Source: White House Press Office

THE PRESIDENT: Hello, everybody. I wanted to give folks a quick update on the progress that we’re making on the debt ceiling discussions.

I was in contact with all the leadership over the course of the weekend and continued to urge both Democrats and Republicans to come together around an approach that not only lifts the debt ceiling but also solves the underlying challenges that we face when it comes to debt and deficits.

Some progress was made in some of the discussions, some narrowing of the issues. Speaker Boehner and the Republican House caucus felt it necessary to put forward the plan that they’re going to be voting on today. I think everyone’s estimation is, is that that is not an approach that could pass both chambers, it’s not an approach that I would sign and it’s not balanced. But I understand the need for them to test that proposition.

The problem we have now is we’re in the 11th hour and we don’t have a lot more time left. The good news is that today a group of senators, the Gang of Six, Democrats and Republicans — I guess now Gang of Seven, because one additional Republican senator added on — put forward a proposal that is broadly consistent with the approach that I’ve urged. What it says is we’ve got to be serious about reducing discretionary spending both in domestic spending and defense; we’ve got to be serious about tackling health care spending and entitlements in a serious way; and we’ve got to have some additional revenue so that we have an approach in which there is shared sacrifice and everybody is giving up something.

And so, for us to see Democratic senators acknowledge that we’ve got to deal with our long-term debt problems that arise out of our various entitlement programs, and for Republican senators to acknowledge that revenues will have to be part of a balanced package that makes sure that nobody is disproportionately hurt from us making progress on the debt and deficits I think is a very significant step. And as I said, the framework that they put forward is broadly consistent with what we’ve been working on here in the White House and with the presentations that I’ve made to the leadership when they’ve come over here.

So here’s where we stand. We have a Democratic President and administration that is prepared to sign a tough package that includes both spending cuts, modifications to Social Security, Medicaid and Medicare that would strengthen those systems and allow them to move forward, and would include a revenue component. We now have a bipartisan group of senators who agree with that balanced approach. And we’ve got the American people who agree with that balanced approach.

My hope, and what I will be urging Speaker Boehner, Nancy Pelosi, as well as Leader Reid and Mitch McConnell, is that they, tomorrow, are prepared to start talking turkey and actually getting down to the hard business of crafting a plan that can move this forward in time for the August 2nd deadline that we’ve set forward.

Just a couple of other points I will make. Some of you may ask, what does it mean for the plan that Senator McConnell and Senator Reid had been working on? Our attitude is, is that that continues to be a necessary approach to put forward. In the event that we don’t get an agreement, at minimum, we’ve got to raise the debt ceiling. So that’s the bare minimum that has to be achieved, but we continue to believe that we can achieve more.

And so I want to congratulate the Gang of Six for coming up with a plan that I think is balanced. We just received it, so we haven’t reviewed all the details of it. It would not match perfectly with some of the approaches that we’ve taken, but I think that we’re in the same playing field. And my hope is, is that we can start gathering everybody over the next couple of days to choose a clear direction and to get this issue resolved.
So far, at least, the markets have shown confidence that leadership here in Washington are not going to send the economy over a cliff. But if we continue to go through a lot of political posturing, if both sides continue to be dug in, if we don’t have a basic spirit of cooperation that allows us to rise above immediate election-year politics and actually solve problems, then I think markets here, the American people, and the international community are going to start reacting adversely fairly quickly.

So I think it’s very important for in these next couple of days to understand we don’t have any more time to engage in symbolic gestures; we don’t have any more time to posture. It’s time to get down to the business of actually solving this problem. And I think we now are seeing the potential for a bipartisan consensus around what that would take.

It will be hard. It will be tough. There are still going to be a lot of difficult negotiations that have to take place in order for us to actually get something done. And as I said, we have to have that failsafe that Senator McConnell and Senator Reid are working on. But the hope is, is that everybody seizes this opportunity.

All right? Okay, guys, I’m going to let Jay answer questions today. I think I’ve been pretty good to you guys. (Laughter.) But after the votes today in the House, I’ll call up Speaker Boehner and the other leadership and we’ll arrange for times where we bring folks back here, and hopefully we’ll be able to report on some additional progress over the next few days.

All right? Thank you very much, guys.

Q When will you announce whether you will be supporting the Gang of Six plan? Would that be in the next day?

THE PRESIDENT: Well, as I said, I think what you’re going to be seeing is an evaluation of that plan versus the things that we’ve been looking at. I think what you’re going to see is some significant overlap. But obviously just because we might agree in principle with a range of issues with six senators or seven senators, that doesn’t get us out of the House of Representatives; that doesn’t get us out of the Senate. There’s going to have to be a broader agreement on the part of all the leadership that we’re going to get this done in a serious way, and we’ve got a tight deadline to do it.

All right? Thanks, guys.

END 1:38 P.M. EDT

THE PRESIDENT: Well, good morning, everybody. I am here at Parkville Middle School and Center of Technology outside of Baltimore with Secretary Arne Duncan and Budget Director Jack Lew. And I just came to Parkville on a day where we are unveiling our budget, and I’m doing so for a reason. But before I do that I just want to thank Principal Buddy Parker, who is showing us around, as well as Susan Yoder, the eighth grade science teacher who we just visited with in her classroom.

Over the last few weeks I’ve traveled the country, talking about what we need to do to win the future; talked about the need to invest in innovation, so that the next big idea is discovered here in the United States of America. I’ve talked about the need to invest in high-speed rail and high-speed Internet, so that companies can move goods and information faster than ever. And this week, I’ll be talking about the need to invest in education -– in places like Parkville -– so that every American is equipped to compete with any worker, anywhere in the world.

These investments are an essential part of the budget my administration is sending to Congress. Because I’m convinced that if we out-build and out-innovate and out-educate, as well as out-hustle the rest of the world, the jobs and industries of our time will take root here in the United States. Our people will prosper and our country will succeed.

But I’m also convinced that the only way we can make these investments in our future is if our government starts living within its means, if we start taking responsibility for our deficits. That’s why, when I was sworn in as President, I pledged to cut the deficit in half by the end of my first term. The budget I’m proposing today meets that pledge -– and puts us on a path to pay for what we spend by the middle of the decade. We do this in part by eliminating waste and cutting whatever spending we can do without.

As I start — as a start, I’ve called for a freeze on annual domestic spending over the next five years. This freeze would cut the deficit by more than $400 billion over the next decade, bringing this kind of spending — domestic discretionary spending — to its lowest share of our economy since Dwight Eisenhower was President. Let me repeat that. Because of our budget, this share of spending will be at its lowest level since Dwight Eisenhower was President. That level of spending is lower than it was under the last three administrations, and it will be lower than it was under Ronald Reagan.

Now, some of the savings will come through less waste and more efficiency. To take just one example, by getting rid of 14,000 office buildings, lots and government-owned properties we no longer need, we can save taxpayers billions of dollars. And when it comes to programs we do need, we’re making them work better by demanding accountability. Instead of spending first, and asking questions later, we’re rewarding folks inside and outside government who deliver results. And to make sure that special interests aren’t larding up legislation with pet projects, I’ve pledged to veto any bill that contains earmarks.

Still, even as we cut waste and inefficiency, this budget freeze will require some tough choices. It will mean cutting things that I care deeply about — for example, community action programs in low-income neighborhoods and towns, and community development block grants that so many of our cities and states rely on. But if we’re going to walk the walk when it comes to fiscal discipline, these kinds of cuts will be necessary.

I’m also looking forward to working with members of both parties to take steps beyond this budget freeze -– because cutting annual domestic spending won’t be enough to meet our long-term fiscal challenges. As the bipartisan fiscal commission concluded, the only way to truly tackle our deficit is to cut excessive spending wherever we find it -– in domestic spending, defense spending, health care spending, and spending through tax breaks and loopholes. So what we’ve done here is make a down payment, but there’s going to be more work that needs to be done, and it’s going to require Democrats and Republicans coming together to make it happen.

We’ve begun to do some of this with $78 billion in cuts in the Defense Department’s budget plan, by ending tax breaks for oil and gas companies, and through billions of dollars in savings from wasteful health spending -– savings we’ll use to make sure doctors don’t see their reimbursements slashed and that they stay in the system seeing patients.

But here’s the thing. While it’s absolutely essential to live within our means, while we are absolutely committed to working with Democrats and Republicans to find further savings and to look at the whole range of budget issues, we can’t sacrifice our future in the process. Even as we cut out things that we can afford to do without, we have a responsibility to invest in those areas that will have the biggest impact in our future -– and that’s especially true when it comes to education.

Right now, this school, Parkville, is preparing our kids for the jobs and careers of the 21st century. It’s a school that nurtures what students are passionate about and prepares them for success. Students in the magnet program here start out by taking courses in each of four subjects –- from applied engineering to environmental science -– gradually focusing their studies on one subject over the next couple of years.

I’m told the most popular subject at this school is engineering. And that’s important, because today the most common educational background for America’s top business leaders isn’t economics. It’s not finance. It’s not even business. It’s engineering.

Engineering and math, critical thinking, problem solving –- these are the kinds of subjects and skills that our kids need to achieve success in the 21st century. That’s why we’re spearheading a drive to prepare more than 10,000 new math and science teachers over the next five years, and train 100,000 more current teachers in those fields. That’s why we’re pushing forward on a Race to the Top in our schools that has led over 40 states to raise their standards for teaching and learning for less than 1 percent of what we spend on education each year. That’s why we’re protecting the more than $800 increase that we added to the most widely used federal scholarships, and making the tough choices to put them on a firm footing for years to come. And that’s why we’re on track to meet the goal that I set when I took office: By 2020, America will once again have the highest proportion of college graduates in the world.

I know the American people understand why this is so important. And I think that those of us who are working in Washington need to understand why these investments in the future are so important as well.

I mentioned in my weekly radio address a letter that I recently got from a woman named Brenda Breece. Brenda is a mom. She’s a special ed teacher in Missouri, and her husband, David, lost his job when the local Chrysler plant shut down. So money has been tight for the family, and they’ve had to sacrifice the little things that they can do without. One thing that Brenda knows she can’t afford to sacrifice is her daughter Rachel’s education. And that’s why she’s looking, as we speak, for a second job to help put Rachel through college, and ensure, as she told me, that “the money is there to help Rachel with her future.”

What’s true for Brenda’s family is true for the larger American family: Education is an investment that we need to win the future — just like innovation is an investment that we need to win the future; just like infrastructure is an investment that we need to win the future. And to make sure that we can afford these investments, we’re going to have to get serious about cutting back on those things that would be nice to have but we can do without.

That’s what families across the country do every day –- they live within their means and they invest in their family’s futures. And it’s time we did the same thing as a country. That’s how we’re going to get our fiscal house in order. That’s how we’ll grow our economy and attract new jobs to our shores. And that’s how America we will win the future in the 21st century.

Thanks very much, everybody.

Yesterday I mentioned that I don’t use credit cards. Some of you may have fainted, gotten back up and then wondered aloud, “How will she buy a house or a car or other big stuff?” Thanks for your concern! Okay, fine, maybe I have an over-active imagination. But I can’t be the only one who has been told by co-workers, friends, or older adults that I have to start building my credit if I ever want to achieve the white picket fence enclosing the American Dream.

Well my friend, the need for credit cards is a big fat lie. You don’t need the magical plastic if you live a financially responsible life. And it isn’t as tough as you may think. You are probably doing several financially responsible things right now (fingers crossed). If not, you have the power to start ASAP. Let’s face it, apartments are cool, but someday you may want a house. I know I do.

So again, I’m taking some wisdom from Dave Ramsey. In his book, The Total Money Makeover, he has a whole chapter dedicated to Debt Myths. I’m going to cover some of his astute anti-credit card points. If you get tired of me or if I don’t give enough info – check his stuff out!

Here’s how to get a Mortgage without touching a credit card (even with a 10 foot pole).
Solution 1: Dave is a little crazy sometimes. His most obvious suggestion for getting a house without credit is to pay with cash. I, budget addict that I am, can’t imagine waiting the…ummm, long time it would take me to save up $150 thousand, give or take. But if you feel up to the challenge, please go for it! And tell me if you achieve it so I can have hope (and be all jealous). But seriously, this is a possible solution, and with discipline and patience you will save a lot of money.

If you want to buy a house sooner than an “ummm, long time,” here are some other tips for getting a mortgage without credit.
Solution 2: Find a mortgage company that will underwrite your loan. According to my extensive research, this means finding a company that will take your financial responsibility factors into account instead of just your credit score.

Soultions 2.1-4: If you find a company that does underwriting, what will they be looking for? Great question! Let me tell you.

• Great Renting History: Have you paid rent on time for the past two years? Seems pretty easy. Hopefully we’ve all been doing that. If not, we need to talk. Please see me after class.
• Solid Employment History: I know that phrases like “layoffs” and “tough economic times” swirl around like confetti in this day and age, but if you’ve been fortunate enough to hold a steady job for the last 2 years then, that’s another factor that will help you.
• Healthy Down Payment: Putting 0 percent down on a house sounds tempting, but don’t go there, it is a trap. Do you want to end up owing more on your house than it is worth, a.k.a. have an underwater mortgage? I didn’t think so. Go scuba diving in the real ocean, not with your money.
• Reasonable Loan Request: Your monthly payments should only be about 25% of your take-home pay. This is a safe request, and it should help you get qualified.

It took me longer to rant and rave about the mortgage issue than I thought it would, so I don’t have the time or energy to go into other Credit Card myths.

But here’s the bottom line: Save up money to make big purchases, even cars! And you will be freed from payments that can come into your life and steal all of your saving and fun power. I think my friend Dave would agree; debt is not a lifestyle that you have to accept. A little patience and discipline will give you financial freedom for the long haul.

Hello, and welcome to the final budget tip in this series. I know, budgeting posts may not be as exciting as sky diving or white water rafting posts, but I firmly believe that people (and even “young adults”) can take control of their finances and quickly enter a debt free lifestyle. And although that may not give you the rush like jumping out of a plane or bouncing over frothing water would, it will give you the peace of financial freedom (which is officially equivalent to five or more sky diving sessions).

I typed this dramatic preamble to lead to a simple concept: The Cash System. Here are a few reasons why I think it works and why it’s worth trying out! The general principles below come from common sense and the guidance of Dave Ramsey. Check him out; his book “The Total Money Makeover” is a great resource for no nonsense money management.

Easy to keep track of your moolah

Every other Friday, my husband and I pull out a certain amount of money. We are expected to live on that amount of money till the next “Cash-Money” Friday. Once the money is gone, we are done spending. It’s that simple. We leave ourselves very little reason to use our debit card between Cash days. (Note, I did not say credit card. We don’t even have one of those! Extreme, I know). We use this cash for groceries, gas, minor car maintenance (oil changes, etc.), clothes, haircuts and fun (movies, eating out, putt-putt golf — you fill in your own fun blank here).

Using this technique, you can emerge from the shadowy land of over-drafting your account, buying a McDonald’s meal on your card, digging through your car seats to find all those crumpled receipts and generally wondering where all your money goes.

Oh, no! You will be in control, baby.

Simple to separate

The key to TAhe Cash System is separating your money into different categories. Once we get out the cash, we separate it into different pockets of a cool miniature expanding file envelope (You can find them at Wal-Mart). Okay, it is not cool at all, and you may feel really dorky bringing that thing out at restaurants and stores, but believe me, it is ultimately worth it. I separate the money into week one groceries, week two groceries, gas and fun money. I then give my hubby his personal fun money and stash away my own. This is where it gets fun (fine, that’s a relative term here).

Say one week you don’t spend as much as you budgeted for groceries. Well then you can plop that extra money right into the fun money slot. You can go out for an extra date that week. Or maybe, if you are really disciplined, you can start a Christmas or vacation fund. Every little bit counts, and before you know it, you may have enough cash for all Christmas purchases. So while all your friends are belly aching about their credit card bills in January, you will try your best not to be smug as you explain the beauty of The Cash System.

Harder to spend

This is a mental thing, but for most people, it’s harder to fork over cash than to swipe a card. When you hand over bills you can see your money supply dwindling. This view allows you to take a second and assess if you really need those pork rinds or that (insert your own tempting item here). The thought of having money to bank at the end of the two weeks is ever-alluring, and it will make you think about each purchase. I guess the cash system makes money real. It changes it from this pretend currency that magically comes from an overflowing spring activated by your card into a precious and limited commodity that needs to be used thoughtfully. Deep, I know.

Ok that is enough (see, I budget my words too!). I hope that I’ve inspired you to go buy that awesome money divider thingy, and try your hand at The Cash System. Best of luck as you embark on this common sense, proven, and ultimately fun system!

It is Friday. And that means that the next few days are ones of freedom and relaxation (unless you work weekends, and in that case, I am sorry). For all you “budget conscious” people out there, the weekend is also a time of conflict. You want to hang out with people, but the usual “dinner and movie” plan will, in all likelihood, annihilate your budget. Fifty bucks down the road, all you’ll have to show for your good time is a full (or in my case, aching) stomach and a tattered movie stub.

Do you want more from your weekend? If you answered, “Yes” then read on! (Am I starting to sound like an infomercial? If so, mission accomplished!)

Twister

Rule #1: Pick a game (or two) appropriate to the size of the gathering. For 4–6 players you can go ahead and pick something with more complex rules or involved thinking.

Suggestions: In a Pickle, Last Word, Scattergories, Apples to Apples, The Game of Things or even go “old-fashioned” and play a card game (Nertz is a great choice among good friends).

I‘ve played all of these in a Game Night setting to varying degrees of success. WARNING: When tried with more than 10 people, these games will become trying and boring to most. So make sure you follow my advice OR ELSE. Also games that require knowledge about the other players (Imaginiff, I’m talking to you) aren’t very fun if you are playing with a new group. Again, consider your audience, and you will be fine.

For 6 or more players, Catch Phrase is my favorite way to fly. But I’ve also played Buzz Word or Taboo with a larger group and had a great time. Bottom line, the game needs to be easy to understand. Bonus points for one that involves shouting out answers which will maximize participation.

Rule#2: Decide that winning is far less important than getting to know people.

Please don’t be ultra-competitive at Game Night! Nobody wants to be or play with “that guy/girl.” Friendly banter: yes. Battle of the sexes: perfect. Making everyone uncomfortable as you punch your best friend and shout, “You’re going down, you idiot!” Not allowed. Get the picture?

The idea is to have fun. You can keep score for bragging rights, but just make sure that no one is getting emotionally invested in the results or else mayhem will ensue.

Rule#3: Provide great snacks.

This is where a small cost may come into play. However, you can still go cheap. Most people will be impressed with baked goods and an assortment of drinks. A game night at my house would most likely include brownies or cookies (or both, if I’m feeling generous). I might even throw in some chips and salsa/cheese dip/guacamole for those (weirdos) who enjoy salty snacks more. Play to your talents. In my experience even slice-and-bake cookies will kill. You could even ask people to bring stuff and create a mini-potluck. The sky is the limit, my friend. Remember, no food won’t ruin game night, but cookies will make it that much more fun.

I hope I’ve inspired you to try your hand at hosting a game night. It really is a great way to spend time with people without spending your future children’s college funds.

Come back here on Monday to find out how to stretch your dollar the most when it comes to groceries — I’ll tell you how menu planning can be your friend! Comment below if there are any budget questions YOU want to Ask Alexis, Blast’s very own budget expert.

Here’s a quick tip for those of you who are (I won’t say poor, but…) “budget-conscious” like me. I think we should sell all worldly possessions and live off the earth. Well, wait a minute. While that might actually be cool, I’m suggesting the step before selling all possessions. I recommend looking at your monthly cable bill to see if you’re getting your money’s worth. You might be surprised. Or maybe not. Whatever.

I’d like to think I’m pretty culture savvy. I love reading, watching movies and TV and then discussing said books and media with my educated friends. But to be caught up on TV (and thus TV discussions with other culture-savvy people), most people think you need to pay $100+ a month to the likes of AT&T or Comcast.

I say “Oh no, you don’t!” “How?” you ask. “Read more!” I say.

Here’s the answer: Internet + Hulu and Netflix! I admit, to take my advice you do have to pay AT&T or Comcast (or the internet provider of your choice) about $35 a month. But then, eureka – instant culture-savvy potential!

With my strategy, you can save over $50 a month and not really feel deprived. Through Hulu, you can still laugh at Liz Lemon’s junk food habits and giggle at Manny’s cute grown up tendencies without paying the big bucks. On Hulu, you can even watch the shows whenever you want, kind of like “other peoples’” DVR recordings. **A word of caution: Hulu does take episodes down within a week or 2 so you do have to stay on your toes.**

With the internet, you can also get your movie fix with Netflix Watch instantly (okay, that’s another $9.73 a month). But with their power combined, I’m Captain Saves…ok, I’m not even going to try to finish that sentence.

Here’s the technical part, in case you were wondering. I use an S-video cord (about $10 or so at most stores) to switch the screen display from my laptop to my TV. I then hook up some computer speakers to the laptop to enhance my hearing experience. However, I know that there’s a cord that will transfer sound too. I’m not sure of all those details, but it is important that you make your own choices on this journey anyway.

I will admit, if your house lives and breathes sports or reality TV then this awesome saving technique may not work for you. Live things aren’t really available via internet. In this case, you will have to decide if saving money is worth it. It may not be. But it’s worth a thought, no? I’ll admit — and just because we’re good friends — I had to give up American Idol watching/mocking sometimes. If you are concerned about such things, you can get antennae, and you may be able to pick up some of those things live. But (gasp!) you will have to be home and planted in front of the tube when the action is really happening (or go really old school and pull out your VCR).

I hope that this has given you some food for thought. This is coming from a person who has ordered and then cancelled cable twice in the last two years. I like the thought of cable, but in the end the cost just doesn’t work for me. And even if you drop the bill and don’t use all these fancy cords and internet, a little less TV in life never hurt anybody. Right?

Tune back in tomorrow for the next installment in my budget-saving series, where I’ll tell you all about how to have a fun night with friends without breaking the bank.

President Obama announced today the details of his plan to slice $17 billion from the proposed $3.5 trillion 2010 budget.

The proposed budget cuts only account for about 0.5 per cent of the total 2010 approved spending, but Obama stressed that while this is true, this particular $17 billion can be put to much better use than it has been in Washington.

“There is a lot of money being spent inefficiently, ineffectively, and — in some cases — in ways that are actually pretty stunning,” Obama said, according to CNN Money. “To put this in perspective, this is more than enough savings to pay for a $2,500 tuition tax credit for millions of students as well as a larger Pell Grant — with enough money left over to pay for everything we do to protect the National Parks.”

Well, if you put it that way.

For those who don’t know, the Federal Pell Grant program provides low-income undergraduate and eligible postbaccalaureate students with grants to promote post-secondary education.

About $11.5 billion of the budget cut would come from programs that don’t receive automatic funding, and half of the total savings would come from non-defense related programs, CNN Money reports.

A senior official stressed that many of the proposed cuts are from duplicate programs or programs whose performance doesn’t justify the funding, like the early education program Even Start which would be cut if the plans are approved.

The biggest o‚ cuts on the budget reform fall under the defense umbrella, with $6.24 billion cut from recruiting and retention programs and nearly $6 billion cut from the development of manned ground and air vehicles, like the F-22 Raptor.

Routinely, defense spending accounts for 20% of the yearly budget.

The president promised many more budget cuts to come, CNN Money reports.

• Obama’s first budget comes with the promise of slashing the deficit in half in four years

President Obama launched a “fiscal responsibility summit” at the White House today by vowing to cut the federal deficit in half by the end of his first term in office, and he pledged to reinstate pay-as-you-go budgeting rules to prevent the government from spending money it does not have.

• The government is looking to buy majority stakes in large banks as the markets continue to tumble.

WASHINGTON “" The Obama administration put the nation’s biggest banks on notice Monday that the government could become their biggest shareholder if regulators decide they are not strong enough to weather a deeper-than-expected downturn in the economy.

• US is secretly training the Pakistani military to fight the Taliban and al-Qaeda.

BARA, Pakistan “" More than 70 United States military advisers and technical specialists are secretly working in Pakistan to help its armed forces battle Al Qaeda and the Taliban in the country’s lawless tribal areas, American military officials said.

The Americans are mostly Army Special Forces soldiers who are training Pakistani Army and paramilitary troops, providing them with intelligence and advising on combat tactics, the officials said. They do not conduct combat operations, the officials added.

• Karl Rove defies a Congressional subpoena. Again.

So today was the day that Karl Rove was supposed to appear before the House Judiciary committee to testify about the US Attorney firings. And of course, Rove didn’t show.

That wasn’t a surprise. After getting the deadline pushed back, Rove had already publicly indicated he didn’t plan on being there, citing President Bush’s claim of executive privilege. Rove’s lawyer had then asked for a second postponement, a request that Judiciary chair John Conyers had declined to grant.