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VP Biden promotes American Jobs Act with Alexandria police chief

September 30th, 2011
Tejinder Singh – AHN News Correspondent

Washington, D.C., United States (AHN) – There was laughter and goodwill as Vice President Joe Biden on Thursday addressed a select audience of law enforcement officials in Alexandria in Virginia saying, “We need better roads, we need better bridges, we need safer streets.”

Sending a message to Congress to pass the $450-billion American Jobs Act Biden said, “We’ve got to kick start this economy that’s stalled.”

Speaking at the spacious new headquarters of the Alexandria Police Department in Alexandria, Va., Vice President Biden announced that the hosting organization had won funds for the hiring of four new officers with the almost $859,000 it received from the more than $243 million in grant funds.

Keeping the focus on American Jobs Act, Biden said, “We need to be in a position where our kids are in classrooms where there’s enough qualified teachers, where they are in fact in classes where they are safe.”

“Look, we should be doing all of this stuff even if we were growing by 8%, even if there was a 3% unemployment rate in America,” Biden. The recent unemployment rate continue to hover above 9% although it was around 7% when President Barack Obama took office in 2008.

In November 2010 the unemployment rate hit 9.8 percent for the third time since Obama signed the first stimulus bill into law. In August 2011 the unemployment rate was 9.1 percent.

Education and jobs for teachers was another major thrust of Biden speech as he talked about getting hundreds of thousands of teachers back to work.

“If anyone is gonna define what the middle class is — which is what we say this is all about — it’s a school teacher, a firefighter, a law enforcement officer. That is the definition of middle class,” Biden stressed.

Alexandria Police Chief Earl Cook thanked the Vice President for the federal grant of $900,000 but noted that he was still about 30 officers short of where he’d like to be as the department continued under pressure for nearly three years with budget cuts.

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September 30th, 2011 05:18:45




Vote on disputed trade bill could be hitched to jobs retraining

September 20th, 2011
Tom Ramstack – AHN News Legal Correspondent

Washington, DC, United States (AHN) – The Senate plans to vote as soon as this week on a bill that would eliminate duties on some imports from 129 nations.

The trade preferences bill has been stalled in a dispute over whether free trade means more Americans lose their jobs to overseas competitors.

President Barack Obama has said he will support the trade preferences bill, but only if it includes a program to retrain American workers who lose their jobs to foreigners.

He is holding up action on three free trade agreements until a job retraining program is included in the trade preferences bill. The free trade agreements would be with South Korea, Colombia and Panama.

Even Republicans who disputed whether to give in to Obama’s demands are saying they can wait no longer.

Sen. Charles Grassley (R-IA) said at a new conference, “Nothing has been done and the United States is losing its leadership in what we’ve done for 60 years in world trade, leading the rest of the world. The status quo has to end.”

The U.S. Chamber of Commerce says the bill, called the Generalized System of Preferences, would prevent the loss of 380,000 jobs.

The free trade agreements, and the duty-free imports bill, are at the heart of disputes over whether preferences for certain foreign imports help or hurt the economy.

Big businesses say the trade preferences give them access to cheaper raw materials and products they sell in the United States, thereby giving their customers a price break.

Labor unions say lowering tariffs for foreign companies with trade preferences results in more American factories and other businesses shutting down.

The National Association of Manufacturers issued a statement this week urging quick action in Congress to approve the Generalized System of Preferences.

“The vast majority of U.S. imports using [trade preferences] are raw materials, parts and components or machinery and equipment used by U.S. companies to manufacture goods in the United States for domestic consumption or for export,” the statement said. “The longer we wait to pass the agreements the more market share we lose to our competitors overseas.”

Companies that support the foreign trade preferences include Wal-Mart Stores Inc., General Electric Co. and Caterpillar Inc.

Since the old trade preferences lapsed Jan. 1, American companies claim to be paying an additional $1.8 million a day in additional tariffs on the goods they import.

The new Generalized System of Preferences bill, HR 2832, would lower tariffs on about 4,800 items, such as radial tires, machinery, silver jewelry and raw materials.

Other support for the bill comes from the U.S. Chamber of Commerce.

The foreign trade preferences legislation would “create a path forward for approval of the pending trade agreements with South Korea, Colombia and Panama, which are among the Chamber’s top legislative priorities this year,” said Bruce Josten, the Chamber’s executive vice president for government affairs.

Senate leaders working on the bill are hinting they will attach an amendment inserting the job retraining program Obama and other Democrats demand. They hope the amendment will give the bill the votes it needs to pass.

After the amendment is attached, the Senate is expected to send the bill back to the House for another vote. The House already approved its own trade preferences bill two weeks ago.

Sen. Minority Leader Mitch McConnell (R-KY) was optimistic about getting the trade bills passed. He said new agreements among senators have created a “path forward” for the proposed legislation.

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September 20th, 2011 21:10:11




Poll: Americans favor tax hikes on wealthy to reduce nation’s debt

August 11th, 2011
Linda Young – AHN News Writer

New York, NY, United States (AHN) – A new CNN/ORC International Poll released on Wednesday found the majority of Americans think it would be a good idea to put higher taxes on the wealthy to help the nation dig out of its massive debt problem.

Among the questions respondents were asked was to state which of three statements came closest to their view. The statements were given in no particular order.

Those statements and the percentage of respondents who said they were closest to their view were:

  • Taxes on wealthy people should be kept low because they invest their money in the private sector and that helps the economy and creates jobs. 34%
  • Taxes on wealthy people should be kept high so the government can use their money for programs to help lower-income people. 62%
  • No opinion 5%

The vast majority of Americans would not be affected by higher taxes on the wealthy.

The bottom 90 percent of all Americans earn $100,000 or less, with about half of those earning $50,000 or less and the majority of those earning $30,000 or less.

Only the top 10 percent of all Americans earn more than $100,000 and even the vast majority of that 10 percent would not be affected by President Barack Obama’s plan for raising taxes on the wealthy

Obama has specifically called for raising taxes only on people who earn $200,000 or more.

A mere 3 percent of Americans earn $200,000 or more. So raising taxes on the wealthy would mean no tax increases for the other 97 percent of Americans.

Other results from the poll found that 57 percent of respondents favored cutting domestic spending to help reduce the deficit. However, nearly 66 percent were opposed to cuts in Social Security or Medicare while 53 percent opposed cuts to the Pentagon.

Moreover, although 62 percent of respondents favored tax increases on the rich, 90 percent said they opposed tax hikes on middle income and lower income workers.

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August 11th, 2011 20:58:50




U.S. slapped with Standard & Poor’s rating downgrade

August 06th, 2011
Tejinder Singh – AHN News Correspondent

Washington, D.C., United States (AHN) – Standard & Poor’s on Friday downgraded the U.S. government”s “AAA” sovereign credit rating while other two major rating agencies Moody’s and Fitch kept the U.S. at “AAA” but Chinese rating agency Dagong Global Credit Rating Co. on Wednesday cut the U.S. from A+ to A with a negative outlook as Washington went through long-drawn inter-party political bickering before raising the country’s debt limit.

With the U.S. economy already facing an uphill task of recovery, Washington got more worried after the announcement of the downgrade and the U.S. President Barack Obama met the Treasury Secretary Timothy Geithner before he left for Camp David Friday afternoon.

China with its largest hold of U.S. Treasuries commented, by proxy, through its official Xinhua news agency saying that Washington needed to “come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone”.

“We have lowered our long-term sovereign credit rating on the United States of America to “AA+” from “AAA” and affirmed the “A-1+” short-term rating. “We have also removed both the short- and long-term ratings from Credit Watch negative,” the credit rating agency said in a statement.

The downgrade, it said, reflects its opinion that the fiscal consolidation plan which Congress and the administration recently agreed to “falls short of what, in our view, would be necessary to stabilize the government”s medium-term debt dynamics.”

“More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policy making and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011,” the agency said.

“Since then, we have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the capacity of Congress and the Administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government”s debt dynamics any time soon.”

S&P statement said: “The outlook on the long-term rating is negative. We could lower the long-term rating to “AA” within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.”

“When comparing the U.S. to sovereigns with “AAA” long-term ratings that we view as relevant peers “Canada, France, Germany, and the UK” we also observe, based on our base case scenarios for each, that the trajectory of the U.S.’s net public debt is diverging from the others,” it said.

Including the U.S., S&P estimated that these five sovereigns would have net general government debt to GDP ratios this year ranging from 34% (Canada) to 80% (Britain), with the U.S. debt burden at 74%.

By 2015, S&P projects that their net public debt to GDP ratios will range between 30% (lowest, Canada) and 83% (highest, France), with the U.S. debt burden at 79%.

“However, in contrast with the U.S., we project that the net public debt burdens of these other sovereigns will begin to decline, either before or by 2015,” it said.

On Monday, S&P will issue separate releases concerning affected ratings in the funds, government-related entities, financial institutions, insurance, public finance, and structured finance sectors, the statement added.

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August 06th, 2011 12:56:04




FAQ On The Debt Deal. Impact On Health Spending Explained

August 03rd, 2011

Washington, DC, United States (KaiserHealth) – The deal President Barack Obama and Congress struck this week to raise the nation’s debt ceiling has prompted many questions about how a special “super committee” established by the law will affect federal health care programs.

By the day before Thanksgiving, the bipartisan, bicameral panel of 12 lawmakers must report recommendations to trim at least $1.2 trillion in federal spending over the next decade. If the committee members don’t reach consensus, or if Congress does not approve a package they offer by Dec. 23, a series of automatic spending cuts would kick in by 2013, creating additional pressure on the panel to act.

Here’s a guide to how the panel’s deliberations could influence Medicare and Medicaid.

Q: Aren’t Medicare and Medicaid are protected from cuts, right now?

A: Yes-and no. The debt deal, which was signed into law by Obama on Aug. 2, makes $917 billion in discretionary spending reductions during the next decade. Neither Medicare nor Medicaid would be touched in those reductions.

However, that changes a bit in the second round of funding cuts called for in the law. Between now and Nov. 23, the super committee is asked to find at least an additional $1.2 trillion in debt reduction over 10 years. The panel can make those recommendations by changing any part of the budget. The committee could recommend cuts in entitlement programs, including Medicare and Medicaid. It could also propose tax increases.

Q. Won’t deep differences between the parties over the structure and future of entitlements and taxes prevent the panel from reaching any agreement?

A. Democrats are sure to insist on tax increases to match any spending cuts, which will anger Republicans, and Republicans will surely want entitlement cuts, which will upset Democrats.

Stan Collender, a partner at Qorvis Communications and former congressional budget staffer, said he gives less than 5 percent chance the committee will come to an agreement that Congress will approve. “In an era of hyper partisanship have you seen any other special committee of elected officials come up with some broad-based deficit reduction package looking at tax increases and spending cuts?” he asks.

If Congress doesn’t agree on a debt plan, the current law has a trigger mechanism that will automatically guarantee the $1.2 trillion savings beginning in 2013 through cuts in defense and other federal spending. Included in these cuts would be is a 2 percent reduction in Medicare payments to hospitals and other providers. Medicaid funding would not be touched by that trigger.

Sen. Pat Roberts, R-Kan., describes the idea of across-the-board cuts as “Armageddon” because of their severity and that half of the cuts would have to come from defense. “You can’t cut defense by 50 percent. You can’t cut Medicare providers, including doctors, more,” Roberts said.

Q: There have been plenty of commissions that have worked on debt reduction, including the Simpson-Bowles panel last fall. What makes this different?

A: The threat of the automatic, across-the-board spending cuts is what gives the debt panel more clout than its predecessors, including a commission established by Obama and co-chaired by former Sen. Alan Simpson, R-Wyo., and former President Bill Clinton’s chief of staff Erskine Bowles. Many lawmakers dislike the idea of surrendering any power over the federal purse, especially when it could mean that spending on a favorite program could be at risk.

The committee will look at many of the same alternatives as the deficit task forces earlier this year formed by Obama and the Bipartisan Policy Center, which was headed by President Clinton’s budget director Alice Rivlin and former Senate Budget Committee chairman Pete Domenici, R-N.M., and a plan formulated by a bipartisan group of senators known as the Gang of Six.

Q. What else will the super committee be looking at?

A. Among some of the alternatives expected to be considered are Medicare premium supports, which would give enrollees vouchers or credit to purchase a private insurance plan rather than having the government directly pay for covered services; converting Medicaid to a block grant program, which would also limit federal funding; or asking higher-income Medicare beneficiaries to pay more for their coverage. Changes in spending for the 2010 health care overhaul may also be considered.

Collender doubts Democrats on the committee would accept major changes to either Medicare or Medicaid.

“I don’t see the trigger as a sort of sword hanging over their head,” he said, noting that Congress can always vote again to reverse the cuts planned under the trigger. He said if the economy continues to falter, he would doubt Congress would allow funding cuts to occur.

But Bob Crittenden, executive director of the liberal Herndon Alliance, said Medicaid is most at risk in the super committee because the group is unlikely to agree on cuts to Medicare or Social Security.

Steve Bell, senior director or the economic policy project at the Bipartisan Policy Center, said he expects the super committee will lead Congress to make some cuts to the deficit but no dramatic restructuring to entitlement programs. That’s because the savings goal is not high enough and the two political parties can’t agree on the main options to reduce spending in Medicare and Medicaid. “You will get out of this what you got out of the last four months-something mushy in the middle that does not address the underlying fiscal crisis,” he said.

Q. Why are Medicare and Medicaid part of the debt discussions?

A. Medicare and Medicaid make up about 23 percent of federal spending and their costs have been growing faster than the overall economy. Spending for both programs is rising as a result of overall cost of health care, but each has its own issues. Medicare costs have climbed partly due to the aging population, which has meant more people are eligible for coverage under the program. Medicaid costs increased with the recent economic downturn, which led to dramatic uptick in enrollment as people lost jobs and private health coverage.

Q. What do doctors and hospitals say about the cuts proposed as part of the automatic trigger?

A. Although the debt ceiling law says that only Medicare providers could face cuts, providers say those reductions could impact their ability to deliver medical care and impact beneficiaries.

“From our view, there’s no separation between these kinds of provider cuts and something that will affect beneficiaries,” said Chip Kahn, president and chief executive officer of the Federation of American Hospitals. “It will affect the way providers operate and at some point this artificial separation between things that affect beneficiaries and provider cuts has got to be identified for what it is – an artificial break. If it affects providers, it affects beneficiaries.”

Rich Umbdenstock, the American Hospital Association president and chief executive, echoed that sentiment. In a statement he said cutting hospitals will mean decreased access for seniors. “That’s why the total Medicare program – including caregivers – should be exempt” from cuts that he said could overload emergency rooms, shut trauma units and reduce patient access to the latest treatments.

Q. How does a “fix” to Medicare’s doctor payments figure into the issues facing the super committee?

A. At the end of the year, Medicare is scheduled to cut pay to physicians by about 30 percent. That is caused by a budget rule adopted years ago. Since 2003 each time the requirement has come due Congress has averted it. Some analysts argue that the debt reduction efforts and the need to fix the doctor reimbursement formula could collide, especially because of the cost of fixing doctor pay. Pushing the issue off for another year would cost about $25 billion, although doctors have been pressing for a two-year fix at a cost of roughly $50 billion. These fixes would add to the nation’s deficit and complicate the super committee’s work.

Q. This sounds similar to the BRAC (Base Realignment and Closure) commission used by Congress to decide which military bases to close. Will it work the same?

A. BRAC was an independent nine-member panel appointed by the president that evaluated which bases to close from’98 to 2005. Once that list was approved by the president, Congress could change it only by voting down the list in its entirety.

Similar to BRAC, the super committee’s recommendations will face an up-or-down congressional vote. Congress will not be able to amend the recommendations. But the super committee’s charge is far broader than BRAC since it will be able to make recommendations on cutting or changing any type of government program. It also will have to grapple with deciding whether to recommend raising taxes.

“This is a heckuva lot bigger than BRAC-the concept is the same-but its purview is the broad range of government and entitlement programs,” said Robert Bixby, executive director of the nonpartisan Concord Coalition, a budget watchdog group. He gives the committee less than a 25 percent chance of coming to an agreement.

– Provided by Kaiser Health News.

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August 03rd, 2011 21:08:50




Federal Reserve to retain record-low interest rate

July 12th, 2011
Vittorio Hernandez – AHN News

Washington, D.C., United States (AHN) – The U.S. Federal Reserve would likely keep the record-low interest rates, Treasury markets indicate.

According to a Federal Bank of Cleveland study, the U.S. economy is forecast to grow by only 1.1 percent in the 12 months ending June 2012. That rate is less than half of the central bank’s current forecast and would likely result in delaying any key lending rate increase.

The Fed has held benchmark interest rates from zero to 25 basis points since December 2008.

Given the slower growth of the American economy, analysts said that the Fed is not likely to hike interest rate until June next year. That would make it the longest period that the central bank has held on to a low key lending rate since the 1940s when the Fed was forced to buy Treasuries.

From 1937 through 1947, the Fed kept its rediscount rate at 1 percent. It was the last time the American central bank maintained a prolonged monetary support for the ailing U.S. economy.

Another restraint to the expansion of the U.S. economy would be spending cuts to be agreed by U.S. President Barack Obama and Congress before the Aug. 2 deadline to hike Washington’s debt limit of $14.3 trillion.

However, analyst said the biggest hindrance to raising the overnight lending rate from almost zero would be the U.S. economy’s failure to create more jobs. The recession and the global financial crisis led to the loss of 8.7 million jobs in the U.S. in 2008 and 2009. In 2010, only 1.7 million jobs were created, resulting to national unemployment rate rising to 9.2 percent in June from 8.8 percent in March.

Fed Chairman Ben Bernanke placed a condition of sustained period of strong job creation as a basis for declaring an economy recovery. That translates into a gross domestic product growth rate between 2.7 to 2.8 percent.

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July 12th, 2011 05:03:37




IMF and Bill Clinton warn of excessive U.S. debt

June 30th, 2011
Vittorio Hernandez – AHN News

Washington, D.C., United States (AHN) – An international agency and a former president warned the U.S. about the perils of its excessive spending on Wednesday.

The International Monetary Fund pointed out that the U.S. debt burden is on an unsustainable trajectory, but advised Washington against a sharp correction to protect its fragile economic recovery.

In its yearly review of the American economy, IMF urged U.S. officials to reach an agreement on a deal to raise Washington’s borrowing limit.

The IMF estimated that the U.S. budget deficit would hit $1.4 trillion this year, higher than last year’s $1.29 trillion gap. However, it is slightly lower than the record-high $1.41 trillion registered in 2009.

The fund also forecast a lower economic expansion this year for the U.S. at 2.5 percent and 2.7 percent for 2012. It is lower than the U.S. Federal Reserve’s projection of a 3.3 percent gross domestic product growth rate next year.

Former U.S. President Bill Clinton made a similar warning on Wednesday in his address at a conference on job creation.

He said the U.S. spent too much money and continues with such a policy that there might not be enough funds left for the future. Clinton also said at the first panel discussion at the Clinton Global Initiative two-day conference in Chicago that Washington is borrowing too much, which would create more problems later.

The former president suggested a better mix of federal spending and taxes as a proportion of U.S. GDP. He stressed the federal government could no longer afford to spend 25 percent of the country’s GDP on government expenditures, but tax only 15 percent of the GDP.

The two separate warnings come amid a deadlock between President Barack Obama and congressional Republican leaders over how to reduce the budget deficit and reach an agreement that would raise the U.S. borrowing limit.

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June 30th, 2011 05:12:05




Obama’s approval ratings drop as economy stagnates

June 28th, 2011
Ayinde O. Chase – AHN News Staff

New York, NY, United States (AHN) – After slowly inching upward, President Barack Obama’s approval rating has once again dropped, based his handling of the nation’s economy. The downward move ties his lowest rating ever, in of October of last year.

Based on a recent Harris Poll, one-quarter of Americans (27 percent) give the President positive ratings on the overall job he is doing on the economy while almost three-quarters (73 percent) give him negative marks. Last month, one-third (32 percent) gave him positive marks and 68 percent gave the president negative ratings on the economy.

The future of the economy is also seen in a negative viewpoint. In February, more than one-third of Americans (34 percent) said they expected the economy to improve in the coming year, one-quarter (25 percent) thought it would get worse and two in five (42 percent) believed it would stay the same. This month, just one-quarter (26 percent) expect the economy will improve in the coming year, one-third (33 percent) say it will get worse and two in five (41 percent) believe it will stay the same.

One thing the White House also has to deal with in the next few months is the issue of the debt ceiling and whether it should be raised. Only one in five Americans (21 percent) are in favor of raising the debt ceiling while almost half (45 percent) are not in favor of raising it. However one-third of U.S. adults (34 percent) aren’t completely sure if it should be raised nor have a firm grasp of what it is.

If the debt ceiling is not raised, the government will be forced to temporarily stop paying for certain things to conserve funds.

With the presidential election 16 months away, one of the main areas expected to be hotly debated and used as a political hammer will be the economy.

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June 28th, 2011 20:57:22




Obama: America’s future tied to funding education reforms

March 04th, 2011
Matthew Borghese – AHN News Contributor

Miami, FL, United States (AHN) – President Barack Obama was the guest of honor Friday afternoon at one of Florida’s formerly failing high schools to deliver a speech pushing America to refund and reform education.

Obama spoke alongside Education Secretary Arne Duncan and former Florida Gov. Jeb Bush, but only after cheering students from Miami Central Senior High, a majority African American school, gave a heartfelt welcome to America’s first African American president.

“How do we attract new jobs, new businesses, new industries to our shores?” Obama asked the crowd. “How do we grow our economy and out-compete our competitors? In today’s economy, companies are making decisions on where to locate, who to hire, based on key factors [including where to find] highly skilled, highly educated workers – that’s what they’re looking for.”

“I decided to come to Miami Central to kick-off ‘Education Month’ because you’re doing what I challenged states to do when I took office, and that’s turning the lowest performing schools around,” Obama said.

In his address, Obama outlined plans to increase funding for failing schools, citing Miami Central as proof federal assistance aimed at turning around “F” institutions can produce real results. The Department of Education has been giving states School Improvement Grants (SIG) since 1965, but Obama boosted funding as part of the American Recovery and Reinvestment Act of 2009. Duncan pushed for $3.5 billion in SIG funding in 2009 and Obama has added an additional $545 million in funding for 2011.

Obama toured Miami Central, making a surprise visit to spill-over students who couldn’t fit into the gym and thought they were going to see the president speak from a television. Awaiting the Commander-in-Chief’s speech in the school’s library, the students were given a surprise visit from Obama, who received a warm welcome. Other students showed the president their work in creating robots in the classroom.

“This used to be a place where problems on the streets followed children into the classrooms,” Obama explained. “Where there was a culture of failure that brought everyone down. Now, turning around these schools isn’t easy… we have to reform how things are done. It isn’t easy to turn around an expectation of failure, and turn that into an expectation of excellence.”

In Florida, SIG funding totaled $170.2 million, with almost $14 million going to 19 embattled schools in Miami-Dade County, home to America’s fourth-largest public school district serving more than 380,000 students. One SIG success story is Miami Central High School. Miami Central earned an “F” the year Obama took office, but after receiving federal SIG funding, the school improved to receive a “C” this year.

“Here’s what I say; I’m not willing to give up on any child in America. I’m not willing to give up on any school in America. I do not accept failure here in America. I believe the status quo is unacceptable. I believe it’s time to change, and it’s time we come together. Just like Jeb [Bush] and I are doing today – to give every child in America the chance to live up to their God-given potential.”

“A good education equals a good job,” Obama explained. “If we want more good news on the jobs front, we need to make more investments on the education front.”

“Educational achievement is an issue of national priority,” added Bush, whose father and brother have both served time as Republicans in the White House. “Every child, regardless of their zip code or family income should have access to a quality education.”

Aboard Air Force 1 enroute to Florida, newly installed White House Press Secretary Jay Carney explained Obama’s had his eye on Miami Central for a while. “The president very much wanted to go to this particular high school to highlight the dramatic turnaround they have accomplished there and still in the process of accomplishing, and also to make the point that by having former Gov. Jeb Bush join him at this event that he firmly believes what I think most Americans believe and that certainly former Gov. Bush believes, and that is that education and education reform are not Democratic issues, they’re not Republican issues, they’re American issues.”

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March 04th, 2011 20:59:53




Senate Democrats yield to Republican demands for major cuts in draft budget bill

February 26th, 2011
Vittorio Hernandez – AHN News

D.C., Washington, United States (AHN) – Senate Democrats started to draft a budget bill to prevent a political standoff and federal shutdown next week. The draft budget yields to Republican demands to reduce the size of government.

The bill will expedite around $33 billion in program cuts and reductions that were included in U.S. President Barack Obama’s proposed budget for 2012.

Included in the cuts are those adopted by the Republican controlled House of Representatives, such as $8.5 billion worth of Obama’s pet projects.

Both houses need to fast track the budget approval because the temporary measures that finance federal operations are set to expire March 4. Unless a new spending measure is approved, the federal government will have to shut down.

Republicans said they welcome the move by the Senate Democrats to comprise on cuts. The House last week reduced $61 billion from domestic agency budgets for March to September. The cuts were denounced by the White House and congressional Democrats too drastic and pose a potential harm to the American economy.

Republicans insist the $61 billion cut is still not enough. They pointed to a new Gallup poll that said 25 percent of survey respondents agree with the Republican spending plan and 37 percent even want deeper cuts.

To further curb spending, Nevada Republican Senator John Ensign introduced a bill in January to mandate all low-security inmates to work 50 hours a week. Ensign said aside from reducing government cost, the measure would give the prisoners some purpose in life and an opportunity to learn skills.

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February 26th, 2011 04:55:21