The federal budget deficit was about $40 billion during the first quarter of fiscal year 2002, CBO estimates, a substantially larger shortfall than those recorded in fiscal years 2000 ($20 billion) and 2001 ($2 billion). The deficit would have been greater but for the shift of $23 billion in corporate income tax payments from September 2001 to October 2001.

The decline in revenues occurred because of continued weakness in corporate income tax receipts, which fell by $15 billion, or almost 30 percent, compared with their level last December. For each of the major quarterly payments made by corporations during calendar year 2001, receipts were substantially below the previous year's figure.

The government recorded a deficit of about $40 billion for the first three months of fiscal year 2002, CBO estimates--about $38 billion more than for the same period last year. Receipts were slightly higher than during the first quarter of last year, but outlays were about $40 billion higher. Adjusted for shifts in the timing of certain receipts and expenditures, the first-quarter deficit was the largest since fiscal year 1996.

Without two temporary factors that boosted receipts in the past three months, however, total receipts would have been lower than in the same quarter a year ago. First, corporations made $23 billion in estimated payments on October 1, 2001, instead of on the normal deadline of September 15, because firms were allowed the delay by EGTRRA. Without the timing shift, corporate receipts would have been down by about 40 percent in the first three months of fiscal year 2002. In addition, an extra business day in the quarter added about $5 billion to receipts. Without those two factors, total receipts would have fallen by about $26 billion, or more than 5 percent, in the first quarter of fiscal year 2002. Of that decline, roughly $5 billion resulted from the cuts in individual income taxes enacted in EGTRRA, and about $21 billion was caused by the recession--especially its effects on corporate profits--and other factors.

Commentary:
The Bush tax cut was based on never having a rainy day. Oops!

Tax Cuts (rep)

But households do not predictably spend a fixed proportion of the extra income left in their hands when taxes are reduced. Rather, a household's propensity to consume appears to vary with its income and depends on expectations within the household of what will happen to that income over the longer term.

The timing of fiscal stimulus is also important. If the additional spending it generates is slow in coming, then it will provide little help to the economy when a boost is needed. Moreover, if it is so delayed that it takes place after the economy is substantially improved, it can contribute to overexpansion and higher inflation.

In general, most of the tax cuts surveyed in this paper are unlikely to generate large increases in GDP in their first year. Indeed, the boost in GDP from even the most effective of the proposed tax cuts is unlikely to substantially exceed the amount of revenue lost.

REBATES: (dem)

These rebate proposals would have a moderate "bang for the buck"--that is, they would produce moderate stimulative effects relative to the total revenues lost over the lifetime of the provision.

Accelerating Rate Cuts (rep)

Because the cost extends through 2005, the first-year stimulus from advancing the reductions (although marginally larger than that from the other cuts) is purchased at a substantially higher total loss of revenues over the life of the provision.

Implementing a Sales Tax Holiday (rep)

The bang for the buck of this proposal is very uncertain. But the lag in implementation that would occur while states' legislatures took the necessary actions could not only push much of the stimulus beyond the first year but actually slow sales during the period in which consumers would be awaiting the holiday.

Repealing the Corporate Alternative Minimum Tax (rep)

Eliminating the corporate AMT may be useful in the long run as a permanent reform or as a way to ensure that the economy derives the fullest effects from other corporate tax cuts. But it does little by itself to change the near-term incentive for businesses to invest. Its bang for the buck is small because it is primarily a reduction in taxes on the return from capital that is already in place, not an incentive for new investment.

Proposals Related to the Treatment of Capital Gains

In general, little immediate fiscal stimulus would be provided by cutting capital gains tax rates or expanding capital loss provisions.

Changing the Treatment of Subpart F Income

The revenue loss that JCT estimated for the Senate version would total $1 billion--because it would be a one-year extension of the current treatment and have costs only in 2002 and 2003. H.R. 3529 would have a five-year cost of $7 billion and a 10-year cost of $8 billion.

Although the change in tax treatment would have virtually no effect on the cost of domestic investment, it would increase cash flow to the affected corporations--mostly large multinational firms that are less likely than most to be constrained to investing internally generated funds. Thus, altering the tax treatment of subpart F income--even if it was desirable for other, possibly long-term, reasons--would provide little stimulus (because it would primarily affect income from existing capital and foreign rather than domestic economic activity).

Commentary:
Why is Bush lying to us about his plan and why is the press letting him get away with it? We must conclude both don't care if his plan is the "right thing to do." Those who support the Bush/Republican Stimulus Plan must be removed from office in the next election.

WASHINGTON (Reuters) - President Bush on Wednesday allowed U.S. technology firms to sell high-speed computers to Russia, China, India and countries in the Middle East, easing a Cold War-era ban designed to halt the spread of nuclear arms.

Computer manufacturers may now export computers capable of complex three-dimensional modeling, calculating fluid dynamics, and other advanced applications to Pakistan, Vietnam and other so-called "Tier 3" countries without specific permission from the government.

The Bush Administration more than doubled the processor speed limit, from 85,000 Millions of Theoretical Operations Per Second, or MTOPS, to 195,000 MTOPS.

A typical U.S. home computer now sold in retail stores is capable of roughly 2,100 MTOPS. The limits on computing power come into play on more powerful workstations and so-called server computers used to manage organizations.

The restrictions were put in place in 1979 as part of a broader effort to limit the spread of nuclear weapons. Giving countries such as India and Pakistan advanced computing power would allow them to develop missiles and other weapons more easily, the reasoning went.

In recent years, the government had moved to ease export restrictions. The Clinton Administration boosted the MTOPS limit to 85,000 from 28,000 last January and the Senate passed a bill on Sept. 6 that effectively removed MTOPS limits.

Commentary:
In 1999, President Clinton put in place very tough safeguards so China wouldn't receive anything over 7,000 MTOPS ( 12,500 and 28,000 MTOPS in 2000) and he was criticized by conservatives. Now we wait to see if these same conservatives say anything about Bush's latest move.

"The debate on technology exports heated up with the release of a Congressional report two weeks ago which strongly criticized the Clinton Administration for allowing China to strengthen its nuclear arsenal through access to American technology, including computers."

Conservatives and the press (the same thing) blamed Clinton's campaign contributions from China for his decision to give China far weaker computers. What will the press say now about Bush? We wait!

If you have a brain and still think republicans or the press have integrity, forget it!

WASHINGTON (CNN) -- The Bush White House intends to sidestep the Democrat-controlled Senate and place two well-known conservatives in high-profile posts at the Labor and State Departments during the congressional recess, two senior administration officials told CNN on Friday.

President Bush has made no final decisions, but administration officials have said he may use recess appointments to place Otto Reich in the post of assistant secretary of state for Western Hemisphere affairs, and Eugene Scalia as Labor Department solicitor.

A recess appointment is a constitutional feature designed to resolve an impasse between the White House and Senate. Recess appointees can remain in their posts until the term of Congress expires.

Senior officials said Bush is due to receive a final memorandum recommending Reich, Scalia and other potential recess appointments after Christmas. A White House announcement on the appointments will come on or after January 3, officials said.

The president will also use his recess appointment powers to fill vacancies on the National Labor Relations Board and the Securities and Exchange Commission.

Scalia is the son of Associate Supreme Court Justice Antonin Scalia. Democrats say they oppose the younger Scalia because of his position on work-related injuries and other labor matters.

Comment: Can we say payoff?

Senate Majority Leader Tom Daschle, D-South Dakota, released a statement saying the White House criticism is unwarranted. The Senate has confirmed 28 federal judges in the six months of Democratic control this year, he said, and four more confirmations are on the calendar. He said none of Bush's court nominees were confirmed during the first six months of the year, when Republicans held power in the Senate.

"In fact, the 'vacancy crisis' is a creation of the Republicans who now bemoan it," Daschle's statement said. "The Republican-controlled Senate oversaw some of the lowest rates of confirmation in history."

Commentary:
The Constitution requires these appointee's to be approved by the US Senate.

On this day, Mr. Bush becomes eligible for articles of   impeachment and removal from office for violating article 2, section  2  of the Constitution.

"He shall have power, by and with the advice and consent of the Senate, to make treaties, provided two thirds of the Senators present concur; and he shall nominate, and by and with the advice and consent of the Senate, shall appoint ambassadors, other public ministers and consuls, judges of the Supreme Court, and all other officers of the United States..."

"The President shall have power to fill up all vacancies that may happen during the recess of the Senate, by granting commissions which shall expire at the end of their next session."

Since the vacancies did not happen "during the recess of the Senate", Bush has violated the Constitution and should be removed from office.

WASHINGTON -- Like the presidents who have preceded him, President Bush has circled 180 degrees on foreign policy, throwing out his campaign pledge to avoid "nation building" and entering full tilt in the creation of a new Afghanistan.

In 2000, Gov. George W. Bush told interventionists and isolationists alike that the Clinton administration had gone too far in intervening in the politics of other nations, stretching thin the military in regions that don't threaten U.S. national security interests.

The policy might have worked too, if it were not for the Sept. 11 terror attacks, which revealed to Bush that nation-building is still a favorable option in countries where threats to U.S. security are allowed to fester unchecked.

Afghanistan, where the nation's Taliban rulers were sheltering Usama bin Laden and his Al Qaeda terrorist network, is the first example. When that campaign ends, however, Bush promises to pursue terrorism — militarily, financially or diplomatically — to the far corners of the earth.

What he won't do, however, is lend the U.S. military to a peace-keeping effort, but with the pursuit of terrorism, many nations' security is threatened and the United States could again be put in the position of mopping up after a fallen government.

In any event, Bush's turnaround on foreign policy is not unique to his presidency.

In 1940, while the United States avoided the war in Europe, Franklin D. Roosevelt ran his campaign for a third-term on the premise of staying out of the conflict while lending assistance to Britain. Just a year after his election, however, the United States was pulled into the war after Japan attacked Pearl Harbor on Dec. 7, 1941.

In 1960, John F. Kennedy charged in his campaign against Richard M. Nixon that the Eisenhower administration, in which Nixon was vice president, had permitted a "missile gap" to evolve, giving the Soviet Union a critical security edge over the United States.

After Kennedy settled into the White House the notion of a missile gap and a program to bridge it vanished.

So did Nixon's "secret plan" to end the war in Vietnam, which he had used in his successful race for the presidency in 1968, capitalizing on widespread sentiment against the war.

The war went on for years after Nixon was elected, and if he ever had a secret plan to end the conflict, he never revealed it.

In his 1980 presidential campaign, Ronald Reagan attacked the process of arms control agreements with the Soviet Union. It was a position that reflected the suspicions of Reagan and other deeply conservative Republicans.

After he was elected, "trust, but verify," became the catch-phrase, and U.S.-Soviet relations improved with the process of nuclear weapons reductions accompanied by verification measures.

Barely a year into his presidency, Bush's views on foreign policy are only beginning to evolve.

The United States has gone from holding Russia at arms length to embracing it, all at the urging of Bush, who has made Russian President Vladimir Putin a go-to partner in international policy.

On the Middle East, Bush has already backed away once from a campaign pledge to move the U.S. Embassy in Israel from Tel Aviv to Jerusalem, bolstering Israel's claim to the city as its capital.

He has also moved from being a benevolent broker — nudging, rather than trying to force — Israel and the Arabs toward peace agreements to a hard-liner on Palestinian violence. He has agreed with Israeli Prime Minister Ariel Sharon that violence must be curbed before steps toward peace can be taken, and has avoided meeting Palestinian leader Yasser Arafat, demanding he dismantle terrorist groups that have attacked Israelis.

At the same time, Bush has endorsed statehood for the Palestinians.

Last month, Secretary of State Colin Powell delivered a speech in Louisville, Ky., that suggested a larger role for the Bush administration in peacemaking if the violence is brought down.

Powell said Israel was strangling peace hopes by constructing homes for Jews on the West Bank and in Gaza, and he called Israel an occupier of land that Powell said should be turned over to the Palestinians in exchange for peace and security.

Commentary:
Isn't it odd how Fox News finds a way around calling Bush a liar? Instead of breaking a promise or lying to us, he's just like Clinton. We'll never have to accuse these guys of being consistent.

Had this article been written during the Clinton years, you can bet there would have no historical perspective and lots of name-calling. Has Fox grown up? or is it kissing the butt of Bush? You decide. A broken promise used to have value in politics...today, at least in this article, it's a badge of courage (as long as a republican does it).

Crawford, Texas, Dec. 28 (Bloomberg) -- President George W. Bush said he'll use presidential authority to sidestep a rule requiring his administration to provide Congress with written notice of U.S. intelligence activities.

Bush made the announcement in signing the intelligence authorization act for fiscal year 2002, which includes an amendment stating that reports to Congress should "always be in written form."

Requiring written notice of planned U.S. intelligence activities may "impair foreign relations" and national security, Bush said in a statement. The law also increases the overall intelligence budget 7 percent.

The move follows a spat between the president and members of Congress over how much classified information he should provide Capitol Hill about U.S. military operations in Afghanistan. In October, Bush tried to limit access to such information to leaders of both parties and the chairmen of the congressional committees with jurisdiction over the military.

Bush sent Congress a memo laying out the restrictions after leaks from an intelligence briefing produced stories that said administration officials told members of Congress there was a "100 percent chance" of retaliatory terrorist strikes should the U.S. attack Afghanistan over the Sept. 11 terrorist assaults in New York and Washington.

After Senate Democratic Leader Tom Daschle and legislators of both parties argued that information-sharing is part of the process, Bush backed away from the restrictions on who would get intelligence briefings from the Defense and State departments.

Commentary:

On this day, Mr. Bush becomes eligible for articles of   impeachment and removal from office for violating the Constitution of the United States and legislation he signed into law.

When is a promise not a promise? It all depends on the meaning of the word "is." Bush promised to give the money back the donors but instead gives it to the republican party. Can we believe anything this man says? Nope!

Can we say joke?

Dec. 19 — The White House today defended the treatment of American Taliban fighter John Walker, saying he does not have the constitutional right to a lawyer while he is in military custody.

Lie. There is nothing in the Geneva Convention about not having a lawyer while in military custody.

Walker's parents and his hired attorney have demanded that he be allowed access to legal representation while being questioned about his involvement in the military conflict in Afghanistan. In a statement released Tuesday, James Brosnahan said the 20-year-old had been questioned for at least 16 days outside the presence of a lawyer and that he deserves the same Constitutional rights as any American citizen. But today, the White House said Walker does not have those same Constitutional rights because he is not being questioned by law enforcement officials yet.

Lie. Since Walker is still a US citizen he's entitled to all protections under the Constitution. If Bush believes he's not a citizen, he must do so by proving it in court first. The unconstitutional presidency continues.

"So long as he is in military custody and is not being questioned for law enforcement purposes he does not have the constitutional right to a lawyer," White House spokesman Scott McClellan said. "Under the Geneva Convention military authorities may question prisoners for information that is of military value in the conduct of the war without the presence of a lawyer."

Lie. Article 17 of the Convention says; "Every prisoner of war, when questioned on the subject, is bound to give only his surname, first names and rank, date of birth, and army, regimental, personal or serial number, or failing this, equivalent information."

Brosnahan also complained that, outside a dictated letter, Walker's parents have not been allowed to have access to their son. He repeated the family's plea to withhold judgment until all the facts are known.

"We still do not know what the facts are," Brosnahan said in Tuesday's statement. "All we've heard is speculation and rumor. No one from the outside, other than the Red Cross, has seen John. Whatever the accusations, John has Constitutional rights. Getting the facts, allowing an accused person to talk with his attorney, ensuring that our system operates fairly regardless of the allegation — that is what the Constitution was designed to protect."

Not a Simple Case

Walker is recuperating from a gunshot wound and cooperating with authorities on a ship in the Arabian Sea after U.S. officials decided to move him from a Marine base in southern Afghanistan last week. Authorities say he is giving them information, and they are particularly interested in what he may know about the failed prison revolt at Mazar-e-Sharif where CIA operative Johnny Michael Spann was killed.

While Walker has cooperated, U.S. officials have mulled his fate, trying to figure out what charges, if any, he may face. Congressional leaders have suggested he could be charged with treason, but White House officials say his case is not that simple.

U.S. officials have also hesitated in labeling Walker, refusing to call him a prisoner of war and preferring "battlefield detainee." However, the Pentagon says that Walker is receiving food, water, and medical attention and being treated like a prisoner of war.

Lie. There is no concept in the Geneva Convention called "battlefield detainee." Bush uses the Geneva Convention to deny him a right to a lawyer, then makes up a class called "battlefield detainee" to deny him rights under that same convention.

"He's being treated consistent with the Geneva protections for prisoners of war," said Deputy Secretary of Defense Paul Wolfowitz said Tuesday. "So he enjoys all the protections that would go with 'prisoner of war' status."

Lie: See Article 48 below.

U.S. government officials have indicated Walker may be coming back to the United States soon. Still, Walker's parents, Frank Lindh and Marilyn Walker, complain that they have repeatedly asked to government to help them gain access to their son.

Brosnahan said the only correspondence they have had with Walker is a Dec. 3 letter he dictated to a Red Cross worker they received last week. They say they had asked the Red Cross to forward a letter of their own to Walker on Dec. 4, but have learned that U.S. authorities have not yet allowed them to deliver it.

The US is violating Article 48 of the Convention; "Mail and parcels addressed to their former camp shall be forwarded to them without delay."

A Senate committee yesterday directed the Bush administration to turn over documents related to an air pollution policy under development, opening a new front in a growing power struggle between the executive and legislative branches.

In a letter to Environmental Protection Agency Administrator Christine Todd Whitman, Sen. James M. Jeffords (I-Vt.), chairman of the Environment and Public Works Committee, said he was "concerned about rumored changes to [regulatory policy] that might undermine its benefits." Jeffords, joined by five committee Democrats, told the EPA to provide "all documents analyzing or discussing the impacts on future emissions under the Clean Air Act that would result" from various changes.

At issue is the administration's soon-to-be-released policy regarding emissions from old coal-fired power plants that have been expanded. In a broader sense, it is the latest effort by Congress to prevent the administration from acting alone and without congressional oversight.

On Thursday, President Bush invoked executive privilege to prevent a House committee from having access to prosecutors' records from a decades-old mob case and the Clinton administration campaign-finance investigation. That provoked bipartisan objections, including a threat to take the administration to court from Rep. Dan Burton (R-Ind.), chairman of the Government Reform Committee, who said: "This is not a monarchy."

Also Thursday, Bush informed Russia that the United States would pull out of the 1972 Anti-Ballistic Missile Treaty, prompting protests from lawmakers who said they were not consulted. "Shutting Congress out of the decision-making process involving agreements among nations is a dangerous and corrosive course of action," said Sen. Robert C. Byrd (D-W.Va.), the Senate president pro tempore, who also objected to Bush's decision to reduce the U.S. nuclear arsenal without using the framework of the START treaties. "It effectively undermines the intent of the framers of our Constitution. Monarchs make treaties. American presidents propose treaties."

Congress is already in a dispute with the administration over energy and environmental policy. Vice President Cheney rejected a "demand letter" from Congress's General Accounting Office for materials related to the development of the administration's energy policy; a decision whether to proceed with legal action is on hold. Earlier, Sen. Joseph I. Lieberman (D-Conn.), chairman of the Governmental Affairs Committee, threatened to subpoena documents related to the administration's regulatory decisions; the White House allowed Lieberman's staff to view the documents.

Lieberman is also a signer of yesterday's letter from Jeffords. The subject is the "New Source Review," a provision of the Clean Air Act that requires utilities and other big polluters to install the latest technology if they expand older, coal-fired plants. Power producers had found ways to expand output without triggering the requirement to replace emissions technology, until the Clinton administration launched a series of lawsuits to crack down on compliance.

The Bush administration is reexamining the lawsuits and enforcement of the New Source Review, which industry opposes. Congressional officials say environmentalists in the administration, such as Whitman, favor a stringent regulation of new sources of emissions and propose combining the policy with new legislation restricting overall emissions of major pollutants. The congressional officials say others, such as Energy Secretary Spencer Abraham and Cheney, support more lenient requirements for industry and are not eager to proceed with legislation governing major pollutants.

Jeffords and the committee Democrats fear that the administration will seek to implement its new policy -- possibly one allowing emissions increases for power plants -- without consulting Congress or supporting broader pollutant legislation. "We have a right to know how the EPA is reaching a decision on how it is going to implement one of the most essential clean air programs," said a senior committee aide. "If we do this, it should be done in the context of the legislative process." An EPA spokesman, Joseph Martyak, said he had not yet seen the request. "We always try to work with the Congress and especially Chairman Jeffords," he said.

Commentary:
It's safe to say government of, by and for the people doesn't exist with Bush and Co. In their little world, the governed are too stupid to know or understand the truth, so they withhold it. Is democracy dead?