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Debt

WNYC News

Why S&P's Downgrade Of The U.S. Credit Rating May Not Be As Bad As It Sounds

Friday, August 05, 2011

Most of the big holders of U.S. debt don't pay much attention to rating agencies. Still, "downgrade" does have a nasty ring to it.

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The Takeaway

Despite Debt Deal, Economic Outlook Remains Bleak

Wednesday, August 03, 2011

Despite Congress finally passing a debt deal and President Obama signing off on the plan yesterday, the national mood was not celebratory. It's been a bad week for the economy, and it appears that it will only get worse. Last Friday, G.D.P. data showed disappointing economic activity in the nation's second quarter, and this week the Commerce Department released a report showing consumer spending fell in June. New employment figures, the economic indicator used to gauge growth, will be released Friday, and many are expecting them to be dismal.

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The Takeaway

Defense Budget Could Take $1 Trillion Hit

Wednesday, August 03, 2011

The debt deal President Obama signed into law yesterday may bring about the end of years of huge Pentagon budgets. The Pentagon will need to slash $350 billion from the defense budget over the next decade, and that number could potentially increase to $600 billion. If the joint bipartisan committee created under the debt plan fails to reach an agreement on future spending cuts, a "trigger" mechanism will force across-the-board cuts of $1.2 trillion over the next decade. While supporters say this is these cuts are overdue, critics and defense hawks argue they will undermine national security.

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The Takeaway

The Political Cost of the Debt Deal

Tuesday, August 02, 2011

With the debt deal in place, our Washington correspondent Todd Zwillich looks to what the political costs may be — and what groups have been pitted against each other for 2012. (Troops vs. Medicare? Wealthy Americans vs. Troops?) How will this debate play out for the Republican presidential candidates? Plus, what will we see before 2012, when the next deficit reduction package has to pass in the fall of this year?

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The Takeaway

How US Cities are Reacting to the Debt Crisis

Monday, August 01, 2011

The nation's debt crisis has all eyes on the politicians on Capitol Hill. But we wanted to know how the debt crisis is playing out in different cities across the country — what local fears and concerns are, and what people have to say about what's happening in the District of Columbia. We headed to Denver, Colo., Detroit, Mich., and Miami, Fla. to hear what people have to say about the current debt crisis.

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It's A Free Country ®

Read the Debt Ceiling Bill and Watch Obama on Compromise

Monday, August 01, 2011

The Senate is expected to take up the agreement reached between President Obama and Congressional leaders on Monday, follwed by the House. The compromise, which raises the debt ceiling and promises more than $2 trillion in spending cuts, was reached late on Sunday. Read the text of the bill under lawmakers' consideration and watch a statement by President Obama on the debt agreement.

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The Takeaway

The Long-Term Political and Economic Impact of the Debt Ceiling Drama

Monday, August 01, 2011

As Congress arrives at a budget agreement and avoids sending the U.S into default right before the August 2 deadline, we're examining the broader, long-term political and historical impact of the the debt crisis. How will it affect the credibility of the U.S. government? What does it tell us about President Obama, and how will the crisis shape next year's election?

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The Takeaway

This Week's Agenda: Crunch Time in Washington

Monday, August 01, 2011

The August 2 deadline for Congress to agree on a budget deal and avoid defaulting is looming uncomfortably close. Last night, President Obama and Senate Majority leader Harry Reid said tonight that congressional leaders of both parties have agreed on a plan to lift the debt ceiling. They will present the plan to their caucuses this morning, and hope for the measure to pass through votes by both the House and Senate, in order to avoid a U.S. default by August 2.

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WNYC News

Trying to Plug Big Budget Gap, MTA Asks City to Pay for 2nd Avenue Subway

Saturday, July 30, 2011

WNYC

The MTA said the city pay should pay it half a billion dollars for building the Second Avenue Subway since, the authority claims, the city stands to gain a big boost in tax revenues as property values go up around the subway after its planned opening in 2016.

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Transportation Nation

NY MTA, Desperate To Plug Big Budget Gap, Asks City To Pay For 2nd Ave Subway

Friday, July 29, 2011

The 8.5 mile length of a fully constructed Second Avenue Subway. Phase 1, now under construction, will go from E 96th to E 63rd Streets.

(New York, NY - WNYC) The NY Metropolitan Transportation Authority says the city should pay it half a billion dollars for building the Second Avenue Subway. It's only fair, the NY MTA reasons, when the city stands to gain a big boost in tax revenues as property values go up around the subway after its planned opening in 2016.

The proposal is one of nine different sources of funding the authority is counting on to plug a $9 billion gap in its $13.5 billion capital construction plan covering 2012-2015.

But Mayor Michael Bloomberg sounded unconvinced when asked on his weekly radio show about the NY MTA's idea for revenue-sharing. "Let me check," the mayor said sardonically. "I'll call our finance director and see if taxes came in yesterday."

Bloomberg said he preferred having the authority plug its budget gap with new revenue, like tolls on the East River Bridges. But that idea was most recently defeated by the New York State legislature in 2009. "We should find some ways to raise money for the MTA," the mayor added. "Something that would encourage people to take mass transit so there'd be more fare payers."

But NY MTA Chief Financial Officer Robert Foran said Albany "has no appetite for new dedicated taxes or fees."

As a result, the bulk of the NY MTA's strategy for funding the capital construction plan is to float new bonds worth $4.7 billion and obtain a low-interest federal loan for $2.2 billion. The plan has not pleased transit watchers.

The Citizens Budget Commission, a watchdog group, said it was "better than doing nothing to meet the essential infrastructure needs of mass transit. But it has a critical flaw – it proposes to borrow billions without presenting a corresponding plan for new revenues to match the increased long-run debt service burden."

Gene Russianoff of the Straphangers Campaign told WNYC that it's likely the borrowed money, plus interest, will be obtained down the road from the fare box. "I have sympathy for the MTA because it's not getting help from Albany or City Hall," he said. "But then it's turning to the riders and saying, 'Well, we'll see how this goes. There's a good chance your fares going to balloon down the road.'"

The NY MTA's capital construction plan will run out of money at the end of the year. Should the authority's funding plan not yield the billions expected of it, work on mega-projects like the Second Avenue Subway and a tunnel bringing Long Island Railroad trains into Grand Central Terminal could start to slow down by next year and, eventually, grind to a halt.

That doesn't even take into account the budgetary havoc to be wrought should some state lawmakers come through on their threat to eliminate the payroll mobility tax, which is expected to yield $1.2 billion for the NY MTA in 2012 alone. On Monday, Foran told a briefing for reporters on the budget that, "if we lose that tax, we have a big hole that we can't overcome."

And another thing. Balancing the NY MTA's budget also depends on saving $1.2 billion by convincing labor unions to agree to work three years in a row, beginning next year, without pay raises. John Samuelson, president of the 38,000 members of the Transport Workers Union, has said he’ll fight such a deal.

Foran said the NY MTA is doing its part by finding $2 billion in savings through cost-cutting measures like revamping an employee health plan, consolidating 34 data centers into three and eliminating 3,000 agency cell phones. He said funding must be found because the NY MTA's capital projects create 25 percent of all construction jobs in the metropolitan area, and are crucial to improving New York's subway and bus system.

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The Takeaway

How Will the Debt Ceiling Affect Our Personal Finances?

Thursday, July 28, 2011

We’ve been told repeatedly over the past several months that if the government fails to raise the debt ceiling by August 2, there could be dire consequences for the world economy. But many Americans are wondering: what does this have to do with us and our personal finances? If the government defaults on its debt, how will it affect our personal debt and investments?

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The Takeaway

Contingency Plans Underway As Debt Deadline Nears

Wednesday, July 27, 2011

Despite plenty of drama and public rhetoric in the battle over the U.S. debt ceiling, President Obama and House Speaker John Boehner have not yet reached a compromise. The deadline is looming as is the possibility the country will have to default on its $14.3 trillion of debt. As time marches on, analysts are starting to think seriously about what would happen if no deal can be reached. A vote was expected today in the House on Boehner’s last bid to increase the debt limit and cut spending — but that all fell apart last night when Tea Party Republicans refused to vote for it.

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The Takeaway

IMF Chief Warns of Global Consequences of US Default

Wednesday, July 27, 2011

The looming threat of the U.S. defaulting on its debt has prompted many to discuss what the consequences might be here. But what happens to the rest of the world if the U.S. defaults? According to the International Monetary Fund, it will be a disaster. At a press conference yesterday, IMF chief Christine Lagarde called a U.S. default "a very, very, very serious event, not just for the U.S., but the global economy at large."

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The Takeaway

What If Congress Doesn't Raise the Debt Ceiling By Aug. 2?

Tuesday, July 26, 2011

In his speech last night, President Obama urged the House and Senate to reach a compromise on a debt plan by August 2. "We can't allow the American people to become collateral damage to Washington's political warfare," he said. Immediately afterward, House Speaker John Boehner gave a live speech responding to Obama, in which he pushed for Obama to sign the Republican plan to raise the debt limit. The Democratic-led Senate and Republican-led House have proposed two vastly different plans. So, what happens if they can’t agree by the deadline? 

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The Takeaway

Parallels of National Decline: Poland and the US?

Tuesday, July 26, 2011

August 2 is one week away, and Congress still has yet to make a deal to raise the debt ceiling. Both sides of the debt debate are reluctant to compromise — both the Democrats and Republicans have now put forth plans to avoid a default on U.S. loans. The Republican plan includes immediate cuts and caps in discretionary spending, and raising the debt ceiling by less than $1 trillion. The Democratic plan includes a $1.2 trillion reduction in both defense and non-defense discretionary spending.

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The Takeaway

Top of the Hour: Contingency Plan Emerges in Debt Deal, Morning Headlines

Monday, July 25, 2011

After talks collapse between President Obama and House Speaker John Boehner, Democrats and Republicans will release separate plans to raise the debt ceiling before the August 2 deadline. That and this morning's other headlines. 

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The Takeaway

Eurozone Leaders Hold Emergency Meeting in 'Make-or-Break' Moment for Greece

Thursday, July 21, 2011

Eurozone leaders are meeting in Brussels today, for an emergency summit on the looming debt crisis in Greece. Greek Prime Minister George Papandreou called this summit a "make-or-break" moment. Meanwhile, the International Monetary Fund warned that this crisis could spread to the rest of Europe, even if Eurozone leaders prevent a default in Greece.

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The Brian Lehrer Show

DEBT: The First 5,000 Years

Tuesday, July 19, 2011

Anthropologist David Graeber, reader in social anthropology at Goldsmiths College, University of London, talks about his new  book, DEBT: The First 5,000 Years, and proposes a radical debt forgiveness scheme

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The Takeaway

Do We Need a Debt Limit?

Tuesday, July 19, 2011

We’re exactly two weeks away from the August 2 deadline for lawmakers to raise the nation’s debt ceiling.  If Congress can’t come to an agreement by then, the U.S. may default on its loans, and that could likely mean losing our Aaa bond rating. But with debt ceiling negotiations seemingly at a standstill, Moody’s Investor Service has suggested eliminating the debt ceiling altogether.

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The Takeaway

Rep. Chris Van Hollen on 'Cap, Cut and Balance'

Monday, July 18, 2011

With just over two weeks left until the August 2 deadline to raise the debt ceiling, Congress is expected to vote on the Republican "cap, cut and balance" plan, which would cut spending and raise the debt ceiling, while amending the Constitution to require a balanced budget. And while the measure may pass in the House, few expect it to get through the Senate. 

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