Memo for your review

Randy Forbes
2013-02-06 13:39:25
Send me an email | Forward to a Friend To: Citizens of Virginia’s Fourth District From: Congressman Randy Forbes Date: February 2013 Subject: The Next Four Months Virginia stands to be hit perhaps harder than any other state in our nation as a result of impending federal decisions. Significant job losses, lasting weaknesses in national defense, and serious economic harm will more than likely result from two sets of massive cuts to national security – first, $487 billion in defense cuts enacted in 2011 and second, $492 billion in defense sequestration cuts currently on course to take effect of March 1. I voted against these arbitrary cuts, and have consistently warned over the past two years that, combined, these decisions will most certainly jeopardize our military's ability to defend the nation and place the Commonwealth of Virginia in a dire economic situation. The Associated Press ran this article outlining the impacts of just the first set of cuts: GDP Shows Surprise Drop for US in Fourth Quarter Published: Wednesday, 30 Jan 2013 | 8:11 AM ET The U.S. economy posted a stunning drop of 0.1 percent in the fourth quarter, defying expectations for slow growth and possibly providing incentive for more Federal Reserve stimulus. The economy shrank from October through December for the first time since the recession ended, hurt by the biggest cut in defense spending in 40 years, fewer exports and sluggish growth in company stockpiles. The Commerce Department said Wednesday that the economy contracted at an annual rate of 0.1 percent in the fourth quarter. That's a sharp slowdown from the 3.1 percent growth rate in the July-September quarter. In addition to adequately providing for our national security, our nation faces coming challenges in passing a federal budget and addressing massive overspending. This memo seeks to educate and inform interested constituents on upcoming timelines and critical challenges. Each term or challenge is clearly defined and its current status laid out. The memo finishes with the actions I believe can begin to help America handle its out-of-control spending while preserving our national security. It is my hope that this memo cultivates serious and thoughtful dialogue regardless of party or persuasion. Yours in service, FISCAL TIMELINE March 1 Sequestration cuts go into effect March 27 Continuing Resolution expires; Congress must pass spending bill for remainder of fiscal year April 15 Deadline for House and Senate to pass budget resolutions for next fiscal year May 18 Borrowing authority expires; federal government again reaches its debt limit KEY TERMS & CHALLENGES Sequestration: $984 billion in automatic, largely across-the-board spending reductions composed of $492 billion from national security and $492 billion from programs such as education, law enforcement, Medicare, housing, and medical research. While these cuts will affect almost all federal government programs, there are some areas of government exempt from sequestration cuts including Social Security, Medicaid, Pell Grants, school lunch programs, and Department of Veterans’ Affairs programs. Sequestration cuts are in addition to the $487 billion in defense cuts enacted in 2011. Status: Originally scheduled to take effect at the beginning of the year, Congress passed a two-month delay of sequestration until March 1. Continuing Resolution (CR): Continuing resolutions are a tool used by Congress when the body fails to pass yearly spending bills to fund the government. Essentially, a CR ‘continues’ funding the government for some specified period of time at the last year’s rate. CRs can be highly disruptive for areas of our government such as the military in which a prior year’s funding level or funding allocation is often inconsistent with current needs. Status: In September of 2012, the President signed into law a 6-month continuing resolution funding the federal government through March 27. Congress must pass regular spending bills before March 27 or it will be forced to continue funding the government through another CR, causing significant disruptions in areas such as shipbuilding and national defense. Budget resolution: A budget resolution – or budget - represents a spending plan for the upcoming fiscal year and at least the following four fiscal years. When adopted by Congress, the budget resolution serves as an agreement between the House and Senate as to how it will very broadly allocate resources across the federal government. Status: While the House has passed yearly budgets, the Senate has failed to pass a budget for over 3 ½ years. Recently, the House and Senate passed the No Budget, No Pay Act, requiring Members of the House and Senate to pass a budget resolution by April 15th or have their pay withheld. Debt limit: The national debt ceiling is a level imposed by Congress on how much debt the U.S. can carry. Status: Under the 2011 Budget Control Act, the debt limit was set at $16.394 trillion, a ceiling that was reached at the beginning of this year. The House and Senate passed legislation to temporarily suspend the debt limit until May 18. Debt: The sum of all outstanding debt owed by the Federal Government. Status: The debt is currently $16.433 trillion, which is more than $52,000 for every American, more than $135,000 for every U.S. household, and greater than the size of our economy. Deficit: The budget deficit is when the government spends more than it receives in revenue. The deficit is the difference between the money the government takes in, called receipts, and what the government spends, called outlays, each year. Status: Deficits exceeded $1 trillion in each of the last four years. SUGGESTED ACTION Pass a Balanced Budget Amendment to constitutionally require that Congress spend no more than it takes in. Read more. Pass CAP Act to tie Member salaries to federal spending. The more Congress spends, the less they make. Read more. Stop defense sequestration cuts but promote efficiency by auditing the Department of Defense. Read more. Reform the tax code to achieve efficiency, simplicity, and clarity to taxpayers. Read more. Remove barriers to economic growth by reducing burdensome regulations. Read more. Reduce the size of government and end wasteful spending. Read more. Home | Contact | Forward to a Friend | Unsubscribe | Subscribe | Privacy | Office Locations Please do not reply to this message. This email address does not accept incoming messages. To send an email, click here.

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 To:  Citizens of Virginia’s Fourth District
 From:  Congressman Randy Forbes
 Date:  February 2013
 Subject:  The Next Four Months

Virginia stands to be hit perhaps harder than any other state in our nation as a result of impending federal decisions.  Significant job losses, lasting weaknesses in national defense, and serious economic harm will more than likely result from two sets of massive cuts to national security – first, $487 billion in defense cuts enacted in 2011 and second, $492 billion in defense sequestration cuts currently on course to take effect of March 1.  I voted against these arbitrary cuts, and have consistently warned over the past two years that, combined, these decisions will most certainly jeopardize our military's ability to defend the nation and place the Commonwealth of Virginia in a dire economic situation. The Associated Press ran this
    GDP Shows Surprise Drop for US in Fourth Quarter
    Published: Wednesday, 30 Jan 2013 | 8:11 AM ET

The U.S. economy posted a stunning drop of 0.1 percent in the fourth quarter, defying expectations for slow growth and possibly providing incentive for more Federal Reserve stimulus. The economy shrank from October through December for the first time since the recession ended, hurt by the biggest cut in defense spending in 40 years, fewer exports and sluggish growth in company stockpiles. The Commerce Department said Wednesday that the economy contracted at an annual rate of 0.1 percent in the fourth quarter. That's a sharp slowdown from the 3.1 percent growth rate in the July-September quarter.

In addition to adequately providing for our national security, our nation faces coming challenges in passing a federal budget and addressing massive overspending. This memo seeks to educate and inform interested constituents on upcoming timelines and critical challenges.  Each term or challenge is clearly defined and its current status laid out.  The memo finishes with the actions I believe can begin to help America handle its out-of-control spending while preserving our national security. It is my hope that this memo cultivates serious and thoughtful dialogue regardless of party or persuasion. 

Yours in service,


FISCAL TIMELINE

March 1   Sequestration cuts go into effect
March 27  Continuing Resolution expires; Congress must pass spending bill for remainder of fiscal year
April 15   Deadline for House and Senate to pass budget resolutions for next fiscal year
May 18    Borrowing authority expires; federal government again reaches its debt limit


KEY TERMS & CHALLENGES

Sequestration:  $984 billion in automatic, largely across-the-board spending reductions composed of $492 billion from national security and $492 billion from programs such as education, law enforcement, Medicare, housing, and medical research. While these cuts will affect almost all federal government programs, there are some areas of government exempt from sequestration cuts including Social Security, Medicaid, Pell Grants, school lunch programs, and Department of Veterans’ Affairs programs. Sequestration cuts are in addition to the $487 billion in defense cuts enacted in 2011. Status: Originally scheduled to take effect at the beginning of the year, Congress passed a two-month delay of sequestration until March 1.

Continuing Resolution (CR): Continuing resolutions are a tool used by Congress when the body fails to pass yearly spending bills to fund the government.  Essentially, a CR ‘continues’ funding the government for some specified period of time at the last year’s rate. CRs can be highly disruptive for areas of our government such as the military in which a prior year’s funding level or funding allocation is often inconsistent with current needs. Status: In September of 2012, the President signed into law a 6-month continuing resolution funding the federal government through March 27. Congress must pass regular spending bills before March 27 or it will be forced to continue funding the government through another CR, causing significant disruptions in areas such as shipbuilding and national defense.

Budget resolution:  A budget resolution – or budget - represents a spending plan for the upcoming fiscal year and at least the following four fiscal years. When adopted by Congress, the budget resolution serves as an agreement between the House and Senate as to how it will very broadly allocate resources across the federal government. Status:  While the House has passed yearly budgets, the Senate has failed to pass a budget for over 3 ½ years.  Recently, the House and Senate passed the No Budget, No Pay Act, requiring Members of the House and Senate to pass a budget resolution by April 15th or have their pay withheld.

Debt limit: The national debt ceiling is a level imposed by Congress on how much debt the U.S. can carry. Status: Under the 2011 Budget Control Act, the debt limit was set at $16.394 trillion, a ceiling that was reached at the beginning of this year.  The House and Senate passed legislation to temporarily suspend the debt limit until May 18. 

Debt: The sum of all outstanding debt owed by the Federal Government.  Status: The debt is currently $16.433 trillion, which is more than $52,000 for every American, more than $135,000 for every U.S. household, and greater than the size of our economy.

Deficit: The budget deficit is when the government spends more than it receives in revenue. The deficit is the difference between the money the government takes in, called receipts, and what the government spends, called outlays, each year.  Status: Deficits exceeded $1 trillion in each of the last four years.


SUGGESTED ACTION 

Pass a Balanced Budget Amendment to constitutionally require that Congress spend no more than it takes in. .

Pass CAP Act to tie Member salaries to federal spending.  The more Congress spends, the less they make. .

Stop defense sequestration cuts but promote efficiency by auditing the Department of Defense. .

Reform the tax code to achieve efficiency, simplicity, and clarity to taxpayers. .

Remove barriers to economic growth by reducing burdensome regulations.

Reduce the size of government and end wasteful spending. .

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Please do not reply to this message. This email address does not accept incoming messages. To send an email, click here.