As state budgets are increasingly shrinking, many are getting "creative" as they look for ways to meet the spending requirements in order to receive matching federal welfare funds.
In the face of the $500 billion "taxmageddon" tax increase coming in 2012, Congress will pass the buck. Nothing is likely to happen before the election, and the lame duck Congress will then drop-kick the issue into next year by extending current law and letting the new Congress deal with it.
On Wednesday the Senate voted down five budget proposals, reflecting gridlock and unwillingness to face reality. Four of the budget proposals were presented by Republican senators, while the fifth was based on President Obama’s budget.
House speaker John Boehner decided on Tuesday to fire the first round in the coming battle to deal with the huge tax increases taking place after the first of the year by setting the terms for the debt ceiling debate. In a speech at the Peter G. Peterson Foundation’s 2012 Fiscal Summit in Washington Boehner said that any discussion would revolve around his “Boehner principle” — every dollar of additional debt increase for the federal government must be matched by an equal or greater reduction in government spending.
On Thursday morning, the House Armed Services Committee passed the 2013 version of the National Defense Authorization Act (NDAA); the provision providing for the indefinite detention of Americans remains in the bill.