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Retirement Planning > Social Security > Social Security Funding

Forget 2011 Budget, FY2012 Budget to Be Delayed as Well

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Thanks to a months-long delay in the confirmation of President Obama’s choice for budget director—caused by a hold on the nomination placed by a fellow Democrat—and also because of the disagreements over funding the government for 2011, Obama announced that his release of the fiscal year 2012 budget will be delayed by about a week.

Sen. Mary Landrieu (D-La.), had placed a hold on the nomination of Jacob Lew for budget director in protest over the administration’s offshore oil drilling moratorium. The moratorium was lifted in October, but, according to the Washington Post, Landrieu continued the hold anyway, citing objections to the way permits were being issued. Lew was not confirmed until Nov. 18.

Currently the government is being funded by a continuing resolution (CR) rather than a budget, since Congress could not agree on a full appropriation bill. It abandoned the omnibus funding bill before Christmas and instead passed the continuing resolution, which will keep the government running till early March.

Originally Obama had planned to release the budget on February 7, according to a Washington Post report, but now instead, Reuters reports that he will hold it till after February 14. It is expected that there will be a stiff fight over various measures in the budget with the new Republican majority in the House and the gain of Republican seats in the Senate.

Obama is said to be studying the recommendations from his appointed deficit reduction commission, which call for stringent cuts that Republicans favor, as well as an increase in the retirement age for Social Security and a reduction in tax deductions on such items as mortgage interest and health insurance premiums. Republicans are expected to want the budget to focus on cutting the deficit rather than stimulating the economy.

Among numerous other areas of government, the budget debacle will affect the Securities and Exchange Commission (SEC), which will have its hands full trying to implement all the new rules under Dodd-Frank. The continuing resolution did not give the SEC any additional funding to do so, which falls in with some Republicans stated plans to defund the reform law.

Before leaving last week to spend Christmas in Hawaii with his family, Obama had said of the upcoming budget, “I expect we'll have a robust debate about this when we return from the holidays—a debate that will have to answer an increasingly urgent question, and that is: How do we cut spending that we don't need while making investments that we do need?”


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