Other Spending

December 11 - Yesterday, the House approved a $14 billion emergency loan package for the Big Three automakers - General Motors, Ford, and Chrysler. The bill uses money from the Department of Energy program designed to "green" auto manufacturing plants, and reprograms it to extend emergency bridge loans to the Big Three. The bridge loans would supply short-term financing while the auto companies restructured their operations and renegotiated their agreements with lenders, labor unions, and suppliers. Ford has said it is unlikely to need the financial assistance barring a massive market collapse.

The loan package faces an uncertain future in the Senate, where many Republicans oppose the aid, despite White House pressure to pass some kind of assistance to Detroit. Chairman of Senate Banking Committee Richard Shelby (R-AL) in particular has expressed misgivings about the legislation, and has not ruled out filibustering the package.

December 5 - Today at noon, the New America Foundation (NAF) will host an event on Social Policy After the Economic Crisis. The event will include panels on Entitlement, Workforce, and Health Care issues, and will feature a number of experts from NAF and other think tanks, as well as Democratic Party Platform writer Karen Kornbluh. According to NAF:

While all eyes remain focused on Wall Street's daily rollercoaster ride, America has entered the era of the trillion dollar deficit and its social safety net is strained to capacity. The bursting of the credit and housing bubbles will be felt far beyond the economic policy arena. It will heighten the need for a comprehensive rethinking of the policies and institutions that make up the social contract, which had for decades enabled economic mobility and a broadly-shared American prosperity.

RSVP to attend the event in person, or watch the video below from 12:00 to 3:15.

November 25 - The Federal Reserve pledged an additional $800 billion today across several different initiatives to help unfreeze credit markets.  $100 billion of funds will go to purchasing debt directly from Fannie and Freddie Mae, while another $500 billion will be used to purchase mortgage-related securities backed by Fannie, Freddie or Ginnie Mae.  The final $200 billion will be lent through the newly-formed Term Asset-Backed Securities Loan Facility (TALF) to support loans for consumers and small businesses.  For a chart of other recent actions by government in response to the financial crisis, see pages six and seven of CRFB's "Guide to Stimulus Proposals"

November 17 - The International Herald Tribune reports that many states are facing the serious prospect of major budgetary shortfalls due to the economic downturn. Because many states are required by law to balance their budgets, some will be forced to either raise taxes or significantly cut spending to make up the difference.  California, providing one of the most dramatic examples, has a $15 billion gap between estimated revenues and expenditures.  In sum, all but approximately twelve states-mostly those with rich oil and mineral resources--will likely have difficulty balancing their budget for 2009. Already, over the past few weeks, several cities and