More job cuts loom as economy slows

NEW YORK (CNNMoney.com) -- The number of job cuts announced in September rose as the economy slowed, according to a report released Wednesday.

Positions on the cutting board rose 7.2% to 95,094 from 88,736 the previous month, and were 33% higher than the same month last year, when 71,739 cuts were announced, according to outplacement consultancy Challenger, Gray & Christmas, Inc.

September brought the announced layoff total for the third quarter to 287,142 - the largest number since 2005, according to the report.

The computer industry was the hardest hit, with 25,715 positions on the line after PC maker Hewlett-Packard (HPQ, Fortune 500) announced the largest workforce reduction of the year, the report said.

HP said it would cut 24,600 jobs worldwide as a result of its acquisition of Electronic Data Systems Corp. But since those cuts were a result of the deal and not a consequence of the ailing economy, the report noted, HP's workforce could gain many of those jobs back.

The struggling auto industry came in second place, with plans to drop 14,595 jobs, while the apparel industry came in third place, announcing 8,350 cuts, according to the report.

Surprisingly, planned job cuts were relatively modest in the financial sector, the report said, despite the turmoil that plagued the nation's financial institutions during the month.

Banks wait for bailout

The data showed that finance industry had announced 8,244 job cuts in September, compared with a spike of 27,169 during the same month last year as the credit crunch began to unfold. But they did jump from 2,182 in August.

September saw a major reshaping of the financial landscape as institutions such as Lehman Brothers, Merrill Lynch (MER, Fortune 500), AIG (AIG, Fortune 500), Wachovia (WB, Fortune 500) and Washington Mutual were acquired, bailed out, or went bankrupt.

"While all of these scenarios are being played out, the fate of the workers remains in limbo," John A. Challenger, chief executive of Challenger, Gray & Christmas said in a statement.

Financial institutions are waiting to see if Congress passes the Bush administration's $700 billion rescue plan that would allow the government to buy up tainted assets in order to keep their businesses from failing.

Whether the bailout plan is approved by Congress - and what form it takes - will affect the number of layoffs that may eventually be announced, according to Challenger.

"One of the big questions is: Are there going to be more runs on banks and financial institutions?'" he told CNNMoney.com.

If there is no bailout plan, financial job cuts will likely increase, according to Challenger. On the other hand, if all banks take advantage of the government's offer, the number of layoffs could be limited, since no one institution is singled out.

But if a bailout plan passes and is only embraced by a few institutions, that would emphasize the weakness of those companies, and we might see more job cuts, he added. 


Americans want bailout - worry over cost
Private sector cuts 33,000 jobs

Good month for construction

WASHINGTON (AP) -- Construction activity was unchanged in August even though spending for residential projects posted the first increase in 17 months, a rare bit of good news in the midst of the worst housing downturn in decades.

The Commerce Department on Wednesday said construction activity was flat in August, a better-than-expected outcome than the 0.5% fall that economists expected.

The big surprise was a 0.3% rise in residential activity, the first increase in housing activity since March 2007.

It was only the second monthly rise for housing in the past 29 months, a prolonged period of distress when the industry has been battered by slumping sales, falling prices and soaring mortgage defaults.

The tidal wave of mortgage defaults also has rocked the financial industry, leaving banks saddled with billions of dollars in bad debt and triggering a severe credit crunch as they have become fearful of making new loans.

To try to unfreeze credit markets, the Bush administration is pushing Congress to approve the biggest bailout in history, a measure to allow the government to buy up to $700 billion in bad mortgage loans and mortgage-backed securities from banks as a way to get them to resume more normal lending.

The House defeated the original proposal on Monday but the administration and congressional leaders have been scrambling to get the proposal back on track. The Senate is expected to vote on it Wednesday evening.

The performance in August for overall construction was better than the decline analysts expected. However, the government revised July activity to show a much bigger drop of 1.4%, compared to the 0.6% decline initially reported.

The 0.3% increase in housing left spending in this area at a seasonally adjusted annual rate of $343.6 billion. The gain was offset by a 0.8% drop in spending on nonresidential projects, which fell to $415.95 billion.

The concern is that the severe credit crunch will cause banks to shut off lending for commercial projects, further deepening the economy's problems.

Spending on government projects rose by 0.8% to a record $312.5 billion at a seasonally adjusted annual rate, with both state and local governments and federal projects at all-time highs. 


Construction spending lowest in 7 years

Senate passes bailout

NEW YORK (CNNMoney.com) -- The Senate on Wednesday night passed a sweeping and controversial financial bailout similar in key ways to one rejected by the House just two days earlier.

The measure was passed by a vote of 74 to 25 after more than three hours of floor debate in the Senate. Presidential candidates Sens. Barack Obama, D-Illinois, and John McCain, R-Arizona, voted in favor.

Like the bill the House rejected, the core of the Senate bill is the Bush administration's plan to buy up to $700 billion of troubled assets from financial institutions.

Those assets, mostly mortgage-related, have caused a crisis of confidence in the credit markets. A major aim of the plan is to free up banks to start lending again once their balance sheets are cleared of toxic holdings.

But the Senate legislation also includes a number of new provisions aimed at Main Street.

The changes are intended to attract more votes in the House, in particular from House Republicans, two-thirds of whom voted against the bailout plan.

The House is expected to take up the Senate measure for a vote on Friday, according to aides to Democratic leaders.

The legislation, if passed by the House, would usher in one of the most far-reaching interventions in the economy since the Great Depression.

Advocates say the plan is crucial to government efforts to attack a credit crisis that threatens the economy and would free up banks to lend more. Opponents say it rewards bad decisions by Wall Street, puts taxpayers at risk and fails to address the real economic problems facing Americans.

"If we do not act responsibly today, we risk a crisis in which senior citizens across America will lose their retirement savings, small businesses won't make payroll ... and families won't be able to obtain mortgages for their homes or cars," said Senate Majority Leader Harry Reid, D-Nev., moments before the vote.

In a press briefing after the vote, Senate Minority Leader Mitch McConnell. R-Ky., said, "This is a measure for Main Street, not Wall Street. [It will help] to unfreeze our credit markets and get the American economy working again."

Because of Senate add-ons, the bill's initial price tag will be higher than the $700 billion that the Treasury would use to buy troubled assets. But over time, supporters say, taxpayers are likely to make back much if not all of the money the Treasury uses because it will be investing in assets with underlying value.

How the Senate bill differs

The package adds provisions to the House version - including temporarily raising the FDIC insurance cap to $250,000 from $100,000. It says the FDIC may not charge member banks more to cover the increase in coverage. But that doesn't prevent the agency from raising premiums to cover existing concerns with the insurance fund, according to Jaret Seiberg, a financial services analyst at the Stanford Group, a policy research firm.

Instead, the bill allows the FDIC to borrow from the Treasury to cover any losses that might occur as a result of the higher insurance limit.

The bill also adds in three key elements designed to attract House Republican votes - particularly popular tax measures that have garnered bipartisan support.

It would extend a number of renewable energy tax breaks for individuals and businesses, including a deduction for the purchase of solar panels.

The Senate bill would also continue a host of other expiring tax breaks. Among them: the research and development credit for businesses and the credit that allows individuals to deduct state and local sales taxes on their federal returns.

In addition, the bill includes relief for another year from the Alternative Minimum Tax, without which millions of Americans would have to pay the so-called "income tax for the wealthy."

The debate over extending AMT relief is an annual political ritual. It enjoys bipartisan support but deficit hawks on both sides of the aisle contend the cost of providing that relief should be paid for. Others argue it shouldn't be paid for because the AMT was never intended to hit the people the relief provisions would protect. Nevertheless, lawmakers pass the measure every year or two.

How Senate bill mimics House version

For all the sweeteners added to the Senate bill, however, it is similar to the House bill in many key ways.

The core is the Treasury's proposal to let financial institutions sell to the government their troubled assets, mostly mortgage-related. And as in the House bill, the Senate would only allow the Treasury access to the $700 billion in stages, with $250 billion being made available immediately.

The Senate bill is also similar in that it includes a number of provisions that supporters say would protect taxpayers. One would direct the president to propose a bill requiring the financial industry to reimburse taxpayers for any net losses from the program after five years. And the Treasury would be allowed to take ownership stakes in participating companies.

Like the House version, the Senate bill includes a stipulation that the Treasury set up an insurance program - to be funded with risk-based premiums paid by the industry - to guarantee companies' troubled assets, including mortgage-backed securities, purchased before March 14, 2008.

And it would place curbs on executive pay for companies selling assets or buying insurance from Uncle Sam. One provision: Any bonus or incentive paid to a senior executive officer for targets met would have to be repaid if it's later proven that earnings or profit statements were inaccurate.

Lastly, the Senate version would set up two oversight committees. A Financial Stability Board would include the Federal Reserve chairman, the Securities and Exchange Commission chairman, the Federal Home Finance Agency director, the Housing and Urban Development secretary and the Treasury secretary.

A congressional oversight panel, to which the Financial Stability Board would report, would have five members appointed by House and Senate leadership from both parties.

Differing views

Despite the Senate bill's sweeteners, the bill did not garner unanimous support because those who oppose the Treasury plan felt passionately it was the wrong approach.

Sen. Maria Cantwell, D-Wash., a champion of the energy tax breaks in the bill, said on Wednesday afternoon she nevertheless would vote against the bill because she opposes "giving the keys to the Treasury over to the private sector."

Opponents of the bill have said they resented being given a "my way or the highway" choice to address what they acknowledge is a very serious economic threat.

During the Senate debate on Wednesday, Sen. David Vitter, R-La., characterized the administration's request to lawmakers 12 days ago as "crying 'Fire!' in a crowded theater, then claiming the only [way out] is to tear down the walls when there are many exit doors."

Sen. Richard Shelby, R-Ala., said the Senate will have "failed the American people" by acting hastily. "I agree we need to do something. ... [But] we haven't spent any time figuring out whether we've picked the best choice."

Supporters of the bill say they hate the position they are in and are angry, too, but say it's better to do something now than to let the credit crunch persist.

"There's no doubt that there may be other plans out there that, had we had two or three or six months to develop ... might serve our purposes better," said Obama during the floor debate. "But we don't have that kind of time. And we can't afford to take a risk that the economy of the United States of America and, as a consequence, the worldwide economy could be plunged into a very, very deep hole."

Potential costs

The tax provisions of the Senate bill - the bulk of which come from the addition of tax breaks from other legislation - may reduce federal tax revenue by $110 billion over 10 years, according to estimates from the Joint Committee on Taxation. More than half of that is due to the 1-year extension of AMT relief.

The Congressional Budget Office said it cannot estimate the net budget effects of the troubled asset program because of the many unknowns about that piece of the bill.

However, the agency noted in a letter to lawmakers on Wednesday, it expects the program "would entail some net budget cost" but that it would be "substantially smaller than $700 billion."

Overall, the CBO said, "the bill as a whole would increase the budget deficit over the next decade."

All eyes on House

Now the fate of the bailout rests with the House.

"The reality has hit some members," said House Financial Services Chairman Barney Frank, D-Mass., late Wednesday on CNN. "The main change is reality - it's not possible now to scoff at the predictions of doom if we don't do anything."

The lead House Republican, Rep. John Boehner, R-Ohio, was consulted on the Senate's plans and gave his "green light," spokesman Kevin Smith said. "We believe we'll have a better chance to pass this bill than the one that failed [Monday]," he added.

The plan could attract House Republicans while simultaneously alienating bailout supporters among the Democrats because the tax cuts in the revenue bill aren't offset by spending cuts or increased revenues.

President Bush, following the Senate vote, said the bill was central to the "financial security" of the nation. "The American people expect - and our economy demands - that the House pass this good bill this week and send it to my desk."

- CNN's Jessica Yellin, Deirdre Walsh and Ted Barrett contributed to this story. 


Rescue bill unveiled
Bailout: Senate to vote Wednesday

FDIC wants to boost deposit limits

NEW YORK (CNNMoney.com) -- The federal agency that guarantees bank deposits is asking Congress for temporary authority to raise the limit on the amount of money it insures for individual bank accounts.

Federal Deposit Insurance Corp. Chairman Sheila Bair put out a statement late Tuesday afternoon asking that Congress allow her agency to increase the $100,000 limit per account that has been in place since 1980.

"Unfortunately, there is an increasing crisis of confidence that is feeding unnecessary fear in the marketplace," Bair said. "To address this crisis of confidence, I do believe that it would be helpful for the FDIC to have the temporary ability to raise deposit insurance limits."

Bair did not say what she thought the new limit should be. FDIC spokesman Andrew Gray said simply, "We'll leave that to Congress."

In 2005, Congress approved having the deposit insurance limit pegged to inflation. But that annual increase won't start until 2011 under current law.

The FDIC's request comes less than a week after two of the nation's largest banking institutions essentially collapsed and as investors worry about more bank failures.

Washington Mutual, the nation's largest savings and loan, became the largest bank failure of all time Sept. 25. None its depositors lost any of their money though as the FDIC arranged a sale to JPMorgan Chase (JPM, Fortune 500).

Monday Wachovia Corp. (WB, Fortune 500), the nation's No. 4 bank holding company by assets, sold its banking assets to Citigroup (C, Fortune 500) for a fire sale price in a transaction brokered by the FDIC.

Raising the amount that the FDIC can insure could stem a potential run on deposits by bank customers, particularly businesses, who fear losing their money. The $100,000 limit protected as much as 82% of deposits in 1991 but only covers 63% of deposits today.

The change in the $100,000 cap will be of particular benefit to small businesses, many of which use bank accounts to hold money for pay salaries and operations. The FDIC insures up to $250,000 in individual retirement accounts.

The idea of raising the limits had already drawn support earlier in the day from Democratic presidential candidate Barack Obama and his Republican rival, John McCain. 


10th bank failure of 2008

Leave now - or risk getting laid off?

NEW YORK (Fortune) -- Dear Annie: I work for Hewlett-Packard (HPQ, Fortune 500), which, as you probably know, is planning to lay off more than 24,000 people worldwide over the next three years. It seems that most of those on the chopping block are employees who came along with HP's acquisition of EDS. Since I happen to be in that group, I wonder if I should leave now, or wait and see what happens. On the one hand, I like it here, and my immediate boss has told me that he sees a great future for me at HP, so I should "just sit tight." On the other hand, I have two other job offers, one that came from a recruiter, and another from a former EDS colleague who left before the merger. Any advice on what to do? -Dangling Man

Dear Dangling: "Even when you see it coming way in advance, getting laid off is a terrible kick in the gut," says Susan Joyce, who runs employment portal Job-Hunt.org (http://www.job-hunt.org/), and who is herself a layoff survivor. "You're far better off leaving on your own terms."

It's nice that your boss believes you'll be spared the ax but, says Joyce, "I wouldn't depend on that reassurance. Often bosses, with the best will in the world, encourage people to stick around. But things change."

Indeed they do, especially over the course of three years. Joyce's erstwhile employer, Digital Equipment Corp., was once the world's No. 2 computer company. (DEC was later bought by Compaq, which has since been absorbed by - that's right - Hewlett-Packard.) DEC started running into trouble in the late '80s and began letting people go in 1991. Joyce didn't get the sack until 1994, and now wishes she had left sooner.

"When you stay until the bitter end, potential employers think you are 'damaged goods,' in other words, that you stuck around because you couldn't find anywhere else to go," she notes. "Besides, while you're being loyal to your current employer, you'll end up getting stuck with all the work the laid-off people would have been doing."

Moreover, you're fortunate enough to have two other offers already. Let's say you take your boss at his word and stay - and, a year or two from now, he gets laid off and so do you. Are the two other jobs you're mulling now likely still to be available?

For anyone who faces this dilemma without any job offers in hand, Joyce has written a handy (and free) e-book, Job-Hunt's 15 Minute Guide to Layoff Self-Defense: Six Steps to Protect Yourself and Your Income. "Once your employer has stated that people will be laid off, your first priority has to be to protect yourself and your future," Joyce says. "Start figuring out your next move right away." A few tips on how to get started:

Set up your own private channels of communication. Try to keep your job search as quiet as you can, or you may end up getting fired before the layoffs even start. "Employers don't like, or trust, job seekers on staff," observes Joyce.

You need your own personal e-mail account and cellphone - not the ones issued to you by your current employer - so other employers, and networking contacts, can reach you privately. Also, do bring your resume up to date - but do it at home, not on your employer's computer. Sounds obvious, but you'd be surprised.

Have business cards printed with your private contact information on them, with no mention of where you work now. Instead of including your home address, use a generic regional description like "Boston, MA area." Hand out these cards to co-workers and ask them for their private contact information as well, so you can stay in touch once the layoffs get underway -- but don't disclose details of your job search.

Expand your online presence, cautiously. Register your name as a domain name (including your maiden name if you are a woman using a married name). This could be an important part of your online branding, and it only costs $9.95 at GoDaddy.com. Set up a LinkedIn, ZoomInfo, or Ziggs profile, or all three.

"LinkedIn is particularly good for collecting recommendations, and writing them for others," says Joyce. "However, be careful about selecting 'Career opportunities' in your contact preferences." Likewise, don't post your resume on job boards unless you've cloaked it to conceal your identity.

Network, network, network. "Check in with your college, grad school, or even high-school career center to see what services they offer," suggests Joyce. "Often, free or low-cost assistance includes career counseling and resume help. You should also ask for an alumni directory and a schedule of alumni events."

At the same time, use Google and social networking sites like LinkedIn and Facebook to track down former colleagues from previous jobs. Job-Hunt.org features a large directory of corporate "alumni" groups that may be helpful, at www.job-hunt.org/employer_alumni_networking.shtml.

"Go to professional organization meetings and events, including college reunions," says Joyce. "If anyone at work asks why you're suddenly getting more active in this regard, say that it's good for business - that is, your current employer's business." (Well, it really is, so that's no lie. What else it may be good for is no one else's beeswax.)

"The importance of networking outside your company can't be overstated," says Joyce. "One of the mistakes many of us made at DEC was, we did a lot of internal networking with people in marketing, manufacturing, consulting, all over the company. That was great for getting our jobs done, but we neglected the external networking we should have been doing. So when we got laid off, we didn't know anybody except each other - and we were all in the same boat."

Readers, what do you say? What should employees facing a layoff threat do and what should they avoid at all costs? Ever jumped ship in advance of a layoff - or stayed on board too long? Post your thoughts on the Ask Annie blog. 


Decoding Obama’s tax claim

Bailout: Senate to vote Wednesday

NEW YORK (CNNMoney.com) -- The Senate plans to vote on the $700 billion bank rescue plan Wednesday evening - two days after the House failed to pass it.

The bill adds new provisions - including raising the FDIC insurance cap to $250,000 from $100,000 - and will be attached to an existing revenue bill that the House also rejected Monday, according to several Democratic leadership aides.

The vote is scheduled for after sundown, in observance of Rosh Hashanah. Republican presidential nominee John McCain and Democratic nominee Barack Obama and his running mate Joe Biden confirmed that they would be present for the vote.

Senate Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., announced the plan Tuesday.

"Senate Democrats and Republicans believe it is essential that we work quickly on this important legislation to restore confidence to our financial system and strengthen the economy," Reid said in a statement.

White House spokesman Tony Fratto said the administration welcomes the "modified bill" and the scheduled vote.

Democratic sources told CNN that they expect bipartisan support.

Earlier Tuesday, Federal Deposit Insurance Corp. Chairman Sheila Bair asked Congress to allow her agency to increase the $100,000 limit per account that has been in place since 1980. To do so would help restore confidence in the markets, she said. Bair did not say what she thinks the new limit should be.

The revised bailout bill also includes a "Mental Health Parity" provision, which would require health insurance companies to cover mental illness at parity with physical illness.

Because the bill must originate in the House, the Senate is attaching the rescue plan to a bill that deals with renewable energy tax incentives. This would allow the Senate to vote before the House.

House Speaker Nancy Pelosi, D-Calif., said that House leaders are discussing ideas offered by other lawmakers about how to modify the bill defeated on Monday. "House Democrats remain strongly committed to a comprehensive bill that stabilizes the financial markets, restores confidence, and protects taxpayers," she said.

Round 1 failed

The bailout package, a collaboration of Treasury Secretary Henry Paulson and leaders from both parties, was rejected by the House in a 228-205 vote Monday. Two-thirds of Republicans and about one-third of Democrats voted against the bill.

Following the defeat, the Dow Jones industrial average dropped 777 points, its biggest one-day point decline ever. The decline of nearly 7% was the largest percentage decline since the Black Monday crash of 1987.

But stocks rallied Tuesday, with the Dow jumping 485 points on bets that Congress will pass a version of the government's $700 billion package.

The bill, if approved, would allow the federal government to buy troubled mortgage-related investments from financial institutions, freeing them up for lending in a bid to pull the economy out of its credit freeze.

Proponents of the bill believe it would prevent the United States from sliding into a serious financial crisis, but opponents saw it as an unbearable burden to taxpayers and a rescue for Wall Street.

The Bush administration and key lawmakers had regrouped on Tuesday and vowed to push ahead. "Unfortunately, the measure was defeated by a narrow margin," President Bush said in a brief televised address at the White House. "I'm disappointed by the outcome, but I assure our citizens, and citizens around the world, that this is not the end of the legislative process."

The House is adjourned and not scheduled to return to session until Thursday at noon.

Bush pushed hard for lawmakers to act. "Our economy is depending on decisive action from the government," he said. "The sooner we address the problem, the sooner we can get back on the path of growth and job creation. This is what elected leaders owe the American people, and I am confident that we'll deliver."

On Tuesday, Bush spoke to Obama and McCain about the financial crisis, according to Fratto. The presidential candidates "offered ideas and reaffirmed what they have said publicly - that this is a critical issue that needs to be addressed," Fratto said.

CNN's Jessica Yellin and Ted Barrett contributed to this story.  


House passes drilling bill

Senate passes $634B spending bill

WASHINGTON (AP) -- Automakers gained $25 billion in taxpayer-subsidized loans and oil companies won elimination of a long-standing ban on drilling off the Atlantic and Pacific coasts as the Senate passed a sprawling spending bill Saturday.

The 78-12 vote sent the $634 billion measure to President Bush, who was expected to sign it even though it spends more money and contains more pet projects than he would have liked.

The measure is needed to keep the government operating beyond the current budget year, which ends Tuesday. As a result, the legislation is one of the few bills this election year that simply must pass. Bush's signature would mean Congress could avoid a lame-duck session after the Nov. 4 election.

White House spokesman Tony Fratto said the bill "stands as a reminder of the failure of the Democratic Congress to fund the government in regular order." But, he said, it "puts the United States one step closer to ending our dependence on foreign sources of energy" by lifting the offshore drilling ban and opening up huge reserves of oil shale in the West.

The Pentagon is in line for a record budget. In addition to $70 billion approved this summer for operations in Iraq and Afghanistan, the Defense Department would receive $488 billion, a 6 percent increase. The spending bill also offers aid to victims of flooding in the Midwest and recent hurricanes across the Gulf Coast.

Such a huge bill usually would dominate the end-of-session agenda on Capitol Hill. But it went below the radar screen because attention focused on the congressional bailout of Wall Street.

The measure settles dozens of battles that have brewed for months between the Democrats who run Congress and the White House and its GOP allies.

The administration won approval of the defense budget. Democrats wrested concessions from the White House on $23 billion for disaster-ravaged states, a doubling of low-income heating subsidies, and smaller spending items such as $24 million more for food shipments to the elderly.

The loan package for automakers would reward them with $25 billion in below-market loans, costing taxpayers $7.5 billion to subsidize the retooling of plants and development of technologies to help U.S. carmakers to build cleaner, more fuel efficient cars. Companies would not have to begin repaying the loans for five years, drawing objections from Sen. Jon Kyl, R-Ariz., who predicted they would return for more help when the money is due.

Republicans made ending the coastal drilling ban a central campaign issue this summer as $4-plus per gallon gasoline stoked voter anger and turned public opinion in favor of more exploration.

The action does not mean drilling is imminent and still leaves the oil-rich eastern Gulf of Mexico off limits. But it could set the stage for the government to offer leases in some Atlantic federal waters as early as 2011.

Also in the bill is money to avert a shortfall in Pell college aid grants and solve problems in the Women, Infants and Children program delivering healthy foods to the poor.

In addition to the Pentagon's budget, there is $40 billion for the Homeland Security Department and $73 billion for veterans' programs and military base construction projects. Combined with the Defense Department's spending, that amounts to about 60 percent of the budget work Congress must pass each year.

Democrats came under criticism from the GOP for short-circuiting the normal process for a spending bill after it became clear that Republicans would force difficult votes on the drilling ban.

Democrats also wanted to avoid an election-year clash with Bush that would have played in his favor. They are willing to take their chances that Democrat Barack Obama will be elected president in November and permit increases for scores of programs squeezed by Bush each year.

Bush had threatened to veto bills that did not cut the number and cost of pet projects in half or cause agency operating budgets to exceed his request. Democrats ignored the edict as they drafted the plan and the White House has apparently backed down.

Taxpayers for Common Sense, a watchdog group, discovered 2,322 pet projects totaling $6.6 billion. That included 2,025 in the defense portion alone that cost a total of $4.9 billion. Critics of such projects are likely to discover numerous examples of links to lobbyists and campaign contributions. 


House vote expected on oil drilling
House passes drilling bill