Key Tax Breaks at Risk as Panel Looks at Cuts

In just a few weeks a deficit commission is planning to submit recommendations for balancing the federal budget by 2015. Experts predict that they will recommend getting rid of a handful of popular tax breaks including the mortgage interest deduction. Although they are popular among American taxpayers, the tax incentives reportedly cost the government about $1 trillion a year.

The Wall Street Journal reports

At stake, in addition to the mortgage-interest deductions are child tax credits and the ability of employees to pay their portion of their health-insurance tab with pretax dollars. Commission officials are expected to look at preserving these breaks but at a lower level, according to people familiar with the matter.

The officials are also looking at potential cuts to defense spending and a freeze on domestic discretionary spending. It is unclear if the 18-member panel will be able to reach an agreement on any of the items by a Dec. 1 deadline.

Even if they do reach an agreement, any curbs on current tax breaks would likely face tough sledding in Congress. The banking and real-estate lobbies have fiercely rebuffed efforts to rescind the mortgage-interest deduction in the past.

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Hawaii Cuts Payments to the Temporarily Disabled

Like many other States in the country, Hawaii has been trying to make budget cuts where they can. However, their latest cut of payments to the temporarily disabled has thousands of Hawaiians in an outrage. Several prominent local authorities, such as Senator Suzanne Chun, are speaking out against the cuts saying they will leave many helpless, homeless, and hopeless. You can find the clip of an article discussing this recent development courtesy of the Associated Press below.

Right when more people need welfare, they're getting less from Hawaii's government.

Monthly payments to poor, temporarily disabled people fell by one-third this week, from $450 to $300, because more people are drawing benefits from the same pool of money.

State lawmakers met at the Hawaii Capitol on Wednesday to try and find more money for the program, and they questioned how government could shortchange these 5,055 people when they may have no other income.

"That money won't cover the rent anymore, so many of them will go homeless," said Sen. Suzanne Chun Oakland, D-Kalihi-Liliha.

This money, called general assistance, goes to people without dependent children who are unable to work because of a temporary disability. To qualify, they must have little or no income and can't get other federal assistance.

"What will happen in our aloha state to those who are most needy?" asked Alex Santiago, executive director of a group of nonprofits called PHOCUSED, which stands for Protecting Hawaii's Ohana, Children, Underserved, Elderly and Disabled. "This is their last hope. There has to be an alternative."