the White House offensive against Fox. - FOX News Story

Sen. Reid in Trouble for Re-election Bid

Senate Majority Leader Harry Reid continues to trail the two top Republican candidates vying for his seat in next year's election, a new poll shows.

The Las Vegas Review-Journal reported that former Nevada GOP chairwoman Sue Lowden and former university basketball star Danny Tarkanian both lead the powerful Nevada Democrat in head-to-head matchups for 2010.

The Mason-Dixon Polling & Research survey put Lowden at 49 percent to Reid's 39 percent. It put Tarkanian at 48 percent to Reid's 43 percent.

Reid has persistently trailed his potential GOP rivals in early opinion polls. The latest showed that he's suffering from widespread negative sentiment -- the survey showed 50 percent view him unfavorably, while 38 percent view him favorably.

But the poll consisted of a relatively small sampling size and had a large margin of error. It surveyed 500 voters between Tuesday and Thursday, and had a margin of error of 4.5 percentage points. Reid also has more than a year to turn things around.

The poll showed Nevada voters are largely undecided on who their GOP candidate should be. Among Republicans, 23 percent backed Lowden and 21 percent backed Tarkanian. Seven other candidates polled far below that, and 44 percent of voters were undecided. - FOX News

Obama Administration Blasts Report Showing Reform would Cost Americans More

The White House fired back Monday at the health insurance industry for issuing a study that claims the health care reform bill working its way toward a key vote Tuesday will raise the cost of individual coverage by hundreds of dollars a year.

Linda Douglass, spokeswoman with the Office of Health Reform, said in a statement that the timing of the study, released just hours before the Senate Finance Committee is set to vote on its bill, raises questions about its legitimacy. She joined other Democratic officials in trying to keep the analysis from gaining traction.

"This is a self-serving analysis from the insurance industry, one of the major opponents of health insurance reform," she said. "It comes on the eve of a vote that will reduce the industry's profits. It is hard to take it seriously."

But America's Health Insurance Plans, the industry group that sent its member companies the new study late Sunday, stood by the findings.

Spokesman Robert Zirkelbach rejected the suggestion that the study was timed for maximum impact, saying it responded to changes made to the bill over the last few weeks and was only finalized over the weekend. He said AHIP still supports health care reform, but wants to see additional changes made, either in the Finance Committee or later in the process.

"This data is an important part of the health care reform discussion. American people want to know how these provisions are going to impact the cost of health care coverage," he said.

The accounting firm study projects the legislation would add $1,700 a year to the cost of family coverage in 2013, when most of the major provisions in the bill would be in effect. - FOX News Story

I think that they are mad that this information has made it out to public. Obama's policies always have looked good until you got into the weeds and found out what they mean. This rush for reform will be a major disaster.