Photograph by Marc Rochette/Bloomberg

A Canadian flag flies over the Berens River in Berens River, Manitoba.

Lawmakers are agreed: We should not invade Canada.

Debate over a Senate Democratic proposal to tap “unspent” Afghanistan war funds to cover the cost of halting budget sequestration veered today into the theoretical.

Sen. Dick Durbin of Illinois was on the floor, pushing his party’s plan to take advantage of an accounting quirk that forces the Congressional Budget Office to exaggerate how much the government probably will spend on the war in Afghanistan.

By law, the agency is required to assume that discretionary spending, including war funds, will grow each year with inflation even though costs should decline as the war in Afghanistan winds down. Democrats want to take the difference between what the war is projected to cost and what it will actually cost and use that to pay for offsetting automatic budget cuts for the rest of the fiscal year.

“There will be a surplus of money in this fund, some $600 billion, that otherwise had been anticipated to be spent,” Durbin said.

Republican Sen. Pat Toomey of Pennsylvania mocked the idea, saying the money was never going to be spent anyway so it can’t be counted as savings. He compared it with deciding not to invade Canada, and then counting as savings the money it would have spent marching on Ottawa.

“Imagine the money we could save if we don’t go to war with Canada,” Toomey said. “With all that savings, let’s go out and spend it.”

Durbin retorted that House Republicans had included Toomey’s “Canadian invasion fund” in one of their previous budgets. “So it was a good idea when (House Budget Chairman) Paul Ryan had to write a budget — it is a bad idea when we’re trying to avoid the pain of sequestration,” he said.

In case anyone missed Toomey’s sarcasm, he was careful to note he isn’t proposing to invade Canada, which came as some comfort to Vermont’s  Sen. Bernie Sanders.

“I live right near there,” Sanders said. “It would be a terrible thing.”

As first reported in Bloomberg Government’s Congress Tracker.

Original post is Canadian Invasion Not in the Budget by Political Capital.

Attorney General Eric Holder did just that today, using the 50th anniversary of Gideon Vs. Wainwright, the 1963 Supreme Court ruling that state courts are required to provide attorneys for defendants who cannot afford them in criminal cases, as a way to underline the devastation of the budget cuts that went into effect on March 1.

“Put simply, this department cannot afford to lose such a significant portion of its budget – particularly in a time of uncommon challenges, when many legal assistance organizations are facing shortfalls, and state and local officials have been asked to do more with less,” Holder said.

Holder’s remarks came as a rare panel of top officials — the attorney general, Supreme Court Justice Elena Kagan and former Vice President Walter Mondale — gathered in front of a standing-room only crowd in the Justice Department’s Great Hall to commemorate the ruling.

Sitting three floors above the event was the original handwritten letter that Clarence Earl Gideon, in pencil and on Florida prison stationery, personally mailed to the Supreme Court challenging his conviction for robbery — a guilty charge that came after Gideon was forced to defend himself because he lacked the money to hire a lawyer.

The event included a preview of a documentary about the case that premieres March 18, a film that prominently features Mondale, who as the young attorney general of Minnesota helped lead a group of his counterparts in other states in supporting Gideon in an amicus brief. The film is narrated by actor Martin Sheen.

All three participants said the case marked the beginning, not the end, of the ongoing fight to secure adequate legal services for the poor in the U.S. Each pressed for lawyers on both sides of the table — prosecutors and defenders — to donate time and money to increase access to legal counsel.

“We must never stop fighting to realize the principle that we have come to know by his name – by guaranteeing that every person in this country can access quality legal representation any time they come before the criminal justice system,” Holder said.

Original post is Landmark Ruling: Venue for Budget Talk by Political Capital.

Photograph by Melina Mara/The Washington Post via Getty Images

Elementary school kids pose for a picture in front of the White House on March 8, 2013. Their class had the last tour of the day.

In Washington, the time-honored threat of the impact of government budget cuts has centered on closing the Washington Monument.

The obelisk on the National Mall is already closed, however — thanks to repairs underway following the 2011 earthquake centered in Virginia. The 5.8 temblor loosened some stones.

So White House tours have taken the place of the monument closing.

When across-the-board budget cuts known as sequestration started taking effect March 1, the White House announced it would have to suspend the popular tours of 1600 Pennsylvania Avenue. They stopped March 9.

The tours are crowd-pleasers for the many visitors to the nation’s capital who obtain tickets through their congressmen and senators.

The Secret Service explained that it must furlough its forces — and overtime has been cut back for the people who guard the grounds and screen visitors.

“We have no White House tours right now, but they’ve got $250 million to give to Egypt?” Sen. Rand Paul of Kentucky asked, alluding to Secretary of State John Kerry’s recent announcement of the latest U.S. aid package for Cairo.

Rep. Louie Gohmert of Texas complained that, while the White House tours are suspended, the president’s golf tour goes on — the Republican proposed a budget amendment barring spending on the president’s golf outings.

Today, in an interview with ABC News’ George Stephanopoulos aired on “Good Morning America,” President Barack Obama said he’s looking for a solution.

Obama said he’s asked the Secret Service to find a way to let school groups tour the White House.

“What I’m asking them is, ‘Are there ways for us to accommodate school groups who may have traveled here?’” Obama said. “Can we make sure that kids potentially can still come to tour?”

The tours are big during Spring break.

Yet tours or no tours, the White House grounds will remain open for the Easter Egg Roll.

That’s on April 1. Really.

 Roger Runningen contributed to this report from the White House.

Original post is Obama Asks Secret Service to Let Schoolkids in for White House Tours by Political Capital.

Automatic spending cuts that will trim federal spending by $85 billion this year won’t result in layoffs at the U.S. Securities and Exchange Commission, the agency’s inspector general said today.

Carl W. Hoecker, the SEC’s inspector general, told a subpanel of the House Appropriations Committee that sequestration “would result in no furloughs or reductions in force” at the regulator. Hoecker told lawmakers his source for the information was the SEC’s chief financial officer.

Hoecker told the subcommittee that he didn’t know whether spending cuts would delay the timing of SEC regulations or other program work. The SEC’s 2013 budget would be cut about 5.2 percent, from $1.32 billion to $1.25 billion, under a House spending bill passed last week.

SEC spokesman John Nester said the spending cuts would slow hiring and limit staff travel and training and “the speed with which we can complete activities we are working on.”

Original post is Spending Cuts Won’t Cause SEC Layoffs, Watchdog Says by Political Capital.

Photograph by Mass Communication Specialist 2nd Class Corbin J. Shea/Navy Media Content Services via Bloomberg

Aviation ordnanceman practice color guard drills aboard the amphibious assault ship USS Kearsarge (LHD 3) in the Atlantic Ocean on Feb. 15, 2013.

The public apparently has little sympathy for complaints about the across-the-board cutting ordered in most discretionary federal spending.

The public is more concerned, a poll shows, about the cuts in Defense spending.

By a margin of 61 percent to 33 percent, people surveyed by ABC News and the Washington Post support the non-defense budget cutting that started Friday.

By a nearly identical margin, ABC reports, they oppose the cut in military spending.

The poll run by Langer Research Associates  found support for the non-defense cuts among Democrats (57 percent) and Republicans (75 percent) as well — while opposition to the defense cuts ran 73 percent among Republicans and split Democrats “down the middle.”

This would appear to place little pressure on Congress to restore much of the cuts as it writes a spending plan for the remainder of the fiscal year ending in September. Yet it would also tend to support a move in Washington to give the Pentagon more discretion over how the cuts are implemented, rather than requiring them across the board.

That work starts today in the House, with a March 27 deadline for writing a new budget.

Original post is Most Cuts OK, Not Defense: Poll by Political Capital.

Photograph by Matt Nager/Bloomberg

Law enforcement capture marijuana being smuggled into the United States from Mexico in Tucson, Arizona, in this file photo.

This is the art, in Washington, of cutting an agency that doesn’t exist:

In all the warnings of the consequences of looming budget cuts, the White House budget office  has noted one program targeted for cuts — an office that already is history.

The Office of Management and Budget, in a September 2012 report to Congress required by law, laid out “an estimate of the funding reductions that would be required across non-exempt accounts.” Included was an estimated 8.2 percent reduction to the $20 million budget of the National Drug Intelligence Center, a Justice Department agency based in Johnstown, Pennsylvania.

The NDIC was created to provide strategic drug-related intelligence and training assistance “in order to reduce the adverse effects of drug trafficking, drug abuse, and other drug-related criminal activity,” according to an archived Justice Department Web-site — archived because Justice shuttered the drug intelligence center in June 2012.

The magazine “Reason” first reported the closed agency’s inclusion in the report.

And there’s a reason, of course:

As required by law, an administration official says, the Sequestration Transparency Act report assumes that discretionary appropriations are funded at the level that would be provided under a continuing resolution (CR) at the same rate of operations as in fiscal year 2012. The president’s 2013 fiscal year budget did not request funding for the National Drug Intelligence Center, however, since the STA report assumes the government is operating under a CR, the STA report included the Center in its calculations.

Consider that $20 million already saved.

Original post is White House Budget-Cutting Lesson: Try Cutting 8.2 Percent from Zero by Political Capital.

Photograph by Andrew Harrer/Bloomberg

A shadow of the U.S. flag is seen on the Internal Revenue Service (IRS) building in Washington.

For all the budgetary horror stories surrounding the possible “sequestration” of federal defense and discretionary spending on March 1, there could be a hint of good news for tax cheats.

The Internal Revenue Service stands to lose $10 million from a fund it uses to pay informants, as part of the automatic chopping of $85 billion from the final seven months of the government’s fiscal year threatened next week.

Then again, the IRS whistle-blower program created by Congress in 2006 to boost federal tax revenue with rewards for tipsters dropping a dime on tax-evaders hasn’t been famous for its efficiency.

As Bloomberg News reported last year, “it’s become the place where allegations of tax avoidance go to die.”  Bloomberg reported in June that the IRS had received 1,300 claims against more than 10,000 companies since 2006, and issued three awards.

So it’s possible that $10 million less inefficiency won’t be missed.

 Jeff Kearns contributed.

Original post is IRS Whistle-Blowers Face Bounty Cuts by Political Capital.

Photograph by Rich Clement/Bloomberg

A memorial for the Sept. 11, 2001 attacks stands at the Pentagon in Arlington, Virginia.

That’s how much the Pentagon would face in cuts for the rest of the fiscal year if automatic spending cuts went into effect March 1.

The across-the-board cuts, known as sequestration, will “result in a serious erosion of readiness across the force,” Defense Secretary Leon Panetta said in a message yesterday to about 800,000 Department of Defense employees.

Bloomberg’s Tony Capaccio and Brendan McGarry have more here on Panetta’s message, in which the defense secretary said he notified Congress that furloughs could occur under sequestration.

Defense officials are also concerned that the cuts could affect the department’s ability to train alongside NATO allies, Bloomberg’s Gopal Ratnam reports.

Original post is Bloomberg by the Numbers: $46 Billion by Political Capital.

Photograph by Rich Clement/Bloomberg

A newly-renovated corridor leading to a ramp is seen at the Pentagon in Arlington, Virginia.

The “automatic, brutal” spending cuts in Defense and other sectors of discretionary federal spending set to take effect March 1 pose a threat to the nation’s economic recovery, President Barack Obama said today.

“Our top priority must be to do everything we can to grow the economy and create good, middle-class jobs,” the president said in an appearance at the White House complex. “That’s our North Star.”

“That’s why it’s so troubling that just 10 days from now, Congress might allow a series of automatic, severe budget cuts to take place that will do the exact opposite,” he said. “It won’t help the economy, won’t create jobs, will visit hardship on a whole lot of people.

“The whole design of these arbitrary cuts was to make them so unattractive and unappealing that Democrats and Republicans would actually get together and find a good compromise of sensible cuts as well as closing tax loopholes and so forth,” the president said. “This was all designed to say we can’t do these bad cuts — let’s do something smarter.  That was the whole point of this so-called sequestration.”

“Unfortunately, Congress didn’t compromise,” he said. “They haven’t come together and done their jobs, and so as a consequence, we’ve got these automatic, brutal spending cuts that are poised to happen next Friday.”

“If Congress allows this meat-cleaver approach to take place, it will jeopardize our military readiness. It will eviscerate job-creating investments in education and energy and medical research,” Obama said. “It won’t consider whether we’re cutting some bloated program that has outlived its usefulness, or a vital service that Americans depend on every single day.  It doesn’t make those distinctions.”

“These cuts are not smart.  They are not fair,” he said. “They will hurt our economy.  They will add hundreds of thousands of Americans to the unemployment rolls.  This is not an abstraction — people will lose their jobs.  The unemployment rate might tick up again.”

“And here’s the thing:  They don’t have to happen,” he said. “There is a smarter way to do this –- to reduce our deficits without harming our economy.  But Congress has to act in order for that to happen.”

The solution, he maintained, is a balanced approach to spending cuts and tax revenue increases — achieved with the repeal of tax exemptions.

That’s a tax balance in which the Republican-run House says it has no interest.

See the Senate Appropriations Committee’s accounting of the impact of that sequestration here.
 

Original post is Obama: ‘Brutal’ Budget Cuts March 1 Threaten Economic Recovery by Political Capital.

At a fundraising concert in San Francisco last night, President Barack Obama was still having fun with Republican Mitt Romney’s call in last week’s televised debate to cut funding for the Public Broadcasting Service, saying: “Elmo has been seen in a white Suburban.”

The California audience roared at what sounded like an allusion to the televised scene of O.J. Simpson’s famous slow-speed police chase in what was actually a white Bronco.

Obama also chided Romney with a Wizard of Oz reference to his rival’s $5 trillion tax cut plan, noting that Romney was trying to pretend it didn’t cost that much. “Don’t pay any attention to that tax cut behind the curtain,” Obama said.

Now Obama, who has made several references to Romney’s war on Sesame Street since their first debate, is airing a TV ad with a cameo appearance by Big Bird. The cable-targeted ad starts tomorrow in the run of comedy shows.

The Obama campaign ad opens with Bernie Madoff and Ken Lay, “criminals… gluttons of greed.” And who is the “evil genius towering over them?” the ad asks. “One man has the guts to say so:” Romney, repeating the name Big Bird, Big Bird. Then comes the Sesame Street icon: “Big, yellow, a menace to our economy.”

Mitt Romney knows — the cartoonish ad says — “it’s not Wall Street you have to worry about. It’s Sesame Street.”

The Romney campaign slammed the ad as trivial and accused Obama of missing the big economic picture.

“I just find it troubling that the president’s message, the president’s focus 28 days from Election Day is Big Bird,” Romney campaign spokesman Kevin Madden told reporters aboard Romney’s campaign plane this morning. “The governor is going to focus acutely on jobs and the economy and what we can do to create a better more prosperous future.”

And the folks responsible for Big Bird, Elmo and company are asking Obama to take down that ad.

“Sesame Workshop is a nonpartisan, nonprofit organization and we do not endorse candidates or participate in political campaigns,” the workshop says in a statement “from the neighborhood” at its Web-site. “We have approved no campaign ads, and as is our general practice, have requested that the ad be taken down.”

The Obama campaign explained in a statement that, “while President Obama passed historic Wall Street reform to hold big banks accountable and give consumers tools to make informed decisions for themselves, his opponent, Mitt Romney, has shown true conviction by vowing to take down Big Bird and keep Sesame Street under control.”

“You would need to cut PBS more than 1,000 times to fill the hole in Romney’s budget promise,”  campaign deputy press secretary Adam Fetcher says.

(All of this stems from the debate in Denver at which the moderator asked Romney about cutting the federal deficit. He said he’s start by repealing “Obama-care,” and he would cut federal funding for PBS — telling moderator Jim Lehrer of PBS: “I love Big Bird… actually like you, too.” The annual deficit is about $1.3 trillion. The federal subsidy for PBS is about $450 million a year.)

Bloomberg’s Lisa Lerer contributed to this report. 

Original post is Big Bird vs. Bernie Madoff: Sesame Street vs. Wall Street by Political Capital.