America's trillion dollar question
The US economy has suffered a sharp nosedive. Plunging exports and the biggest fall in consumer spending in 28 years has meant that the decline was much worse than analysts had expected. Kevin Connolly in the US looks at why we are now talking trillions as well as billions.
In the world of American government, the trillion is the new billion.
There was a time when only astro-physicists and accountants practising in Zimbabwe had any use for a word which means a million millions.
Barack Obama is not the only extraordinary phenomenon to rise to prominence in this country in the last year or so - the trillion is right up with him. Suddenly it is popping up in newspaper headlines with extraordinary frequency, even though it is surely a number so far beyond our everyday conceptual grasp that it conveys practically nothing.
America's budget deficit for example - the amount by which what the government spends exceeds what it earns - is now $1.75tn, and its national debt - the total of those deficits accumulating from year to year - is nudging $11tn.
If it helps to view it as a figure then here is America's annual budget deficit as it stands now: $1,750,000,000,000. And the national debt: $11,000,000,000,000.
Does that help? No, I rather thought it would not.
Is a "Billion Dollars" a Meaningful Number ?
What can you do with one oz of gold? How about $1000 in cash?
White House Poised for Budget Fight
By BRIAN KNOWLTON
Published: March 1, 2009
WASHINGTON " The Obama administration this weekend pursued a vigorous offensive to sell its economic program, counterattacking strongly against Republicans who call the new budget plan “mind-boggling” in its numbers and ambition.
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In his weekly radio talk on Saturday, President Barack Obama had called for the passage of a plan that would invest heavily in expanded health care, cleaner energy and education, but do so partly through taxes affecting the wealthy and polluters. He predicted fierce opposition from the insurance industry, oil and gas companies, student lenders and banks, saying: “I know they’re gearing up for a fight as we speak. My message to them is this: So am I.”
On Sunday, top White House advisers amplified on those comments, defending the breadth of the $3.6 trillion budget plan and sharply rejecting Republican arguments that it would cost, not create, jobs, and send energy costs up.
Rahm Emanuel, the White House chief of staff, said he was confident the budget would be passed by April, though he accused Republicans of “scare tactics” in trying to arouse public opposition. Mr. Emanuel, speaking on CBS’s “Face the Nation,” said that it was time for the country to move away from “a culture of rising deficits and more and more consumer spending,” and toward one that invests and saves.
Peter Orszag, the White House budget director, said it was wrong to suggest, as Republicans have, that the administration would be raising taxes at a time of deep recession, because those measures would take effect only in 2011, when the administration presumes the economy will be growing. “We face big problems and we’ve got to tackle them,” he said on ABC’s “This Week With George Stephanopoulos.”
At the same time, Mr. Emanuel and Mr. Orszag indicated that the president would not pick a fight over the estimated 9,000 “earmarks,” or special provisions inserted by individual lawmakers, in the omnibus spending bill passed last week.
Mr. Obama had frequently voiced his distaste for such costly provisions.
But Mr. Orszag indicated that the president would sign the legislation, needed to keep this year’s governmental programs running for the next several months. “This is last year’s business,” he said. “We just need to move on.”
A major legislative fight over the budget is certain. Republicans expressed shock at the size and radical change implied by some White House proposals, even if some conservatives appeared to quietly relish the issue as a rallying point useful as they try to begin their political recovery.
“I think it’s terrifying in the policy implications as well as mind-boggling in the numbers,” Senator Jon Kyl, Republican of Arizona and a Finance Committee member, said on “Fox News Sunday.” “You’re directly punishing job creation with this kind of huge tax policy.”
Representative Paul Ryan, a Wisconsin Republican, called the $3.6 trillion budget proposal “breathtaking.”
“What surprises me most about this budget is that they would bring it out in the middle of a recession,” said Mr. Ryan, who serves on both the Budget and Ways and Means Committees. The proposed fee for manufacturers who pollute would amount to an energy tax on all Americans, he said on Fox.
But Senators Kyl and Ryan said it would be difficult for Republicans to block the budget.
“I hope that we can, but that means that all of us will have to be together on this,” Kyl said. “We have to be absolutely united.”
This would be especially true if the majority Democrats employed a parliamentary maneuver that would require only 51 votes in the Senate for passage of budget legislation, not the usual 60.
Democrats control 58 seats in that chamber. Republicans’ best hope is that some conservative Democrats " uneasy over cuts in agricultural subsidies, or a drop in the amount the wealthy can deduct for charitable contributions " might join them.
“You can’t stop this in the House,” Mr. Ryan said. “If you can get a few Democrats to turn then I think you can slow this thing down.”
Mr. Emanuel said on Sunday that the Obama administration wanted to “continue to reach out” to Republicans, even though only three congressional Republicans supported the White House stimulus plan. But when asked on “Face the Nation” who now speaks for the Republican Party, he offered a view that might surprise many mainstream Republicans.
“It was Rush Limbaugh,” he said, referring to the conservative talk-show host who has said he hopes that Mr. Obama fails as president. “He is the voice and the intellectual force and energy behind the Republican Party. And he has been upfront about what he views.”