Washington Watch - February 24, 2010


Washington Watch - February 24, 2010

President Obama Creates Fiscal Watchdog Agency

In order to address concerns about the growing federal deficit, Pres. Obama has created a bipartisan group responsible for overseeing budget decisions. The National Commission on Fiscal Responsibility and Reform will tackle the following issues:

  • The Commission will make recommendations that put the budget in primary balance so that we are paying for all operations and programs for the federal government (achieving deficits of about 3 percent of GDP) by 2015 and meaningfully improve the long-term fiscal outlook.
  • The Commission will be comprised of 18 total members. Twelve members will be appointed by Senate/House leaders (three each by the Republican and Democratic leaders of both chambers). All must be sitting members of Congress. The additional six members will be appointed by the President, with no more than four from the same political party.
  • Fourteen out of eighteen votes are needed to report recommendations, and recommendations must be reported to Congress by December 1, 2010.

The committee will be chaired by a former Clinton Administration Chief of Staff Erskine Bowles and former Republican Senate Whip Alan Simpson.

White House Releases Health Reform Plan Before Summit

The White House began another push for health reform this week by releasing a $950 billion plan signaling a new phase of increased presidential involvement. After a year of keeping himself mostly removed from the legislative process, President Barack Obama entered the fray with his first concrete blueprint for reform ahead of this week’s bipartisan health care summit.

The president’s plan takes the broad framework of the House and Senate bills, which require individuals to purchase insurance, provide subsidies for lower-income Americans to buy coverage and prohibit insurers from refusing coverage to those with pre-existing conditions.

The plan appears designed to appease those in both the House and Senate. The White House plan delays a tax on “Cadillac” health insurance plans until 2018 for all Americans, but does not include a public option. Perhaps in a nod to Republican talking points, the plan augments measures to limit waste, fraud and abuse in Medicare.

The proposal eliminates some of the most criticized provisions of the Senate bill and strengthens popular elements, such as fully closing the “doughnut hole” for Medicare prescription drug beneficiaries. President Obama’s proposal also includes a legal requirement for all Americans to own insurance, but lowers the penalty on individuals without coverage to $325 in the first year.

While the plan would raise the Medicare payroll tax on couples earning more than $250,000 a year, the White House described the subsidies for lower-income Americans to purchase health insurance as the “largest middle-class tax cut for health care in history.” The plan also gives the federal government wide-ranging new powers to curb exorbitant rate hikes by the nation’s health insurance companies.

Read more about it here.

Senate Considers Small Business, 2nd Jobs Package

The Senate has been busy in past weeks focusing on improving the economy through job creation and, in particular, through the aid of small businesses. The Senate Finance Committee recently held a hearing on trade and tax issues. Chairman Max Baucus (D-Mont.) argued that provisions like increased expending for small business owners and additional aid for startups are essential to recovery efforts.

In the meantime, the Senate passed a $15 billion jobs package this week. The bill includes payroll tax relief for businesses that hire new workers and extensions of the Highway Trust Fund, the “Build America” bond program and expense deductions for small businesses. “We have a jobs agenda, not a jobs bill,” said majority leader Senator Harry Reid (D-Nev.). “We’re going to have more votes, and create more jobs.”

Read the full text of the recently passed bill.

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