In The Face of Record Deficit, Recovery Will Take Time, Himes Says
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Norwalk Hour
Tait Militana
Boston University Washington News Service
Feb. 26, 2009
WASHINGTON – Connecticut residents should have modest expectations about the economic recovery, said Rep. Jim Himes, D-4, following the release of President Barack Obama’s preliminary budget outline Thursday morning, which charts the government’s spending for the next decade.
Himes said it is important for everybody to understand that it will take time for the current economic hardships to end and that residents need to work together to get through them.
“Confidence is critical, but it’s important for everybody to understand that we’re not coming out of this economic crisis tomorrow, next week or next month,” said Himes in an interview after the budget announcement. “This economic crisis was eight years in the making and will be more than one month in the undoing.”
Obama’s preliminary budget estimates a $1.75 trillion deficit for the rest of the fiscal year, which began in October, and $3.55 trillion in spending in 2010. It will increase taxes on families making more than $250,000 by allowing President George W. Bush’s tax cuts to expire and will introduce new tax cuts for the middle class.
According to 2007 census data, about 45,000 or 20 percent of families in Fairfield County make more than $200,000.
In a press conference Thursday morning, Obama said the budget is full of hard choices, but with the harsh economic realities it is important to focus on what is needed to move the economy forward.
“There are times where you can afford to redecorate your house and there are times where you need to focus on rebuilding its foundation,” said Obama. “Today we have to focus on foundations.”
Despite heavy spending and revenue shortfalls in the first few years of the budget, Obama predicted he would slash the deficit to $533 billion by 2013. It is estimated to balloon again in 2019 by more than $200 billion. Obama estimated savings in health care by cutting Medicare payments to private insurance plans and computerizing medical records. He also planned to close tax loopholes for businesses and end government payments to farms making more than $500,000.
Sen. Chris Dodd, D-Conn., said he is pleased with the outlines proposed by the president, especially reducing the high cost of health care.
“When it comes to health care reform, the president’s budget provides Congress a good starting point,” said Dodd. “To create a stronger, healthier nation in the long-term, I believe it will take an up-front investment in prevention and primary care, health information technology and expanding insurance coverage.”
Obama followed his call for energy investment in his congressional address Tuesday night, by allocating $15 billion a year for 10 years to develop wind and solar power technologies. Obama has asked Congress to take up a new energy bill by the spring recess.
“We need to make clean, renewable energy the profitable kind of energy,” he said.
Sen. Joe Lieberman, I-Conn., said in a statement that he considers defense spending a top priority in the coming years. In addition to the $69 billion already budgeted to fund the wars in Iraq and Afghanistan, the Obama administration has requested $75.5 billion for the rest of the year and $130 billion for 2010.
“I will fight to make sure that the Connecticut defense industry receives full support for the capabilities that only it can provide to our nation’s military,” Lieberman said.
Himes also set about fixing the country’s financial regulatory agencies Thursday, by announcing a set of broad guidelines for financial oversight reform in a press conference with the New Democrat Coalition. Himes, co-chair of the Task Force on Financial Services, called for a risk regulator to help prevent mass financial collapse and increased coordination between oversight bodies
He said the reforms are “complicated and technical and unsexy, but terribly important to the future of financial services industry and the strength of our economy.”
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