Photo credit: The Memphis Flyer

A report out today from the Democrats on the House Appropriations Committee shows costly new flaws in Congress’ approach to fiscal policy. Beyond providing updated information on the anticipated impacts to specific programs from the across-the-board spending cuts known as sequestration, the report shows Congress’s piecemeal approach to “fixing” sequestration is more than just unfair – it’s costing the U.S. more money.

Since the threat of sequestration failed to spark a spending compromise and the haphazard slashing began, lawmakers have faced uneven amounts of pressure to replace chunks of sequestration cuts from varying groups. The success of that pressure seems to hinge on the political influence wielded by the group affected by a given cut. Unemployment beneficiaries, Head Start students and parents, 140,000 families on housing assistance, and seniors who rely on Meals on Wheels, among many other politically marginalized groups, have received no relief from sequestration.

Business travelers, on the other hand, have seen their outcry over airport delays due to sequestration yield a “fix” for the Federal Aviation Administration.

Today’s report goes beyond that unfairness to explain how the piecemeal “fix” to avert flight delays is actually raising the economic costs of aviation delays, by tens of billions of dollars:

The [Reducing Flight Delays] Act [of 2013] allowed the FAA to apply sequestration to the Airport Improvement Program (AIP), which had been exempt in the original sequestration order. […]

Cutting the AIP program slows FAA’s ability to meet construction needs. FAA estimates that development needs at eligible airports will exceed $42.5 billion over the next five years. The American Society of Civil Engineers 2013 “Report Card for America’s Infrastructure” rated our aviation system a “D,” estimating that the cost of congestion and delays to the economy will rise to $34 billion in 2020 (up from $22 billion in 2012), and that “D” grade assumes we continue to spend at current funding levels — before sequestration.

Even before Congress gave the FAA permission to halt all airport construction funding, America faced a $12 billion increase in the economic drag caused by aviation congestion. Now that cost is going to swell.

These can-kicking costs come on top of the more immediate damage sequestration will do to the economy: 700,000 fewer jobs and a 0.6 percentage-point reduction in GDP growth for the year. The Huffington Post reported several of the mechanical details of individual agency responses to the cuts contained in today’s House report, including 500 fewer firefighters at the Forest Service and a shrunken stockpile of vaccines at the Centers for Disease Control and Prevention.

Income inequality around the world increased more during the financial crisis that it did in the previous 12 years, according to new data from the Organisation for Economic Cooperation and Development (OECD) released on Wednesday. The United States has one of the largest gaps along with Chile, Mexico, Turkey, and Israel. The top 10 percent of the income scale fared better than the poorest 10 percent in 21 out of 33 countries.

In the United States, the top 10 percent of the income distribution had 15.9 times the income at of the bottom 10 percent in 2010, compared to 9.8 times for the OECD on the whole. The U.S. also has a higher Gini coefficient – a measurement of a country’s income inequality – and a higher share of the population living on less than half the median income.

But there is a silver lining: The numbers would look much worse without social spending. Nearly a third of the country’s population would be living on less than half of the median income without the social safety net, but taking it into account drops that number to 17.4 percent. The Gini coefficient also falls significantly, proving that social spending is doing a lot to bring down income inequality.

That could change as the U.S. continues to cut government spending. The report “warns that further social spending cuts in OECD countries risk causing greater inequality and poverty in the years ahead.” The U.S. is set to cut $1.5 trillion in spending over the next decade, and new CBO numbers show that the deficit has dramatically dropped thanks in part to falling public spending.

While much of the attention currently focused on the Internal Revenue Service (IRS) surrounds the agency’s acknowledgement that non-profit groups using tea party keywords were targeted for extra scrutiny in 2012, technologist cum data liberator Carl Malamud is campaigning to convince the IRS to make it easier to track money and influence in non-profits.

Fresh off of a victory liberating the District of Columbia Code, Malamud’s Public.Resource.Org is on to a new transparency fight: Getting the IRS to release public financial records about non-profits in a useful format. In a memo last month, the organization noted that despite having Form 990 financial information about many non-profits in a machine-readable digital format, the IRS will only release the data in PDF form:

As you know, Public.Resource.Org has expended considerable effort to try to make the Form 990, the Public Reports of Nonprofit Corporations, more broadly available on the Internet. We’ve posted 6,821,105 PDF files, including all publicly released documents from 2002 to the present. Although all large nonprofits are required to e-file their returns, and many smaller nonprofits elect to do so, the IRS has not released the machine-processable e-file information, and has chosen instead to image the data onto forms and release the information as bitmap images, equivalent to a scan of a paper document.

If the documents were released in a machine-processable format, it would be much easier to analyze and see larger patterns across the non-profit sector. This could be particularly useful in understanding how dark money is being channeled through 501(c)(4) “social welfare group” non-profits engaged in political advocacy who aren’t required to disclose their donors, but are required to file a Form 990 with basic financial information.

Dark money exploded following the 2010 Citizens United v. FEC ruling that allowed outside groups to make unlimited political expenditures. While 501(c)(4) groups are allowed to engage in some political activity and still maintain tax-exempt status, electioneering is not supposed to be their primary activity. However, dark money groups combined to spend $416 million on the 2012 election — 37 percent of all money spent by independent, non-party outside groups.

The White House announced an executive order aimed at making “open and machine readable” the default for newly created government data last week. However, as Malamud noted in a statement to ThinkProgress, that order will not by itself resolve the IRS situation:

The new executive order on “Making Open and Machine Readable the Default for Government Information” is a good first step. But, it is important that we remember that we need to do more than set out principles for new government databases and web sites, we need to fix the ones we already have on-line. Some of our existing databases, such as the federal procurement database or the IRS form 990s, are in bad shape and are crucial economic engines, affecting not only the operation of government, but large sectors of the economy that depend on this information to operate efficiently and transparently.

If we’re serious about creating jobs and making our economy grow, government data is important part of making that happen. When the US Patent Office, for example, started to release machine-redable data for US Patents, that information became immediately more useful. Likewise, when the SEC started releasing information on public corporations in their EDGAR database, our markets became more transparent and more accessible.

Note: ThinkProgress is a project of the Center for American Progress Action Fund (CAPAF), which has been recognized by the IRS as a 501(c)(4) organization. CAPAF does not endorse candidates, nor does it fund “independent expenditures” or any other kind of candidate-related advertising.

Two weeks after announcing a record high unemployment rate, Europe’s official economic analysts today revealed another first for the currency union: The Eurozone’s ongoing recession is now the longest in the 14-year history of the euro. The Guardian notes the European economy has now shrunk a full percentage point over the past year:

The eurozone has slumped into its longest recession ever, after economic activity across the region fell for the sixth quarter in a row. […]

France, Spain, Italy and the Netherlands all saw their economies shrink as the economic crisis in the eurozone continued to hit its largest economies.

Eurostat’s figures showed that the eurozone economy has now contracted by 1% over the last year, putting further pressure on leaders as unemployment climbs to new record highs.

The 0.2% contraction in the first quarter of 2012 was an improvement on the 0.6% drop recorded between October and December, but analysts warned that the eurozone’s economic outlook is darkening.

This is the second ugly bit of record-setting in two weeks, after the Eurozone’s unemployment rate hit 12.1 percent at the end of April. It was the 23rd consecutive month of record-breaking unemployment, with 26.5 million people out of work.

These records seem to have created some space for European policymakers to begin at least discussing an end to austerity. For example, French finance minister Pierre Moscovici reacted to the news that France’s economy had contracted for the second straight quarter by calling for pro-growth policies to return across the Eurozone.

So far, however, the damagingly aggressive reduction in deficits is projected to continue in Europe. And American deficits are now projected to dip even more dramatically than those in Euro countries.

The drop in aggregate Eurozone deficits looks alarmingly similar to the rapid decline in U.S. deficits CBO now projects for 2013. According to European Commission projections for 2013, the countries that use the euro will have cut their combined deficits to 2.9 percent of GDP by the end of the fiscal year, down from 6.4 in 2009. The new CBO figures predict U.S. deficits are shrinking even more dramatically, to 4 percent this fiscal year from over 10 percent in 2009.

In other words, as Europe’s deficit-slashing fever produces a record contraction, American policymakers are learning they’ve outdone their Old World colleagues. But where Europe’s outright contraction may be forcing a policy reversal, slow but steady economic growth in the U.S. seems to be obscuring the lessons from bad headlines across the Atlantic.

After six major European retailers announced on Monday and Tuesday that they would sign onto a broad safety upgrade agreement in Bangladesh, American companies Walmart and Gap announced that they would not sign on. Gap has been the most outspoken about its opposition, reports the New York Times:

By far, Gap has been the most vocal company opposed to the plan, expressing concerns that overzealous American lawyers could seize on the agreement to sue American companies on behalf of aggrieved factory workers in Bangladesh — perhaps in the event of a factory fire. Gap said it supported much of the plan, but it proposed changes that would greatly limit any legal liability for a company that violated the plan.

Walmart cited “requirements, including governance and dispute resolution mechanisms” in the agreement as its reason not to sign on, saying they are “appropriately left to retailers, suppliers and government, and are unnecessary to achieve fire and safety goals.”

The company plans to instead use its own safety plan. It began its own factory inspections of 279 Bangladesh facilities this year after the fire in November that killed 110 and it will release the names and inspection information as well as provide fire safety training for every worker in the factories that produce its goods. The inspection results will be posted on June 1.

Labor groups criticized Walmart’s plan, which is voluntary. The broader plan signed by the other companies is legally binding. Labor groups characterized Walmart’s proposal as merely aspirational.

Meanwhile, documents provided to the New York Times show that Walmart sourced clothing from the collapsed factory that killed 1,127:

The Bangladesh Center for Worker Solidarity has provided The New York Times with photos of several documents not disputed by Wal-Mart that were recovered in the building’s rubble, showing that a Wal-Mart contractor from Canada had produced jeans last year at the Ether Tex factory, which had been situated on the fifth floor of the collapsed Rana Plaza building.

The only American company to sign onto the agreement thus far is PVH, owner of Calvin Klein, Tommy Hilfiger, and Izod. A handful of smaller European companies also signed on Tuesday: Benetton, Marks & Spencer, and El Corte Inglés.

The budget deficit will shrink to its smallest level since before the Great Recession in 2013, and it will continue shrinking through 2015, according to revised estimates from the Congressional Budget Office released Tuesday. In reality, the deficit is even smaller than the CBO predicts, since its “current law” projections assume that funding for the war in Afghanistan and federal disaster relief for states hit by Hurricane Sandy will continue in perpetuity. But that funding isn’t endless, and it will bring the deficit down to even smaller levels.

Still, under CBO’s projections, the deficit is now half as large as it was in 2009, the year President Obama took office:

If the current laws that govern federal taxes and spending do not change, the budget deficit will shrink this year to $642 billion, CBO estimates, the smallest shortfall since 2008. Relative to the size of the economy, the deficit this year—at 4.0 percent of gross domestic product (GDP)—will be less than half as large as the shortfall in 2009, which was 10.1 percent of GDP.

The deficit is shrinking so rapidly because of spending cuts and new revenues and because CBO continues to revise down projected health spending. But that the deficit is shrinking so rapidly isn’t necessarily good news — as U.S. News and World Report’s Pat Garofalo put it, it is instead “one more piece of evidence showing that the economic discussion that has gripped Washington recently is absurdly backwards.”

Despite smaller deficits, congressional Republicans remain focused on spending reductions, and the most recent round of cuts has kicked children out of preschool, left cancer patients without needed screenings, and gutted programs that help low-income Americans in a variety of ways. Those cuts have also threatened to derail the economic recovery, which has sputtered along despite the headwinds created by a consistent focus on deficit reduction. In past recessions, increased government spending has pulled the U.S. to recovery. In this one, it has only made recovery harder.

The crisis the U.S. is facing isn’t the deficit. It’s that the unemployment rate is still 7.5 percent, and more than 4 million of those workers have been off the job for at least six months. A shrinking deficit might be good news in the long-term, but it isn’t putting people back to work or sparking a robust economic recovery. And yet, even with evidence that stimulus policies like the American Jobs Act would help, and despite the fact that the deficit continues to subside, congressional Republicans aren’t just ignoring the devastating impacts of sequestration — they are pushing for even more spending cuts in the immediate future.