Here is our latest installment of the Daily Austerity Watch, 24/7 Wall St.’s summary of the major news of efforts by governments to bring their fiscal houses in order.
US Government – Washington pundits seem to think that a government shutdown is as sure of a thing in Washington, D.C., as the sun rising over the Potomac River or the blooming of the cherry blossoms. As the April 8 deadline nears, there is a chasm between the Republicans and Democrats that runs deep and wide. Ezra Klein of The Washington Post, for one, is deeply pessimistic.
…. the negotiations have become too acrimonious, the issues at their heart too numerous and personal to the parties, to make a deal likely even in normal circumstances. But in circumstances in which newly elected Republicans are trying to prove to their base that they won’t catch Beltway fever and compromise while Democrats are trying to prove they won’t get pushed around by a party that controls a minority of the federal government? A deal seems near impossible.
Vice President Joe Biden may be the wild card in these talks. Despite his penchant for gaffes, the former U.S. senator from Delaware is one of the savviest operators in Capitol Hill. That being the case, Politico notes that Biden has thus far been conspicuous by his absence in the debate. He has not been seen since an initial March 4 meeting, making Republicans suspicious that the White House isn’t serious about a reaching a budget deal, the web site says. Of course, the White House rejects this notion. According to the Democrats, talks have stalled because the Republicans have refused to compromise over their party’s plan to cut $61 billion in the remaining six months because they were afraid of offending members of the Tea Party.
Portugal: The Bank of Portugal today warned the government of the debt-laden European country not to slack off on its austerity measures. The report comes less than a week after Prime Minister Jose Socrates resigned after failing to get support for an austerity plan. Early elections are expected to be called, which may set the stage for an eventual default. Little wonder that the Bank is worried that the government may miss its economic goals this yerar and that the economy will worsen next year, as Reuters notes.
“The Portuguese economy is not set to accompany the economic recovery in Europe, although it should benefit from external demand,” the news service quotes the bank’s report as saying.
New York: The fallout from yesterday’s $132.5 billion state budget deal continues. New York Mayor Michael Bloomberg denounced Gov. Andrew Cuomo’s spending plan for creating an unfair fiscal burden on New Yorkers. He even used the word “outrage.” Others were fuming as well. The state’s top judge, Chief Judge Jonathan Lippman, is quoted as saying that the proposed cuts of $170 million will ” have a tremendous impact on the system.” Cuomo’s decision to let the state’s millionaires’ tax lapse has outraged advocates for education.
“Nobody who cares about students is celebrating this budget. Make no mistake about it: this budget will reduce the quality of education in New York,” says Billy Easton, Executive Director, Alliance for Quality Education in a press release
Missouri — Debate has begun on a $23 billion state spending plan for next year in the Missouri House. There are fewer fireworks than in other states because the Democrats agree that there is not much money to fight over, according to St. Louis Public Radio.
“That gap is estimated to be around $300 million,” its website says. ” Still, some lawmakers argued that this year’s round of cuts will be very painful.”