The March jobs report released this morning is not great news for the U.S. economy, or as New York Magazine’s Justin Roose writes it’s “more disappointing than Justin Timberlake’s new album.”
Although the unemployment rate dropped to 7.6 percent, there were only 88,000 jobs created in March, far less than the 190,000 that analysts had expected.
And while there were early concerns that the sequester cuts that took effect March 1 would negatively affect the numbers, the report shows the government actually added 5,000 jobs (excluding the struggling Postal Service.) The sector that surprisingly took a big hit last month was the retail industry, which lost 24,000 jobs likely linked to the payroll tax hike which took effect at the beginning of the year. - Read more at The Fiscal Times
OBAMA BUDGET CUTS MEDICARE, SOCIAL SECURITY
The president’s 2014 budget, set to be released next Wednesday, proposes significant cuts to Medicare and Social Security. It signals that the White House is trying to move closer to achieving a grand bargain with Republicans that would curb government borrowing and replace the sequester cuts that took effect last month.
Obama’s budget includes changing the cost-of –living calculation for Social Security in a way that would reduce benefits for beneficiaries, a proposal expected to please Republicans and upset liberal Democrats that don’t want to see any changes to Social Security. The president also proposes to generate new revenue by limiting how much wealthy individuals can accrue in their tax-deferred retirement accounts, by capping accounts at $3 million, which officials say is enough to finance a $205,000 a year income, The Washington Post’s Zachary A. Goldfarb reports. The president also proposes to fund new priorities including a program offering free pre-school to all four-year-olds from low-to moderate-income households, and an increase in tobacco taxes that would for early childhood education initiatives. - Read more at The Fiscal Times
CONGRESS READYING FOR DEBT CEILING SHOWDOWN When lawmakers return to Washington next week, they are expected to map out strategies for the upcoming fiscal battle over the debt ceiling. “While the appetite seems low for a massive showdown like the debt-ceiling fight of the summer of 2011, particularly as the Republican Party does some soul-searching on how to best present itself on fiscal and economic issues, House Republicans have continued their aggressive rhetoric. Extracting “dollar-for-dollar [spending cuts] is the plan,” House Speaker John Boehner told reporters just before recess,” National Journal’s Nancy Cook writes.
“Indeed, House Republicans are approaching the debt ceiling with a renewed measure of confidence….They managed to stay united during the fiscal battles of late--a sequence that moved with relative ease from the sequester, to the passage of the House Republican budget, to the approval of a continuing resolution to keep the government funded through the end of the fiscal year in September. The debt-ceiling debate, set to crescendo in July, is the final chapter in this act.” - Read more at National Journal
THE POLITICS OF SELF-SACRIFICE
“The rush started on Tuesday when the flush new defense secretary, Chuck Hagel, announced that he would give back a share of his salary for each day that Pentagon employees are furloughed. On Wednesday, President Obama jumped in with his own show of solidarity by pledging to return to the Treasury 5 percent of his $400,000 salary. By Thursday, the Obama administration’s stampede to embrace the politics of self-sacrifice was on. Cabinet secretaries practically tripped over themselves to hand over parts of their paychecks as federal workers brace for furloughs because of the across-the-board budget cuts known as the sequester,” The New York Times’ Jeremy Peters writes. Of course, they can easily afford it. The president and many of the cabinet members that have volunteered to take pay cuts, including Secretary of State John Kerry, Hagel, and Attorney General Eric Holder, are multi-millionaires. - Read more at The New York Times