Last week, the U.S. Treasury released the Fiscal Year 2008 Financial Report of the U.S. Government.

According to a Treasury press release:

"Revenue results in this year’s Financial Report were $2.7 trillion, increasing slightly by $34 billion or just over 1 percent, compared to last year. Total costs were $3.6 trillion, an increase of $.7 trillion or 25 percent compared to last year. Net operating cost increased to $1 trillion, up from last year’s net operating cost of $275.5 billion."

During the last session of Congress, I introduced H.R. 3958, the Truth in Accounting Act, which would require the Treasury to calculate the long-term budget figure in this report to create greater transparency in the budgeting process and provide a more accurate assessment of our nation's real financial standing.

It would do this by requiring the Treasury to include a program-by-program calculation of : (1) the generational imbalance; (2) the fiscal imbalance; and (3) the total amount of the fiscal imbalance plus the public debt. The President, in preparing the federal budget, would then have to take this financial statement into consideration, including the effect of the overall budget upon: (1) the generational imbalance calculation and the fiscal imbalance calculation; and (2) the net present value of the overall fiscal exposures of the federal government.

In other words, our government would have a more accurate number from which to work when creating the federal budget, which could hopefully help to avoid irresponsible spending. In the not-so-distant future, our nation will be faced with making essential reforms to large domestic programs, like Medicare and Medicaid, to make them fiscally sustainable. However, we can’t do this responsibly without an accurate forecast of not only the short-term, but also the long-term financial standing of our nation. If we don’t get a grip on our finances, we will continue to spend more than we have. And our children will pay the price.

It’s no secret that when President Obama gets sworn into office, among his top priorities will be to guide Congress through an $850 billion economic stimulus package. As a result, this astronomical number has created a tsunami of activity from special interest groups looking for their piece of the pie. $850 billion is simply an astonishing figure - not only exceeding the hefty $700 billion price tag of the financial sector, but also dwarfing the annual budget for the Pentagon.

What does Obama intend to do with all of your hard-earned money? According to today's Washington Post, the 850 billion "would include at least $100 billion for cash-strapped state governments and more than $350 billion for investments in infrastructure, alternative energy and other priorities..."

You've got to wonder if the infrastructure investments that Obama is going to include in his package might come from the list of 11,391 projects that the U.S. Conference of Mayors recently submitted to Congress.  The list includes things like a $4.8 million polar bear exhibit at the Providence, RI zoo and a $1.5 million water ride in Miami, FL. 

According to a recent CNN article, other abuses of taxpayer dollars found within the report include:  "a proposed $20 million minor league baseball museum in Durham, North Carolina; $6.1 million for corporate jet hangars at the Fayetteville, Arkansas, airport; $20 million for renovations at the Philadelphia Zoo; and a $1.5 million program to reduce prostitution in Dayton, Ohio."

If nothing else, the next four years look to be a spending bonanza and a pork barrel free-for-all. Hold on to your wallets!

Paul Weyrich was a leader and a pioneer.  In co-founding the Heritage Foundation, Paul not only built one of America’s great grassroots organizations, but helped to change the course of the Republican Party and the country itself.  His fingerprints can be clearly seen on so many of the great conservative victories over the years.

Paul’s political conscience was like a guiding rudder through even the foggiest policy debate.  And in the rough-and-tumble world of politics he never backed down.  He was a fighter – but he always waged his battles with warmth, grace and good humor.

We will miss Paul dearly.  And our prayers are with the Weyrich family at this most difficult time.

But we can take heart in knowing that, even years from now, as memories fade, his legacy will grow ever brighter in the light of the freedoms he fought for, the principles he stood for, and the noble ideas he so eloquently and passionately championed. 

The Hill newspaper's Congress Blog posed a question today to Capitol Hill's influential lawmakers, pundits and interest group leaders in their weekly "Big Question" feature:

"What’s the next step for the GOP on the path back to electoral competitiveness?"

Here's what I had to say:

"The results of the 2006 and 2008 elections have forced the GOP to refocus their efforts to restore the conservative brand. Instead of just talking about fiscal responsibility (yet acting contrary to this message), we must once again restore the trust of the America voter through action."

Read the full post here.

A front page story in Thursday's USA Today newspaper caught my attention:

Late Wednesday night, Congress passed the Auto Industry Financing and Restructuring Act.  Like bailouts in the past, I firmly opposed it, as it offered no assurances that it would fix the failing business models that put the Big Three in this position to begin with, while offering no protection for the taxpayer's investment.

Last night's vote proved that the Bush White House and Democratic leadership are working lockstep to put taxpayers on the line for another irresponsible bailout without making the necessary structural changes and without renegotiating labor contracts. Throwing taxpayer money at Detroit's spiraling problems will not fix their long-term management and productivity troubles and they will only be back for more time and time again.

My Republican House colleagues and I presented an alternative to help the American automakers stabilize their industry while they execute long-term restructuring and reorganization.  That alternative would set hard benchmarks for reducing their debt and renegotiating money-pit deals with Big Labor and would set up the financial assistance as interim insurance instead of a taxpayer-financed bailout.  Unlike the proposal Congressional leadership has brought before Congress, which essentially nationalizes the auto industry, this alternative would maintain an outlet for private investment in the American automakers. 

However, Democratic leadership dismissed consideration of alternative proposals that could truly restructure these companies over the long-term and help them rein in costs.                                                                  

Late Tuesday night, the White House and the Congressional Leadership reached a general agreement on a $15-billion bailout bill for the auto industry. There are still some points that reportedly need to be worked out, and some Senate Republicans remain reluctant to support the package, which could threaten its passage by that body.

But, from what we've seen of the bill so far, here's a quick overview:

*       Calls for a $15 billion package of short-term loans for U.S. automakers taken from the Dept. of Energy “retooling” loan program already signed into law.   (Few recall that Congress already passed a $25 billion loan program for the automakers in September.)

*       Includes a provision that would ALLOW the government to demand early repayment of the loans if the firms were not making adequate progress toward reinventing themselves. This is an option, not mandatory.

*       Allows the President to choose whether to appoint a single administrator — referred to as a “car czar” — or a board of Cabinet officials to oversee the loan program. 

*       Speaker Pelosi has conceded to WH demands that any bailout come from an Energy Dept. loan program already passed for the auto industry, not TARP.  However, she has stated that the bill must specifically include provisions to replenish the retooling program -- and do so within weeks.   Furthermore, she's been quite vocal about her expectation that Congress will have to send additional funds to Detroit in the new year.  Speaker Pelosi hasn't hidden the fact that she considers this just a first step in Detroit's bailout.

*       Speaker Pelosi wants the package to include a provision prohibiting the Big Three from opposing state fuel emissions rules.  Basically, they'd have to drop their lawsuits in CA and elsewhere against state emissions laws that require the automakers to meet standards that are certainly not cost effective and often not even technologically feasible.                                                                                      

Senate Republicans are right to question the plan's ability to put the Big Three automakers on a viable, sustainable path that protects the taxpayer’s investment. The underlying problem in all this is that the law already provides for judicial oversight of such matters in the bankruptcy courts.  What is being proposed here is that the government make special concessions to the auto industry to walk them through a special bankruptcy program administered by a 'car czar,' rather than a judge as in a normal bankruptcy case. Our government will have a controlling stake in yet another significant portion of our economy.

I understand that our nation’s auto companies are hurting, but the last thing these companies and our economy need is a multi-billion-dollar bailout that does nothing to reform the failing business model that put them in this position in the first place.

For instance, GM is drowning under the high costs of their employee benefits. Due to the negotiation of long-term retirement and health packages, GM currently supports more retired employees than present employees. Because American automakers’ costs are so much higher than their competitors- an estimated $2000 more per car- their competitors are able to put in more extras without pricing their products out of the market. It's not that no Americans are buying cars; it's that foreign companies are producing cars that Americans want to buy.

Senator Voinovich, an Ohio Republican who has been a strong advocate for an auto industry rescue, summed up our concerns over the proposed plan the best:“One of my concerns is that this bill doesn’t go far enough to secure viability plans from the auto companies that would best ensure that the money will be paid back to the taxpayers."

I'll keep you posted as things develop throughout the day and week.