Good morning! Here’s what you need to know:
1. President Obama yesterday unveiled his deficit reduction plan, which he said will reduce federal spending by $4 trillion over 12 years. The plan calls for higher taxes on “wealthy Americans,” reduced defence spending and a Medicare cost control panel board called IPAB.
2. A transcript of the speech is here. Paul Krugman, perhaps President Obama’s most important critic on the left, gave the speech good marks. John Podhoretz, an articulate Obama critic of the right, was taken aback by the speech’s central premise, which was that America’s greatness can be measured by the size of its social programs.
3. Rep. Paul Ryan yesterday threw cold water all over the idea that a “grand bargain” on federal spending (to dramatically lower the federal deficit) would be arrived at any time soon. Mr. Ryan said the two parties were too far apart to come together under the umbrella of a single deal, but that smaller budget deals were possible, if not probable.
4. Meanwhile, it turns out that the Obama-Reid-Boehner deal that promised to cut $38 billion in federal spending from the FY 2011 budget is a fraud. The actual amount that will be cut, according to the Congressional Budget Office, is $352 million.
5. Opposition to the FY 2011 federal budget deal is growing like wildfire in Congress, as members learn more about how $38 billion in cuts became $352 million in cuts. GOP presidential hopeful Tim Pawlenty urged lawmakers to reject the deal when they vote on it today (or tomorrow).
6. President Obama’s speech yesterday was strikingly partisan. As most every commentator has said, he used Rep. Ryan’s budget plan as his target and bombarded it repeatedly. The president focused especially on Medicare, striking the pose that he was its most stalwart defender. Mickey Kaus has a good brief on that.
7. The question that hangs over the Department of Justice, the US legal establishment and the financial services industry is this: How is it possible that there have been no major criminal prosecutions of anyone of any note in the financial services industry, given the massive amount of fraud that took place in the run-up to the meltdown of the the global financial system in the fall of 2008? Gretchen Morgenson and Louise Story try to answer the question.
8. The Financial Times reports: “US Senate investigators probing the financial crisis will refer evidence about Wall Street institutions including Goldman Sachs and Deutsche Bank to the Justice Department for possible criminal investigations, officials said on Wednesday.”
9. Iran is helping the Syrian regime put down pro-democracy demonstrations while at the same time it aids those demonstrating against the regimes in Bahrain and Yemen. The battle for Bahrain is seen by most as a proxy war between Saudi Arabia and Iran for influence in the region.
10. David Ignatius has a good column on the three power brokers who are being billed as “the founding fathers” of the “new” Egypt.