Monthly Archives: February 2013

Brownback warns that Washington budget cuts could shutter meat plants

Gov. Sam Brownback

Kansas Gov. Sam Brownback warned that Kansas meat processing plants may shut down if automatic federal budget cuts lead the Obama Administration to temporarily layoff meat inspectors.

In a letter sent Thursday to U.S. Agriculture Secretary Tom Vilsack, Brownback and Kansas Secretary of Agriculture Dale Rodman said that Vilsack’s recent comments about sequestration cuts leading to furloughs for meat inspectors is a major concern for Kansas because lack of inspections would cause an excess of market-ready animals that can’t be shipped out of state or sold.

“In addition, consumers will face limited meat supplies and potentially higher prices,” Brownback and Rodman warned in the letter.

That’s because meat that is not inspected can’t be sold.

At least one federal official has said the potential furloughs could be staggered to avoid such meat production shutdowns, according to CNBC.

Vilsack said it could take months before the furloughs would happen.

Kansas is home to several major meat packing plants, and Brownback said lagging inspections could cost the state industry hundreds of millions.

To learn more about the beef industry in Kansas and elsewhere, see a recent project by the Kansas City Star.


Pompeo, White House trade words over impending budget cuts

U.S. Rep. Mike Pompeo and White House Press secretary Jay Carney swapped words Tuesday over the impending sequestration cuts.

Carney, speaking during a press briefing, mentioned Pompeo when talking about whether the cuts could still be prevented:

“Well, we’ll have to see what the Republican leadership does.  Unfortunately, on the other side of the ledger, we’ve seen comments, as we did from Congressman Pompeo, a Republican Congressman, that suggests a different course of action.  He said it would be a home run politically for Republicans to see sequester implemented.  I wonder if he would say that to the 90,000 Defense Department workers in Virginia who would see their pay cut because of furloughs, or the thousands of Virginians who would lose their jobs because of sequester if it were allowed to be implemented.  We certainly don’t think that’s a home run for ordinary Americans, even if that Congressman thinks it would be for him politically.”
Pompeo fired back with a news release cast as a response to “today’s misguided White House attacks”:
“Mr. Carney doesn’t understand that not every public official is willing to play games with lives of hard-working Americans for political gain like his boss, President Obama.  I said that the sequester is a home run not because it is good politics, but because it begins to put America back on the right fiscal track.

“I would welcome the opportunity to tell the 90,000 furloughed workers, the ones President Obama is choosing to let go of, that they need to know several things:

“First, the sequester does not have to mean furloughs.  The President is choosing to make this minor reduction in spending painful — by furloughing people — in order to pursue his twin goals of raising taxes and increasing the size of the federal government.  The President wasted $1 trillion dollars of stimulus money that did nothing to grow our economy and create jobs.  Now, he is needlessly using a decrease in federal spending amounting to less than a few percent to harm even more American workers and their families.

“Second, there are fewer Americans working in America today than when the President took office.  I find it bizarre that Mr. Carney would ask me about talking to furloughed workers.  I’ve been talking to and representing thousands of furloughed and laid-off workers in Kansas who have lost their livelihood because of this President’s failed economic policies and his consistent attacks on the general aviation industry.  Before President Obama’s wreckless deficits, general aviation was a robust manufacturing jewel providing high-paying jobs in the Air Capital of the World.  Today, he continues to cause it pain.

“Third, Mr. Carney says that this isn’t a home-run for average Americans.  He is wrong.  While there will surely be dislocations, the President’s $6 trillion in new federal debt have been a strikeout for our country.  Most Americans understand the need to stop year-on-year trillion dollar deficits.  For them, we should have done even more to reduce the size of our federal government.  The sequester is a solid first step.  Growing American prosperity will require us to hit a grand slam on reducing spending, taxation, and regulation.  I look forward to being part of making that happen.

“Finally, the President proposed, signed, and threatened to veto changes to, the sequester.  It was his plan.  Not once, but twice, Congressional Republicans have provided alternatives.  We have seen nothing from Carney’s boss.  If it is really that bad, why has he not sent a different set of cuts?  The President’s actions — claiming to be upset about the sequester and traveling to Virginia to confuse workers there — are at best disingenuous and at worst just plain mean.”


White House: Military, school and health cuts will hurt Kansas if sequester not averted

Kansas will lose at least $79 million in funding for the state’s military bases and face about $10.8 million in cuts to education if Congress and the president can’t reach agreement to head off automatic budget cuts scheduled to begin Friday, according to a new White House report.

Those and other Kansas-specific cuts –- part of the national “sequestration” debate –- are detailed in a state-by-state report released by the White House Sunday evening.

Staffs for Kansas’ two senators and Wichita’s House representative were reviewing the numbers Monday and said they think there may be less painful ways to implement cuts than what the White House has described.

“Washington should be more than capable of cutting less than three percent of its nearly four trillion dollar budget,” Sen. Pat Roberts, R-Dodge City said in an e-mail. “In fact, considering our staggering national debt and the dramatic increase in federal spending under President Obama, we should be able to cut more. However, these savings won’t be achieved through bully pulpit scare tactics and localized threats via White House press release.”

Rep Mike Pompeo, R-Wichita, who also responded to Eagle questions via e-mail, had a similar reaction to the White House report.

“This small dose of fiscal discipline will need not result in the calamities President Obama is suggesting,” Pompeo said. “It simply requires leadership. Every day, Kansas’ small businesses have to figure out how to survive with lower revenues and drops in sales and, goodness knows, higher costs because of this president’s regulations.”

The Kansas-specific cuts detailed in the White House report include:

· Military spending – A $78 million reduction in operating funds for the state’s Army bases plus $1 million for Air Force operations. The report said 8,000 civilian employees would be given unpaid furloughs, reducing gross pay by $36.7 million. The report was not clear on whether the furloughs would be included in the base operations cuts or in addition to them and the White House press office was not immediately able to clarify that. If the furloughs are in addition to the base operations reduction, the military spending cut in the state would total $115.7 million.

· Schools – Kansas would lose $5.5 million in funding for elementary and secondary schools, which the White House said would put about 80 teacher and aide jobs at risk. The state would also lose about $5.3 million in funding for an additional 60 teachers, aides and staff who provide services to children with disabilities.

· Head Start and child care – Cuts would eliminate funding for approximately 500 children who attend early education programs and another 400 children of low-income working parents who receive assistance in paying for child care.

· Higher education – About 310 fewer Kansas students would receive financial aid for college and 140 fewer students would be offered work-study jobs to help pay for their education.

· Senior nutrition – The state would lose $209,000 that helps provide meals for elderly residents.

· Environment – Kansas would lose about $1.8 million in funding for programs to ensure clean air and water and to prevent pollution from pesticides and hazardous waste. In addition, the state would lose $772,000 in grants for fish and wildlife protection.

· Job search and training – Kansas would lose about $322,000 for job assistance, meaning about 11,130 fewer people would receive training and assistance in finding work.

· Public health – Kansas would not receive more than $1 million in grants, including $610,000 for substance abuse prevention and treatment, $273,000 to prepare for responses to threats such as infectious disease outbreaks, bioterrorism, nuclear or chemical accidents; $85,000 for childhood vaccinations and $65,000 for HIV testing.

· Law enforcement – The state would lose $149,000 in justice administration grants supporting various programs for police, courts, corrections, drug treatment and victim and witness assistance.

· Domestic violence – Kansas would lose about $61,000 in funds, resulting in as many as 200 domestic-violence victims not receiving services.

Kansas would also be affected by nationwide cuts in federal services such as aviation safety and security, emergency response, immigration enforcement, food safety, small-business loans and mental-health treatment, the White House said. Kansas-specific amounts were not detailed in the report.

The automatic budget cuts, called the “sequester,” total about $85 billion nationwide for the rest of 2013.

The sequester was part of a deal struck in August between the president and Congress that averted going over the so-called “fiscal cliff.”

The compromise plan raised the national debt ceiling so the country didn’t have to default on its debts. At the same time it dictated massive spending cuts to reduce the federal debt. The cuts are about evenly split between the defense and domestic budgets.

At the time, the cuts contained in the sequester were designed to be politically painful, to put pressure on Congress and the president to compromise on a deficit-reduction plan.

That hasn’t happened and it appears unlikely a deal will be struck before the cuts begin to take effect Friday.

Republicans have accused President Obama of attempting to inflate the level of crisis the sequester would cause to rally the public to his side. They say the cuts would amount to less than percent of federal spending and could be accomplished without major disruption.

Pompeo said he doesn’t think the sequester cuts enough.

“This bill isn’t perfect,” Pompeo said. “For instance, it only cuts $85 billion and doesn’t begin to address our long-term fiscal problems. It also impacts national security in ways that simply do not make sense by tying the hands of our military leaders needlessly. The House has twice passed legislation to address this concern.”

Added Roberts: “The President should be working with Congress to find more responsible alternatives to the sequester like eliminating waste, fraud and abuse and making sensible cuts to auto-pilot spending, rather than scaring the American people while demanding higher taxes.”

Obama and his Democratic supporters accuse the Republicans of obstructing progress to protect their wealthy supporters.

The president has advocated for solving the sequester through what he calls a “balanced” package of some spending cuts and closure of tax loopholes that primarily benefit the richest Americans.

Former Bear Stearns executive to advise Brownback economic advisors

The former chief economist and senior managing director of the now-defunct Bear Stearns investment banking firm will give the opening presentation when Gov. Sam Brownback’s Council of Economic Advisors meets on Wednesday in Topeka, according to the Department of Commerce.

Wayne Angell worked for Bear Stearns from 1994 until 2002, six years before the company’s spectacular collapse in the subprime mortgage meltdown of 2008.

He served on the Board of Governors of the Federal Reserve Board from 1986 to 1994 and was a member of the Kansas House of Representatives in the 1960s.

Following Angell’s presentation, the council is scheduled to hear from Graham Toft of the consulting firm GrowthEconomics, Inc., on “A Comparative Analysis of Key Economic Indicators – Threats and Opportunities.”

The group also will receive updates from the secretaries of Agriculture, Commerce, Labor, Revenue and Transportation.

The meeting is scheduled for 1:30 p.m. Wednesday at the Board of Regents office, 1000 SW Jackson St., Suite 520, Topeka.