Liberals like to think of the Constitution as an evolving, elastic or flexible document, but in this case they are simply making it up. The president has no authority unilaterally to saddle the country with more debt. Article I Section 8 of the Constitution grants Congress the power "to borrow money on the credit of the United States." This is a specific, enumerated power given to Congress alone. The debt provision of the 14th Amendment was originally intended simply to ensure Federal debts accrued during the Civil War and deny any claims for compensation on debt entered into by the Confederate States. It was not a sweeping and unprecedented grant of executive power that has lain dormant for a century and a half. And the part of the Section 4 that liberals like to edit out is the passage that states debt must be "authorized by law," not by executive diktat. And if this does not convince them, Section 5 states clearly that "the Congress shall have power to enforce, by appropriate legislation, the provisions of this article." In fact the debt provision of the 14th Amendment means the exact opposite of what leftists are trying to torture out of the text.
Friday, July 29, 2011
The 14th Amendment
Liberals like to think of the Constitution as an evolving, elastic or flexible document, but in this case they are simply making it up. The president has no authority unilaterally to saddle the country with more debt. Article I Section 8 of the Constitution grants Congress the power "to borrow money on the credit of the United States." This is a specific, enumerated power given to Congress alone. The debt provision of the 14th Amendment was originally intended simply to ensure Federal debts accrued during the Civil War and deny any claims for compensation on debt entered into by the Confederate States. It was not a sweeping and unprecedented grant of executive power that has lain dormant for a century and a half. And the part of the Section 4 that liberals like to edit out is the passage that states debt must be "authorized by law," not by executive diktat. And if this does not convince them, Section 5 states clearly that "the Congress shall have power to enforce, by appropriate legislation, the provisions of this article." In fact the debt provision of the 14th Amendment means the exact opposite of what leftists are trying to torture out of the text.
5 common PC problems
----by Kim Komando
7/29/2011
The toaster is a typical electrical gadget. It browns your bread. Yes, it can be made difficult with too many choices. But, basically, anyone can operate it.
It will be a great day when computers achieve toaster-like simplicity. They are not there yet. And they show no signs of getting there anytime soon.
I have been answering computer questions for 15 years. I still get questions I have never seen before. It's really amazing.
Nonetheless, certain questions pop up with regularity. No matter how many times I address them, they still come in. Some things cannot be said too often, I guess.
Certain problems are relatively common. Some result in replacement of the computer, often unnecessarily. Even a rank amateur can fix many problems. Taking it to the computer store will be expensive; you'll be lucky to escape for less than $250. You should try to fix it yourself.
1. The spyware plague
A message pops up repeatedly, telling you to buy a security program. It happens so often that you can't get any work done.
This is adware, or spyware. It's probably the most common problem of all. Somewhere along the line, you were offered a free scan. The program "found" terrible things on your computer. It wants you to buy the product to clean your hard drive.
Your gut tells you that this is a ripoff. Your gut is correct. This is fraudware. Use this site to stay current on fake antivirus programs.
Let's say you bought the program and ran it. If you ran the scan again, it would "find" the same problems. They were never there to begin with.
Running antivirus software probably won't help at this point. To stop the pop-ups, you must run an anti-spyware program. There are a number of good ones. I'd use Ad-Aware and Windows Defender.
You can download more anti-spyware for free from my Security Center. Download antivirus and a firewall while you're there. They will help keep viruses and other malicious programs off your computer.
2. The dead computer
You turn on your computer first thing in the morning. Nothing happens. No lights come on, no fans whir. Nothing. Your computer is dead.
What's the usual response? Well, it's old. It's time to get a new one. Nothing wrong with that, so long as you have plenty of money. The rest of us will want to fix it.
Before you start, make sure the computer is plugged in. Yes, yes, you feel certain that it is. Nonetheless, double-check!
Assuming you're right, the problem is probably a burned out power supply. You can replace it, if it's a desktop. If your computer's a laptop, and out of warranty, replace it. Only a professional should fix a laptop. Professionals are expensive.
To repair a desktop, unplug all the external cables. Open the side of the box by removing screws in the back. The power supply is in the upper rear. A bundle of wires leaves it, connecting to everything in the box. Get out your camera phone and take many pictures. Refer to them if confusion strikes.
On the side of the power supply, you'll see the power rating. It's probably 300 to 400 watts. Go to the electronics store and find a near match. Expect to spend $30 to $60.
Back home, ground yourself on the computer's frame. (Static electricity will kill electronics.) Remove the screws attaching the power supply to the computer. Move the burned out unit out of the way. Do not detach the cables. Install the new power supply. Then, unhook the old cables and replace them, one by one.
When you finish, reinstall the side of the box. Hook up the external cables, and fire up the computer. Congratulate yourself on saving several hundred dollars!
3. The monitor is dark
This is another reason many computers are replaced. Buying a new monitor is much less expensive. And a new video card is less expensive still.
There are two cables attached to the monitor--power and video. Make sure both are tight. Be sure the power cable is plugged into the electrical outlet.
Is the power light on the monitor lit? If so, we'll have to look further. If not, you probably need a new monitor. Check out my Buying Guide for monitors.
Either way, I'd still want to test that. Try to find a working monitor. Perhaps you have one on another computer. Or, maybe a friend can lend you one. Hook up the replacement monitor. If it works, the old one is bad. If it doesn't, something else is happening.
Many computers have video cards. These are small circuit boards, stuck into the mother board. The video cable from the monitor attaches to this card. Video cards can burn out. I'd buy another, and put it in the computer. If it doesn't solve the problem, you can always return it (make sure the retailer will allow returns before buying it, though).
The video system is built into the motherboard on many computers. If it goes bad, the motherboard can theoretically be replaced. That's beyond the abilities of most people. Buy a new computer.
4. The blue screen of death
So, your computer is working fine. You're playing a game, racking up points. Suddenly, you get a blue screen. It says there's been an error, and the computer must restart. It includes nonsensical information.
Don't ignore that information. Instead, make a note of it. If you can, get on the Internet and Microsoft's site.
Enter that error message. You may well find it in Microsoft's knowledge base. If so, it can give you a good idea of what is wrong.
If you can't find the message, try on the Internet. Quite possibly, someone else has had the same problem. There may be a solution available there.
Many blue screens are caused by bad memory modules. First, uninstall and then reinstall the memory modules. If it still doesn't work, just replace the bad part. There are several memory companies online. Try Crucial, Kingston Technology and PNY Technologies. All have memory configurators. They'll tell you exactly what you need.
Memory is relatively inexpensive. And it's not too difficult to replace. You'll find tutorials at all the memory stores online. Just remember to ground yourself when you open your computer. You don't want to ruin your parts with static electricity.
5. Intruders are using your wireless network
Wireless is a great way to network. You can move around your house with your notebook. There's nothing better than working on your patio on a nice day.
Unfortunately, your neighbors will like your wireless system, too. It gives them the opportunity to access the Internet free. Maybe they'll download some kiddie porn and store it on your computer. You'll enjoy explaining that to the police!
You want to block your neighbors, and everyone else, from your system. You do that with encryption. That is set up within your router.
First, enter the IP (Internet Protocol) number in your browser. It will be something like 192.168.0.1. Check your router manual to be sure.
Once you sign in, you'll be able to select your encryption. You want WPA2, also known as WPA-PSK. You may also see WEP or WPA. WEP is Wired Equivalent Privacy, an old, unacceptable standard. WPA is a predecessor to WPA2. It has been broken, although it is much safer than WEP. Get more details about setting up wireless encryption.
If WPA-PSK or WPA2 is not available, check with the manufacturer. You may be able to upgrade the router's firmware. If not, buy a new router. They're not that expensive. Good encryption can save you money in the long run.
It's handy to be able to fix your own computer. Learn about some other problems that might pop up and how to resolve them.
- Getting a virus is never a good thing. However, there are viruses around that have been dubbed indestructible. Find out how to get rid of them.
- Sometimes computers get unstable for no reason. It could be a program you recently installed. Use this method to track down the culprit.
- Fixing a broken computer can be a hassle. Fortunately, you can take steps to prevent common breakdowns. Here are some ways to keep your computer in good health.
Wednesday, July 27, 2011
The 9 Skills Every Woman Should Master
DC Baseline Budget Definition
| | |
Paul N. Van de Water
Assistant Director for Budget Analysis
Congressional Budget Office
Budget Projections and Baselines
Task Force on Budget Process
Committee on the Budget
U.S. House of Representatives
| |
Mr. Chairman and Members of the task force, I appreciate the opportunity to be here this morning to discuss budget projections and budget baselines. In recent years, the Congressional Budget Office's (CBO's) baseline budget projections have been the most widely used yardstick for measuring budgetary proposals. When preparing a cost estimate of a bill, CBO and the Joint Committee on Taxation use baseline budget projections for calculating the cost or savings that would result from legislative proposals to change laws affecting entitlements and revenues. The Budget Committees generally use CBO's baseline budget projections as a starting point for formulating their recommendations for the annual Congressional budget resolution.
THE BASELINE CONCEPT
Twice a year--generally in January and August--CBO prepares baseline projections of federal revenues, outlays, and the surplus or deficit. Those projections are designed to show what would happen if current budgetary policies were continued as is--that is, they serve as a benchmark for assessing possible changes in policy. They are not forecasts of actual budget outcomes, since the Congress will undoubtedly enact legislation that will change revenues and outlays. Similarly, they are not intended to represent the appropriate or desirable levels of federal taxes and spending.
For tax revenues and entitlement programs, such as Social Security and unemployment insurance, CBO's baseline budget projections follow the rules set forth in section 257 of the Balanced Budget and Emergency Deficit Control Act of 1985. Current policies for those programs are defined by the laws that determine liability for taxes or eligibility for benefits. The baseline generally assumes a continuation of those laws as now on the statute books. It also assumes continuation of certain programs of limited duration that are routinely reauthorized.
For defense and nondefense discretionary programs, CBO's baseline budget projections assume that the Congress adheres to the statutory caps on budget authority and outlays through 2002. Once the caps expire, however, no overarching dollar total established in legislation will control discretionary appropriations. The concept of current policy for discretionary spending is therefore ambiguous after 2002. The benchmark established in the Deficit Control Act is the maintenance of real funding--that is, resource levels adjusted for inflation. The CBO baseline assumes that discretionary spending grows at the rate of inflation once the caps expire in 2002. An alternative is to fix the benchmark at a constant nominal (or dollar) level, and CBO publishes budget projections following that approach as well (see Table 1).
| TABLE 1. BASELINE BUDGET PROJECTIONS (By fiscal year, in billions of dollars) | ||||||||||||||
| 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | ||||
| | ||||||||||||||
| Baseline Projections with Inflation in Discretionary Programs After 2002 | ||||||||||||||
| Revenues | 1,680 | 1,738 | 1,784 | 1,847 | 1,930 | 2,008 | 2,105 | 2,208 | 2,314 | 2,426 | 2,540 | |||
| Outlays | ||||||||||||||
| Discretionary | 558 | 561 | 565 | 564 | 560 | 576 | 592 | 609 | 626 | 643 | 661 | |||
| Mandatory | ||||||||||||||
| Net interest | 245 | 247 | 243 | 237 | 230 | 226 | 221 | 215 | 209 | 202 | 194 | |||
| Other | 951 | 1,004 | 1,060 | 1,123 | 1,176 | 1,250 | 1,322 | 1,417 | 1,477 | 1,570 | 1,672 | |||
| Offsetting receipts | -82 | -82 | -85 | -91 | -103 | -97 | -101 | -107 | -113 | -119 | -126 | |||
| Total | 1,672 | 1,730 | 1,782 | 1,833 | 1,863 | 1,954 | 2,035 | 2,134 | 2,199 | 2,297 | 2,402 | |||
| Surplus | 8 | 9 | 1 | 13 | 67 | 53 | 70 | 75 | 115 | 130 | 138 | |||
| Baseline Projections Without Inflation in Discretionary Programs After 2002 | ||||||||||||||
| Revenues | 1,680 | 1,738 | 1,784 | 1,847 | 1,930 | 2,008 | 2,105 | 2,208 | 2,314 | 2,426 | 2,540 | |||
| Outlays | ||||||||||||||
| Discretionary | 558 | 561 | 565 | 564 | 560 | 560 | 560 | 560 | 560 | 560 | 560 | |||
| Mandatory | ||||||||||||||
| Net interest | 245 | 247 | 243 | 237 | 230 | 225 | 219 | 211 | 201 | 190 | 177 | |||
| Other | 951 | 1,004 | 1,060 | 1,123 | 1,176 | 1,250 | 1,322 | 1,417 | 1,477 | 1,570 | 1,672 | |||
| Offsetting receipts | -82 | -82 | -85 | -91 | -103 | -97 | -101 | -107 | -113 | -119 | -126 | |||
| Total | 1,672 | 1,730 | 1,782 | 1,833 | 1,863 | 1,938 | 2,001 | 2,081 | 2,126 | 2,202 | 2,284 | |||
| Surplus | 8 | 9 | 1 | 13 | 67 | 69 | 104 | 127 | 188 | 224 | 256 | |||
| | ||||||||||||||
| SOURCE: Congressional Budget Office. | ||||||||||||||
| NOTE: Caps on discretionary spending are set by law through 2002. The first scenario assumes that discretionary spending complies with the caps through 2002 and grows at the rate of inflation thereafter. The second assumes that discretionary spending complies with the caps through 2002 and is frozen thereafter. | ||||||||||||||
| | ||||||||||||||
The budget includes two other categories of spending: offsetting receipts, which encompass Medicare insurance premiums and similar fees and collections, and net interest, which basically reflects the government's interest payments on the national debt. CBO's baseline for offsetting receipts represents the agency's best estimate of the amount that the government will collect under current laws and policies. Net interest, rather than being directly controlled by policymakers, is driven by market interest rates and the outstanding stock of federal debt held by the public. As a result, CBO estimates such spending based on its projections of those two determinants.
Baseline budget projections depend critically on the economic and other estimating assumptions on which they are based. CBO typically illustrates the sensitivity of the budget to the economy in two different ways. One way is through rules of thumb that involve changes in individual economic variables taken in isolation. Another approach is to prepare complete alternative economic forecasts, such as one marked by a recession. In addition, budget projections depend on a host of factors that are not included in the economic forecast. For example, budget estimators must take account of the expected effect on future spending of such factors as birth rates, mortality, disability, and changes in the circumstances of individuals and families. They must also make assumptions about how individual taxpayers, beneficiaries, state and local governments, and providers of health care and other services respond to federal legislation.
A BRIEF HISTORY OF THE BASELINE
The genesis of baseline budget projections can be found in the Congressional Budget Act of 1974. That act required the Office of Management and Budget (OMB) to prepare projections of federal spending for the upcoming fiscal year based on a continuation of the existing level of governmental services. It also required the newly established Congressional Budget Office to prepare five-year projections of budget authority, outlays, revenues, and the surplus or deficit. OMB published its initial current-services budget projections in November 1974, and CBO's five-year projections first appeared in January 1976. Today's baseline budget projections are very much like those prepared more than two decades ago, although they now span 10 years instead of five.
The Budget Act was silent on whether to adjust estimates of discretionary appropriations for anticipated changes in inflation. Until 1980, OMB's projections excluded inflation adjustments for discretionary programs. CBO's projections, however, assumed that appropriations would keep pace with inflation, although CBO has also published projections without these so-called discretionary inflation adjustments.
CBO's budget projections took on added importance in 1980 and 1981, when they served as the baseline for computing spending reductions to be achieved in the budget reconciliation process. The reconciliation instructions contained in the fiscal year 1982 budget resolution (the so-called Gramm-Latta budget) required House and Senate committees to reduce outlays by a total of $36 billion below baseline levels, but each committee could determine how those savings were to be achieved. The CBO baseline has been used in every year since 1981 for developing budget resolutions and measuring compliance with reconciliation instructions.
The Deficit Control Act of 1985 provided the first legal definition of baseline. For the most part, the act defined the baseline in conformity with previous usage. If appropriations had not been enacted for the upcoming fiscal year, the baseline was to assume the previous year's level without any adjustment for inflation. In 1987, however, the Congress amended the definition of the baseline so that discretionary appropriations would be adjusted to keep pace with inflation. Other technical changes to the definition of the baseline were enacted in 1990, 1993, and 1997.
CURRENT ISSUES
Baseline budget projections increasingly became the subject of political debate and controversy during the late 1980s and early 1990s. Some critics contended that baseline projections create a bias in favor of spending by assuming that federal spending keeps pace with inflation, increases in caseloads, and other factors driving the growth of entitlement programs. Those critics also observed that entitlement spending continued to rise, even as eligibility rules were tightened and payment rates reduced. Changes that merely slowed the growth of federal spending programs, they argued, should not be described as cuts in spending.
Such criticisms seem to be directed more against the concept of entitlements, however, than against the idea of the baseline. After all, the baseline provides useful information about entitlement programs--a projection of what spending would be in the absence of Congressional action. It would be difficult to formulate legislation to control entitlement spending without an estimate of its likely growth under current law.
To aid in understanding the dynamics of the budget, CBO supplements its baseline projections with an analysis of the major causes of growth in entitlements and other mandatory spending (see Table 2). Mounting caseloads account for about one-fifth of the projected growth in entitlement programs over the next 10 years, and automatic increases in benefits account for more than one-third. More than one-quarter of the growth stems from increases in Medicare and Medicaid that cannot be attributed to rising caseloads or automatic adjustments in reimbursement rates.
| TABLE 2. SOURCES OF GROWTH IN MANDATORY SPENDING (By fiscal year, in billions of dollars) | |||||||||||||
| 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | ||||
| | |||||||||||||
| Estimated Spending for Base Year 1998 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | |||
| Sources of Growth | |||||||||||||
| Increases in caseloads | 12 | 24 | 38 | 52 | 66 | 81 | 99 | 118 | 138 | 161 | |||
| Automatic increases in benefits | |||||||||||||
| Cost-of-living adjustments | 9 | 22 | 37 | 52 | 68 | 84 | 101 | 118 | 136 | 154 | |||
| Othera | 4 | 9 | 16 | 23 | 35 | 47 | 60 | 73 | 88 | 103 | |||
| Other increases in benefits | |||||||||||||
| Increases in Medicare and Medicaidb | 16 | 28 | 45 | 64 | 82 | 104 | 127 | 151 | 176 | 202 | |||
| Growth in Social Securityc | 5 | 8 | 11 | 16 | 20 | 26 | 33 | 41 | 50 | 60 | |||
| Irregular number of benefit paymentsd | 0 | 0 | 5 | -5 | 0 | 0 | 15 | -9 | -6 | 0 | |||
| Change in outlays for deposit insurance | 1 | 2 | 3 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | |||
| Other sources of growth | 6 | 15 | 17 | 19 | 23 | 25 | 27 | 29 | 33 | 38 | |||
| Total | 53 | 109 | 172 | 224 | 298 | 371 | 465 | 526 | 619 | 721 | |||
| Projected Spending | 1,004 | 1,060 | 1,123 | 1,176 | 1,250 | 1,322 | 1,417 | 1,477 | 1,570 | 1,672 | |||
| | |||||||||||||
| SOURCE: Congressional Budget Office. | |||||||||||||
| a. Automatic increases in Food Stamp and child nutrition benefits, certain Medicare reimbursement rates, and the earned income tax credit under formulas specified by law. | |||||||||||||
| b. All growth not attributed to caseloads and automatic increases in reimbursement rates. | |||||||||||||
| c. All growth not attributed to caseloads and cost-of-living adjustments. | |||||||||||||
| d. Represents baseline differences attributable to variations in the number of benefit checks that will be issued in a fiscal year. Normally, benefit payments are made once a month. However, Medicare will pay 13 months of benefits in 2001 and 2005 and 11 in 2002 and 2006. Supplemental Security Income and veterans' benefits will be paid 13 times in 2005, 12 times in 2006, and 11 times in 2007. | |||||||||||||
| | |||||||||||||
From the beginning, the major issue surrounding the baseline has been whether to include inflation adjustments for discretionary programs. The existence of statutory caps on discretionary spending since 1991 has made this issue less acute, although the problem persists for years after the caps expire. Because this question has at least two possible answers, CBO prepares baseline projections using both approaches. Members of Congress and other users of budget data can select the alternative they prefer.
For the same reason, CBO includes additional information with the cost estimates that it prepares for bills. First, as required by rule XI of the House, CBO's cost estimates include, when practicable, a comparison of estimated funding levels for the relevant program (or programs) with the level of spending under current law. For mandatory programs, such as Medicare, that information allows the reader to identify changes in the rate of growth of a program as well as changes from the baseline (see Table 3). Second, in cases in which a bill does not specify the dollar amount of an authorization, CBO projects the level of spending both with and without adjustments for inflation (see Table 4). CBO's baseline projections of discretionary spending are not used in cost estimates of legislation. New authorizations of discretionary spending are compared with existing appropriations and authorizations (or zero if the program is not authorized in a particular year).
| TABLE 3. ESTIMATED BUDGETARY EFFECTS OF THE BALANCED BUDGET ACT ON MEDICARE (By fiscal year, in billions of dollars) | |||||||
| 1998 | 1999 | 2000 | 2001 | 2002 | |||
| | |||||||
| Spending Under Current Law | |||||||
| Benefit Paymentsa | 227.0 | 248.2 | 273.0 | 285.6 | 313.7 | ||
| Premiums | -21.4 | -22.4 | -23.4 | -24.5 | -25.6 | ||
| Total | 205.5 | 225.7 | 249.5 | 261.1 | 288.1 | ||
| Changes in Spending | |||||||
| Medicare Provisions (Subtitles A-G) | |||||||
| Benefit paymentsa | -6.9 | -15.5 | -27.6 | -17.1 | -35.9 | ||
| Premiums | 0.2 | -0.9 | -2.4 | -4.1 | -6.2 | ||
| Total | -6.7 | -16.4 | -30.0 | -21.2 | -42.1 | ||
| Medicaid and PACE Provisions (Subtitles H-I) | |||||||
| Benefit payments and low-income premium assistance | 0.7 | 0.8 | 0.9 | 1.0 | 1.1 | ||
| Spending Under the Balanced Budget Act | |||||||
| Benefit Payments and Low-Income Premium Assistancea | 220.7 | 233.4 | 246.3 | 269.5 | 278.9 | ||
| Premiums | -21.2 | -23.4 | -25.8 | -28.6 | -31.8 | ||
| Total | 199.5 | 210.0 | 220.4 | 241.0 | 247.1 | ||
| | |||||||
| SOURCE: Congressional Budget Office, Budgetary Implications of the Balanced Budget Act of 1997, CBO Memorandum (December 1997). | |||||||
| NOTE: PACE = Programs of All-Inclusive Care for the Elderly. | |||||||
| a. Includes mandatory administrative costs. | |||||||
| | |||||||
| TABLE 4. ILLUSTRATIVE COST ESTIMATE (By fiscal year, in millions of dollars) | |||||||
| 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | ||
| | |||||||
| Spending Under Current Law | |||||||
| Estimated Budget Authoritya | 167 | 0 | 0 | 0 | 0 | 0 | |
| Estimated Outlays | 231 | 240 | 55 | 8 | 0 | 0 | |
| Without Adjustment for Inflation | |||||||
| Proposed Changes | |||||||
| Estimated Authorization Level | 0 | 415 | 415 | 415 | 165 | 165 | |
| Estimated Outlays | 0 | 176 | 354 | 407 | 281 | 193 | |
| Spending Under S. 417 | |||||||
| Estimated Authorization Levela | 167 | 415 | 415 | 415 | 165 | 165 | |
| Estimated Outlays | 231 | 417 | 409 | 415 | 281 | 193 | |
| With Adjustment for Inflation | |||||||
| Proposed Changes | |||||||
| Estimated Authorization Level | 0 | 425 | 436 | 447 | 184 | 189 | |
| Estimated Outlays | 0 | 180 | 367 | 431 | 302 | 214 | |
| Spending Under S. 417 | |||||||
| Estimated Authorization Levela | 167 | 425 | 436 | 447 | 184 | 189 | |
| Estimated Outlays | 231 | 421 | 422 | 439 | 302 | 214 | |
| | |||||||
| SOURCE: Congressional Budget Office cost estimate for S. 417 as ordered reported by the Senate Committee on Energy and Natural Resources on May 21, 1997. | |||||||
| a. The 1997 level is the net amount appropriated for that year. | |||||||
| | |||||||
Other criticisms of the baseline are more political than technical in nat
DC Baseline Budget Definition
| | |
Paul N. Van de Water
Assistant Director for Budget Analysis
Congressional Budget Office
Budget Projections and Baselines
Task Force on Budget Process
Committee on the Budget
U.S. House of Representatives
| |
Mr. Chairman and Members of the task force, I appreciate the opportunity to be here this morning to discuss budget projections and budget baselines. In recent years, the Congressional Budget Office's (CBO's) baseline budget projections have been the most widely used yardstick for measuring budgetary proposals. When preparing a cost estimate of a bill, CBO and the Joint Committee on Taxation use baseline budget projections for calculating the cost or savings that would result from legislative proposals to change laws affecting entitlements and revenues. The Budget Committees generally use CBO's baseline budget projections as a starting point for formulating their recommendations for the annual Congressional budget resolution.
THE BASELINE CONCEPT
Twice a year--generally in January and August--CBO prepares baseline projections of federal revenues, outlays, and the surplus or deficit. Those projections are designed to show what would happen if current budgetary policies were continued as is--that is, they serve as a benchmark for assessing possible changes in policy. They are not forecasts of actual budget outcomes, since the Congress will undoubtedly enact legislation that will change revenues and outlays. Similarly, they are not intended to represent the appropriate or desirable levels of federal taxes and spending.
For tax revenues and entitlement programs, such as Social Security and unemployment insurance, CBO's baseline budget projections follow the rules set forth in section 257 of the Balanced Budget and Emergency Deficit Control Act of 1985. Current policies for those programs are defined by the laws that determine liability for taxes or eligibility for benefits. The baseline generally assumes a continuation of those laws as now on the statute books. It also assumes continuation of certain programs of limited duration that are routinely reauthorized.
For defense and nondefense discretionary programs, CBO's baseline budget projections assume that the Congress adheres to the statutory caps on budget authority and outlays through 2002. Once the caps expire, however, no overarching dollar total established in legislation will control discretionary appropriations. The concept of current policy for discretionary spending is therefore ambiguous after 2002. The benchmark established in the Deficit Control Act is the maintenance of real funding--that is, resource levels adjusted for inflation. The CBO baseline assumes that discretionary spending grows at the rate of inflation once the caps expire in 2002. An alternative is to fix the benchmark at a constant nominal (or dollar) level, and CBO publishes budget projections following that approach as well (see Table 1).
| TABLE 1. BASELINE BUDGET PROJECTIONS (By fiscal year, in billions of dollars) | ||||||||||||||
| 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | ||||
| | ||||||||||||||
| Baseline Projections with Inflation in Discretionary Programs After 2002 | ||||||||||||||
| Revenues | 1,680 | 1,738 | 1,784 | 1,847 | 1,930 | 2,008 | 2,105 | 2,208 | 2,314 | 2,426 | 2,540 | |||
| Outlays | ||||||||||||||
| Discretionary | 558 | 561 | 565 | 564 | 560 | 576 | 592 | 609 | 626 | 643 | 661 | |||
| Mandatory | ||||||||||||||
| Net interest | 245 | 247 | 243 | 237 | 230 | 226 | 221 | 215 | 209 | 202 | 194 | |||
| Other | 951 | 1,004 | 1,060 | 1,123 | 1,176 | 1,250 | 1,322 | 1,417 | 1,477 | 1,570 | 1,672 | |||
| Offsetting receipts | -82 | -82 | -85 | -91 | -103 | -97 | -101 | -107 | -113 | -119 | -126 | |||
| Total | 1,672 | 1,730 | 1,782 | 1,833 | 1,863 | 1,954 | 2,035 | 2,134 | 2,199 | 2,297 | 2,402 | |||
| Surplus | 8 | 9 | 1 | 13 | 67 | 53 | 70 | 75 | 115 | 130 | 138 | |||
| Baseline Projections Without Inflation in Discretionary Programs After 2002 | ||||||||||||||
| Revenues | 1,680 | 1,738 | 1,784 | 1,847 | 1,930 | 2,008 | 2,105 | 2,208 | 2,314 | 2,426 | 2,540 | |||
| Outlays | ||||||||||||||
| Discretionary | 558 | 561 | 565 | 564 | 560 | 560 | 560 | 560 | 560 | 560 | 560 | |||
| Mandatory | ||||||||||||||
| Net interest | 245 | 247 | 243 | 237 | 230 | 225 | 219 | 211 | 201 | 190 | 177 | |||
| Other | 951 | 1,004 | 1,060 | 1,123 | 1,176 | 1,250 | 1,322 | 1,417 | 1,477 | 1,570 | 1,672 | |||
| Offsetting receipts | -82 | -82 | -85 | -91 | -103 | -97 | -101 | -107 | -113 | -119 | -126 | |||
| Total | 1,672 | 1,730 | 1,782 | 1,833 | 1,863 | 1,938 | 2,001 | 2,081 | 2,126 | 2,202 | 2,284 | |||
| Surplus | 8 | 9 | 1 | 13 | 67 | 69 | 104 | 127 | 188 | 224 | 256 | |||
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| SOURCE: Congressional Budget Office. | ||||||||||||||
| NOTE: Caps on discretionary spending are set by law through 2002. The first scenario assumes that discretionary spending complies with the caps through 2002 and grows at the rate of inflation thereafter. The second assumes that discretionary spending complies with the caps through 2002 and is frozen thereafter. | ||||||||||||||
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The budget includes two other categories of spending: offsetting receipts, which encompass Medicare insurance premiums and similar fees and collections, and net interest, which basically reflects the government's interest payments on the national debt. CBO's baseline for offsetting receipts represents the agency's best estimate of the amount that the government will collect under current laws and policies. Net interest, rather than being directly controlled by policymakers, is driven by market interest rates and the outstanding stock of federal debt held by the public. As a result, CBO estimates such spending based on its projections of those two determinants.
Baseline budget projections depend critically on the economic and other estimating assumptions on which they are based. CBO typically illustrates the sensitivity of the budget to the economy in two different ways. One way is through rules of thumb that involve changes in individual economic variables taken in isolation. Another approach is to prepare complete alternative economic forecasts, such as one marked by a recession. In addition, budget projections depend on a host of factors that are not included in the economic forecast. For example, budget estimators must take account of the expected effect on future spending of such factors as birth rates, mortality, disability, and changes in the circumstances of individuals and families. They must also make assumptions about how individual taxpayers, beneficiaries, state and local governments, and providers of health care and other services respond to federal legislation.
A BRIEF HISTORY OF THE BASELINE
The genesis of baseline budget projections can be found in the Congressional Budget Act of 1974. That act required the Office of Management and Budget (OMB) to prepare projections of federal spending for the upcoming fiscal year based on a continuation of the existing level of governmental services. It also required the newly established Congressional Budget Office to prepare five-year projections of budget authority, outlays, revenues, and the surplus or deficit. OMB published its initial current-services budget projections in November 1974, and CBO's five-year projections first appeared in January 1976. Today's baseline budget projections are very much like those prepared more than two decades ago, although they now span 10 years instead of five.
The Budget Act was silent on whether to adjust estimates of discretionary appropriations for anticipated changes in inflation. Until 1980, OMB's projections excluded inflation adjustments for discretionary programs. CBO's projections, however, assumed that appropriations would keep pace with inflation, although CBO has also published projections without these so-called discretionary inflation adjustments.
CBO's budget projections took on added importance in 1980 and 1981, when they served as the baseline for computing spending reductions to be achieved in the budget reconciliation process. The reconciliation instructions contained in the fiscal year 1982 budget resolution (the so-called Gramm-Latta budget) required House and Senate committees to reduce outlays by a total of $36 billion below baseline levels, but each committee could determine how those savings were to be achieved. The CBO baseline has been used in every year since 1981 for developing budget resolutions and measuring compliance with reconciliation instructions.
The Deficit Control Act of 1985 provided the first legal definition of baseline. For the most part, the act defined the baseline in conformity with previous usage. If appropriations had not been enacted for the upcoming fiscal year, the baseline was to assume the previous year's level without any adjustment for inflation. In 1987, however, the Congress amended the definition of the baseline so that discretionary appropriations would be adjusted to keep pace with inflation. Other technical changes to the definition of the baseline were enacted in 1990, 1993, and 1997.
CURRENT ISSUES
Baseline budget projections increasingly became the subject of political debate and controversy during the late 1980s and early 1990s. Some critics contended that baseline projections create a bias in favor of spending by assuming that federal spending keeps pace with inflation, increases in caseloads, and other factors driving the growth of entitlement programs. Those critics also observed that entitlement spending continued to rise, even as eligibility rules were tightened and payment rates reduced. Changes that merely slowed the growth of federal spending programs, they argued, should not be described as cuts in spending.
Such criticisms seem to be directed more against the concept of entitlements, however, than against the idea of the baseline. After all, the baseline provides useful information about entitlement programs--a projection of what spending would be in the absence of Congressional action. It would be difficult to formulate legislation to control entitlement spending without an estimate of its likely growth under current law.
To aid in understanding the dynamics of the budget, CBO supplements its baseline projections with an analysis of the major causes of growth in entitlements and other mandatory spending (see Table 2). Mounting caseloads account for about one-fifth of the projected growth in entitlement programs over the next 10 years, and automatic increases in benefits account for more than one-third. More than one-quarter of the growth stems from increases in Medicare and Medicaid that cannot be attributed to rising caseloads or automatic adjustments in reimbursement rates.
| TABLE 2. SOURCES OF GROWTH IN MANDATORY SPENDING (By fiscal year, in billions of dollars) | |||||||||||||
| 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | ||||
| | |||||||||||||
| Estimated Spending for Base Year 1998 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | 951 | |||
| Sources of Growth | |||||||||||||
| Increases in caseloads | 12 | 24 | 38 | 52 | 66 | 81 | 99 | 118 | 138 | 161 | |||
| Automatic increases in benefits | |||||||||||||
| Cost-of-living adjustments | 9 | 22 | 37 | 52 | 68 | 84 | 101 | 118 | 136 | 154 | |||
| Othera | 4 | 9 | 16 | 23 | 35 | 47 | 60 | 73 | 88 | 103 | |||
| Other increases in benefits | |||||||||||||
| Increases in Medicare and Medicaidb | 16 | 28 | 45 | 64 | 82 | 104 | 127 | 151 | 176 | 202 | |||
| Growth in Social Securityc | 5 | 8 | 11 | 16 | 20 | 26 | 33 | 41 | 50 | 60 | |||
| Irregular number of benefit paymentsd | 0 | 0 | 5 | -5 | 0 | 0 | 15 | -9 | -6 | 0 | |||
| Change in outlays for deposit insurance | 1 | 2 | 3 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | |||
| Other sources of growth | 6 | 15 | 17 | 19 | 23 | 25 | 27 | 29 | 33 | 38 | |||
| Total | 53 | 109 | 172 | 224 | 298 | 371 | 465 | 526 | 619 | 721 | |||
| Projected Spending | 1,004 | 1,060 | 1,123 | 1,176 | 1,250 | 1,322 | 1,417 | 1,477 | 1,570 | 1,672 | |||
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| SOURCE: Congressional Budget Office. | |||||||||||||
| a. Automatic increases in Food Stamp and child nutrition benefits, certain Medicare reimbursement rates, and the earned income tax credit under formulas specified by law. | |||||||||||||
| b. All growth not attributed to caseloads and automatic increases in reimbursement rates. | |||||||||||||
| c. All growth not attributed to caseloads and cost-of-living adjustments. | |||||||||||||
| d. Represents baseline differences attributable to variations in the number of benefit checks that will be issued in a fiscal year. Normally, benefit payments are made once a month. However, Medicare will pay 13 months of benefits in 2001 and 2005 and 11 in 2002 and 2006. Supplemental Security Income and veterans' benefits will be paid 13 times in 2005, 12 times in 2006, and 11 times in 2007. | |||||||||||||
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From the beginning, the major issue surrounding the baseline has been whether to include inflation adjustments for discretionary programs. The existence of statutory caps on discretionary spending since 1991 has made this issue less acute, although the problem persists for years after the caps expire. Because this question has at least two possible answers, CBO prepares baseline projections using both approaches. Members of Congress and other users of budget data can select the alternative they prefer.
For the same reason, CBO includes additional information with the cost estimates that it prepares for bills. First, as required by rule XI of the House, CBO's cost estimates include, when practicable, a comparison of estimated funding levels for the relevant program (or programs) with the level of spending under current law. For mandatory programs, such as Medicare, that information allows the reader to identify changes in the rate of growth of a program as well as changes from the baseline (see Table 3). Second, in cases in which a bill does not specify the dollar amount of an authorization, CBO projects the level of spending both with and without adjustments for inflation (see Table 4). CBO's baseline projections of discretionary spending are not used in cost estimates of legislation. New authorizations of discretionary spending are compared with existing appropriations and authorizations (or zero if the program is not authorized in a particular year).
| TABLE 3. ESTIMATED BUDGETARY EFFECTS OF THE BALANCED BUDGET ACT ON MEDICARE (By fiscal year, in billions of dollars) | |||||||
| 1998 | 1999 | 2000 | 2001 | 2002 | |||
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| Spending Under Current Law | |||||||
| Benefit Paymentsa | 227.0 | 248.2 | 273.0 | 285.6 | 313.7 | ||
| Premiums | -21.4 | -22.4 | -23.4 | -24.5 | -25.6 | ||
| Total | 205.5 | 225.7 | 249.5 | 261.1 | 288.1 | ||
| Changes in Spending | |||||||
| Medicare Provisions (Subtitles A-G) | |||||||
| Benefit paymentsa | -6.9 | -15.5 | -27.6 | -17.1 | -35.9 | ||
| Premiums | 0.2 | -0.9 | -2.4 | -4.1 | -6.2 | ||
| Total | -6.7 | -16.4 | -30.0 | -21.2 | -42.1 | ||
| Medicaid and PACE Provisions (Subtitles H-I) | |||||||
| Benefit payments and low-income premium assistance | 0.7 | 0.8 | 0.9 | 1.0 | 1.1 | ||
| Spending Under the Balanced Budget Act | |||||||
| Benefit Payments and Low-Income Premium Assistancea | 220.7 | 233.4 | 246.3 | 269.5 | 278.9 | ||
| Premiums | -21.2 | -23.4 | -25.8 | -28.6 | -31.8 | ||
| Total | 199.5 | 210.0 | 220.4 | 241.0 | 247.1 | ||
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| SOURCE: Congressional Budget Office, Budgetary Implications of the Balanced Budget Act of 1997, CBO Memorandum (December 1997). | |||||||
| NOTE: PACE = Programs of All-Inclusive Care for the Elderly. | |||||||
| a. Includes mandatory administrative costs. | |||||||
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| TABLE 4. ILLUSTRATIVE COST ESTIMATE (By fiscal year, in millions of dollars) | |||||||
| 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | ||
| | |||||||
| Spending Under Current Law | |||||||
| Estimated Budget Authoritya | 167 | 0 | 0 | 0 | 0 | 0 | |
| Estimated Outlays | 231 | 240 | 55 | 8 | 0 | 0 | |
| Without Adjustment for Inflation | |||||||
| Proposed Changes | |||||||
| Estimated Authorization Level | 0 | 415 | 415 | 415 | 165 | 165 | |
| Estimated Outlays | 0 | 176 | 354 | 407 | 281 | 193 | |
| Spending Under S. 417 | |||||||
| Estimated Authorization Levela | 167 | 415 | 415 | 415 | 165 | 165 | |
| Estimated Outlays | 231 | 417 | 409 | 415 | 281 | 193 | |
| With Adjustment for Inflation | |||||||
| Proposed Changes | |||||||
| Estimated Authorization Level | 0 | 425 | 436 | 447 | 184 | 189 | |
| Estimated Outlays | 0 | 180 | 367 | 431 | 302 | 214 | |
| Spending Under S. 417 | |||||||
| Estimated Authorization Levela | 167 | 425 | 436 | 447 | 184 | 189 | |
| Estimated Outlays | 231 | 421 | 422 | 439 | 302 | 214 | |
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| SOURCE: Congressional Budget Office cost estimate for S. 417 as ordered reported by the Senate Committee on Energy and Natural Resources on May 21, 1997. | |||||||
| a. The 1997 level is the net amount appropriated for that year. | |||||||
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Other criticisms of the baseline are more political than technical in nat
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Tuesday, July 26, 2011
A Woman's New-found Moisturizer
I have been buying grape-seed oil at Costco for quite a while now – I love it for cooking as it has such a high smoke point. And now it’s my daily moisturizer too. A little goes a long way, and it doesn’t leave my skin feeling greasy or sticky at all; it soaks in within just a few minutes. It has a very neutral fragrance that pretty much disappears once it soaks in, and best of all, it works! No more dry skin.
Instead of buying a tiny little bottle labeled as a moisturizer, I just refill the one I have from my giant jug in the kitchen. Definitely my current favorite personal care product: inexpensive, easy to use, no greasy legs, and no questionable ingredients.