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Monday, August 1, 2011

World News! The "We May Not Hit The Debt Ceiling" Edition!

  • The EU and the IMF have begun their first review of Portugal's bailout, which will examine Portugal's efforts to meet the terms of the rescue package agreed to in May, and determine whether the next tranche of funds for that bailout will be released.
  • In "happy Ramadan" news, tanks are shelling the city of Hama for a second day, attempting to crush protests against Brutal Dictator (or, as he likes to say, "President") al-Assad.
United States
  • We have a (tentative) debt ceiling deal!  The plan, which still has to pass both the House and the Senate by tomorrow, plans to cut about $2.5 trillion from the budget deficit over the next 10 years.  This figure is, of course, about $1.5 trillion shy of the minimum amount the credit rating agencies wanted to see to guarantee that our sovereign debt rating wouldn't be cut.
  • If you're curious about the debt ceiling deal, Reuters has a summary.  The details include:
    • The President can raise the debt ceiling (by up to $2.4 trillion, according to the BBC) in three steps, and Congress cannot block the first two increases without a supermajority in both the House and Senate.
    • There will be roughly $2.4 trillion in spending cuts over the next 10 years, with $917 billion being approved when the deal passes and another $1.5 trillion being approved by the end of the year.
    • The first group of spending cuts would apply to discretionary programs that congress approves annually, and those programs would be capped each year for 10 years.  Roughly $350 billion would come from defense and other security spending, which currently accounts for more than half of all discretionary spending.
    • Automatic spending cuts will kick in if Congress does not observe the caps in coming years.
    • A 12-member congressional committee, 6 Democrats and 6 Republicans, will be created to locate the other $1.5 trillion in spending cuts.  They must complete their work by November 23, and the recommendations must be voted on by December 23.  If they cannot agree, automatic spending cuts will kick in.
    • The House and the Senate must vote on - but not necessarily pass - a balanced budget amendment to the Constitution.
  • Al Jazeera has an illuminating - and somewhat creepy - article about the "American Taliban".
  • It turns out that Apple has more operating cash on hand than the United States government, by $2.4 billion.  Think about that.
  • A rare - and completely intact - fossil thalattosaur skeleton has been found in the Tongass National Forest in Alaska.
  • US carmakers have agreed to new fuel efficiency standards proposed by the White House, standards that call for the average miles per gallon of cars and light trucks sold in the us to increase to 54.5 mpg by 2025.

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