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  #1  
Old 08-25-2009, 09:22 PM
doubled doubled is offline
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President's expense account

Everybody knows the president makes $400,000 a year. But according to wikipedia:

"The President earns $400,000 per year, along with a $50,000 monthly expense account, a $100,000 non-taxable travel account and $19,000 for entertainment"

Now what is that $100,000 travel account? Doesn't the president get to fly free on Air Force One where ever he wants? (I assume he doesn't have to use that $100,000 to pay for Air Force One -- obviously $100,000 will not cover the cost of an oversees private jet trip). So why does he need a travel account?
And what's up with that $19,000 entertainment allowance? It seems so out of place. Assuming that's annual, it's actually not that much (I know lots of people who spend $1,500 a month on entertainment) but it seems bizare to break it out as a separate line item rather than simply including it in a salary of $420,000.
And plus, why does the president need an entertainment budget? It's already the most exciting job in the world, plus you live in a mansion with a private bowling alley, swimming pool, movie theater, free concerts by people like Stevie Wonder every single week, famous actors and athletes and authors visiting anytime you ask, etc. What more entertainment does the president need to buy? It's not like he can just take that $19,000 down to the local strip club, right?

And finally, who decided "You know, our president is working too hard -- we should add $19,000 to the budget so he can go out for movie night". That seems like something that would have triggered a populist outcry.

So what's the story about the extra expense budgets?
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Old 08-25-2009, 09:32 PM
kopek kopek is offline
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It is another tradition started by our Founding Father before he became our First President. Don't believe me, hit the library and borrow a copy of George Washington's Expense Account by Marvin Kitman.
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Old 08-25-2009, 09:48 PM
Mahaloth Mahaloth is offline
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Originally Posted by kopek View Post
It is another tradition started by our Founding Father before he became our First President. Don't believe me, hit the library and borrow a copy of George Washington's Expense Account by Marvin Kitman.
Could you explain what you learned from that book a bit more before you get defensive?

Share your knowledge with us, please.
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Old 08-25-2009, 10:07 PM
Ravenman Ravenman is offline
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First of all, the $50,000 is annual, not monthly, expenses, so Wikipedia is wrong again. Here's how the US Code defines the President's compensation:

Quote:
The President shall receive in full for his services during the term for which he shall have been elected compensation in the aggregate amount of $400,000 a year, to be paid monthly, and in addition an expense allowance of $50,000 to assist in defraying expenses relating to or resulting from the discharge of his official duties. Any unused amount of such expense allowance shall revert to the Treasury pursuant to section 1552 of title 31, United States Code. No amount of such expense allowance shall be included in the gross income of the President. He shall be entitled also to the use of the furniture and other effects belonging to the United States and kept in the Executive Residence at the White House. . . .

There may be expended for or on account of the traveling expenses of the President of the United States such sum as Congress may from time to time appropriate, not exceeding $100,000 per annum, such sum when appropriated to be expended in the discretion of the President and accounted for on his certificate solely.
I'm somewhat rusty on travel regulations, but Air Force One is not free for use for the President for any reason he may wish. For example, if he wants to fly to a location for a purely political event, then US tax dollars cannot be used for that purpose. What ends up happening is that either the political event is combined with an official event, or the organizers of the political event have to pay a substantial sum of money for the use of Air Force One. I would imagine that if the President wished to take a vacation with no official duties, he would have to pay at a similar rate.

Similarly, the $19 grand is for official entertainment expenses, not the cost of buying DVDs for the President and his family. This is similar to the $50,000 in expenses, which are also related to official duties. If you meet the President and he gives you a White House t-shirt, it was probably paid from the $50,000 fund; and if you go to a state dinner, the string quartet was probably paid for by the $19,000 fund.
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Old 08-25-2009, 10:17 PM
joebuck20 joebuck20 is offline
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Originally Posted by Ravenman View Post
First of all, the $50,000 is annual, not monthly, expenses, so Wikipedia is wrong again. Here's how the US Code defines the President's compensation:

I'm somewhat rusty on travel regulations, but Air Force One is not free for use for the President for any reason he may wish. For example, if he wants to fly to a location for a purely political event, then US tax dollars cannot be used for that purpose. What ends up happening is that either the political event is combined with an official event, or the organizers of the political event have to pay a substantial sum of money for the use of Air Force One. I would imagine that if the President wished to take a vacation with no official duties, he would have to pay at a similar rate.

Similarly, the $19 grand is for official entertainment expenses, not the cost of buying DVDs for the President and his family. This is similar to the $50,000 in expenses, which are also related to official duties. If you meet the President and he gives you a White House t-shirt, it was probably paid from the $50,000 fund; and if you go to a state dinner, the string quartet was probably paid for by the $19,000 fund.
Still, $19,000 doesn't really seem that much when you figure the cost of entertaining all the dignataries he sees each year. And the cost of a single state dinner where you have more than 100 guests (and are probably feeding them top quality cuts of meat) would probably blow that entire $19,000. In addition the White House hosts a number of parties during the holidays. And by holidays I mean Christmas, Hannukah, Kwanzaa, Ramadan, pretty much any day that holds significance for a major religious or cultural group that time of year. And that's in addition to the parties they host for the press, for members of congress, for his staff, and for any number of groups that hold sway in DC.

Last edited by joebuck20; 08-25-2009 at 10:20 PM..
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  #6  
Old 08-25-2009, 10:23 PM
R. P. McMurphy R. P. McMurphy is offline
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I'm drawing a blank but I read something earlier this year about the expenses that the Presidents and their families rack up in the White House. A long time White House employee said that inevitably every President complains when they get their first bill for personal expenses. Like, "What the hell is this and who spent all this money?"

No, it's not a free ride. The real money is to be made after the President leaves the White House.
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Old 08-25-2009, 10:23 PM
Ravenman Ravenman is offline
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Looking at various laws further, official entertainment expenses of the White House are covered by another appropriation that also includes funds for the heating, renovation, and upkeep of the Executive Mansion of the White House, which for this year is budgeted approximately $13 million. I'm not exactly clear on why there is $19,000 broken out for some official entertainment expenses and other, similar expenses would fall in the other account. I'll try to figure that out tomorrow.
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  #8  
Old 08-26-2009, 01:42 AM
even sven even sven is offline
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There is a great book called Upstairs at the White House written by the man who worked as the Chief Usher for many decades through a half-dozen administrations. It's by no means a tell-all book. Instead, it is a friendly account of what it was like working with the presidents and first ladies and gives a good look at the inner workings of how the White House as an institution is run.

I believe the entertainment account was instituted for Jimmy Carter, who genuinely struggled financially to do the things he was expected to do as president. Official entertainment- such as state dinners- are paid for. But there are many traditional events, such as the welcome dinner for freshman senators, that come out of pocket.

It is true that most presidents are shocked when they receive the bill for their first month in the white house. I believe there are rules about where they can shop, etc. that lead to high food bills.

Presidents also pay for their personal staff- such as personal chefs for daily food, living quarters cleaning staff, etc.
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  #9  
Old 08-26-2009, 01:52 AM
Captain Amazing Captain Amazing is offline
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Quote:
Originally Posted by Mahaloth View Post
Could you explain what you learned from that book a bit more before you get defensive?

Share your knowledge with us, please.
When General Washington was commanding the Continental Army, he said to Congress, basically, "Don't pay me, just give me an expense account." Marvin Kitman's book analyzed Washington's expense account and wrote a book about it, coming to the conclusion that he bilked the hell out of Congress.
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Old 08-26-2009, 03:09 AM
Whack-a-Mole Whack-a-Mole is offline
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Originally Posted by Ravenman View Post
I would imagine that if the President wished to take a vacation with no official duties, he would have to pay at a similar rate.
Curious about this.

Say Obama (just an example, we could do this for any recent President) wanted to go to Hawaii for vacation. No "official" duties.

While Obama makes a good salary a quick Google (and I did not verify this...just popped up and going with it) says Air Force One costs $68,000/hour to fly. Assuming a 600 MPH cruise speed (ignoring takeoff/landing) it is an 8 hour flight or $544,000. I doubt Obama can afford that.

So what does he do? Buy tickets on United?

The Secret Service would have kittens. No freaking way would he be allowed to go anywhere except on official transport.

Mind you when the President goes anywhere there are a LOT more costs involved. The Presidential Limousine goes where he goes (it is flown there, wherever "there" is). Secret Service fly ahead and scout the area and setup security and so on. It is freaking expensive.

I doubt the President taking a vacation has any choice in all that and I seriously doubt the President foots the bill. He'd bankrupt himself just making a few flights.

No one jump on Obama about this. It is what all Presidents have done. Perk of the office if you will. If McCain won he'd be in the same...err...boat. Not about the "man" it is about the office.
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Old 08-26-2009, 03:23 AM
Rigamarole Rigamarole is offline
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Originally Posted by Spartydog View Post
No, it's not a free ride. The real money is to be made after the President leaves the White House.
The real money is from the book sales. Yeah the speaking fees which you are alluding to are hefty as well, but Obama for example has already made many boatloads more full of cash from his book sales than he will ever make as president.
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Old 08-26-2009, 08:43 AM
BKReporter BKReporter is offline
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Originally Posted by Whack-a-Mole View Post
Curious about this.

Say Obama (just an example, we could do this for any recent President) wanted to go to Hawaii for vacation. No "official" duties.

While Obama makes a good salary a quick Google (and I did not verify this...just popped up and going with it) says Air Force One costs $68,000/hour to fly. Assuming a 600 MPH cruise speed (ignoring takeoff/landing) it is an 8 hour flight or $544,000. I doubt Obama can afford that.

So what does he do? Buy tickets on United?

The Secret Service would have kittens. No freaking way would he be allowed to go anywhere except on official transport.

Mind you when the President goes anywhere there are a LOT more costs involved. The Presidential Limousine goes where he goes (it is flown there, wherever "there" is). Secret Service fly ahead and scout the area and setup security and so on. It is freaking expensive.

I doubt the President taking a vacation has any choice in all that and I seriously doubt the President foots the bill. He'd bankrupt himself just making a few flights.

No one jump on Obama about this. It is what all Presidents have done. Perk of the office if you will. If McCain won he'd be in the same...err...boat. Not about the "man" it is about the office.


I could be wrong, but what I've heard is that when he and his family take a personal trip they are each billed the price of a first class ticket, while all the other expenses are covered.
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Old 08-26-2009, 10:16 AM
kopek kopek is offline
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Originally Posted by Mahaloth View Post
Could you explain what you learned from that book a bit more before you get defensive?

Share your knowledge with us, please.

Its nothing to get defensive about. Trust me, my hide is a lot thicker than that; especially when the purpose here (in part) is the exchange of ideas.

Whenever we look at political traditions, we always look first to our First President - George Washington. One of those traditions/myths is that a President (or any great public leader) is "noble" enough to serve for little pay compared to what his value would be on the "open market". The power of the office can be attractive but it isn't financially rewarding until after you have left office.

Horsehockey. I would contend: why argue about your pay when you can pad an expense account and live like a King? If Washington was able to pull it off while running away from the enemy, what's possible for a President today? Or possibly its more a case of "what isn't possible". Washington actually proposed the exact same deal he had had as Commanding General when he became President but Congress had caught on by that time and put limits on it all.

But do those limits, and their modern equivalents, work? The evidence on his Presidential Years hasn't been gathered in the kind of form and detail the War Years were but he seems to have been able to stretch them quite a bit. Making that a natural place to start looking if one is upset about the various expense account items a President today is allowed.
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Old 08-26-2009, 10:34 AM
Ravenman Ravenman is offline
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Again, I'm not an expert on government travel rules, but I believe the rule is as BKReporter relayed it: the cost of non-official travel is supposed to be that of a roughly equivalent airfare on a commercial carrier. For example, if a government official takes his/her spouse on a trip, the spouse has to pay for the flight. But the cost of the flight isn't a percentage of the operating cost of the aircraft, but based somehow upon what a commercial ticket to those locations would cost.
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Old 08-26-2009, 11:23 AM
Bijou Drains Bijou Drains is offline
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Also when the press flies on Air Force One or the press plane they are charged the cost of a normal airline ticket .
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Old 08-26-2009, 02:00 PM
Markxxx Markxxx is offline
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Remember not only does the president have an expense account but his staff has one as well. There are hundreds of ways of moving these expense accounts around to combine monies.

First ladies for instance will garner speaking fees (around $200,000 for a current First Lady) and those are paid in cash upfront. Usually these are legit but many times the first lady gets paid this for merely showing up and introducing the president.

While it's true, AF1 is not used for political events in practice (as the poster noted) it is often combined with a non-political event.

I know from doing cost analysis in private companies, estimated costs are often woefully inflated. Now I don't know about AF1 but I would love to see the books on how they arrive at $68,000 an hour to fly it.

To simplify a bit, the military buys a hammer for $100 , that doesn't mean you can assign that cost to the project. A hammer isn't worth $100 and it doesn't matter what you pay for it, to qualify a project you must assign a REAL value to each portion of the project.

Now I'm not saying that is what AF1 does, I've never seen the breakdown, but I'm just saying when you see projection of cost, keep that in mind, because some people will assign the cost of what they paid for something, instead of it's value or cost. They also do this with salaries. For instance a salaried employee gets paid the same if he works 8 or 10 hours. So there's no additonal real cost. Yet most companies push through an additonal cost. Why? To boots budget and fund allocation, which isn't correct.

Last edited by Markxxx; 08-26-2009 at 02:01 PM..
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  #17  
Old 08-26-2009, 02:54 PM
Ravenman Ravenman is offline
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Originally Posted by Markxxx View Post
First ladies for instance will garner speaking fees (around $200,000 for a current First Lady) and those are paid in cash upfront. Usually these are legit but many times the first lady gets paid this for merely showing up and introducing the president.
Really? I just looked through Bush's and Clinton's tax returns and Laura only got $150,000 in advance fees for a book, and Hillary Clinton got a lot of royalty income from her book over several years, but I can't find anything that shows that a First Lady gets speaking fees. Links.

Where did you learn that First Ladies get speaking fees?
Quote:
While it's true, AF1 is not used for political events in practice (as the poster noted) it is often combined with a non-political event.
No, Air Force One is sometimes used for political events. The RNC compensated the government for about $200,000 in 2002 alone for flights to political events.
Quote:
I know from doing cost analysis in private companies, estimated costs are often woefully inflated. Now I don't know about AF1 but I would love to see the books on how they arrive at $68,000 an hour to fly it. .
The estimates are probably adjusted from this GAO report.
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Old 08-26-2009, 02:58 PM
Chronos Chronos is offline
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To clarify the distinction between an "official" and "political" trip, what would a Town Hall meeting someplace far from Washington (like, say, the one here in Bozeman last week) be considered?
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Old 08-26-2009, 03:09 PM
Ravenman Ravenman is offline
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Official.

If you are familiar with the Hatch Act, which prohibits certain types of political activity by government employees, the President would be under mostly similar restrictions, except for things like he's allowed to use the telephones at the White House to make fundraising calls.

Political events are those related to political campaigns, electioneering, fundraising, and so on. Official events are those which have to do with the job of being President.

ETA: When I say the President is under certain "restrictions," I mean the definition of what is a political act for a government employee is pretty much the same definition of political for the President. However, the President is given leeway to accomplish political acts using official resources (flying AF1, making phone calls from the Oval Office, etc) but reimbursing the government for those costs. I phrased that poorly above.

Last edited by Ravenman; 08-26-2009 at 03:11 PM..
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  #20  
Old 08-26-2009, 03:18 PM
Elendil's Heir Elendil's Heir is offline
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Originally Posted by Captain Amazing View Post
When General Washington was commanding the Continental Army, he said to Congress, basically, "Don't pay me, just give me an expense account." Marvin Kitman's book analyzed Washington's expense account and wrote a book about it, coming to the conclusion that he bilked the hell out of Congress.
I haven't read the Kitman book, but I've read a lot about Washington by better-known historians, and none of them concluded that he bilked Congress. He kept very thorough accounts throughout his life, at Mount Vernon, as a general and as President. There was no lack of people who would like to have seen Washington embarrassed; there were some who even wanted his job (see: Gen. Horatio Gates and the Conway Cabal). The fact that none of them used the expense accounts as a political bludgeon, and that Congress covered Washington's expenses (despite some grumbling), makes me doubt Kitman's conclusions, to put it mildly.
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Old 08-26-2009, 03:20 PM
Elendil's Heir Elendil's Heir is offline
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... except for things like he's allowed to use the telephones at the White House to make fundraising calls....
Actually no. I remember reading during the 1996 campaign-fundraising controversy that President Clinton was taken to an office building owned by the DNC to call high-rollers. He wasn't allowed to make fundraising calls from the White House, IIRC.
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Old 08-26-2009, 03:36 PM
Ravenman Ravenman is offline
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Sorry, you're right. Bad example. Telephone calls for raising funds is prohibited. Things like telephone calls to plot electoral strategy are allowed for the President and employees of the Executive Office of the President. Other government employees would be prohibited from, say, writing a speech to give at a political rally on a government computer, but not so for the President and some White House employees.
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Old 08-26-2009, 04:51 PM
Captain Amazing Captain Amazing is offline
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Originally Posted by Elendil's Heir View Post
I haven't read the Kitman book, but I've read a lot about Washington by better-known historians, and none of them concluded that he bilked Congress.
Bilked is probably too strong a word. But he did use the expense account extensively, and billed a lot of things that would be considerable questionable by modern standards.

And Kitman's not a historian...he's a tv critic.
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Old 08-26-2009, 08:04 PM
kopek kopek is offline
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Bilked is probably too strong a word. But he did use the expense account extensively, and billed a lot of things that would be considerable questionable by modern standards.

And Kitman's not a historian...he's a tv critic.

Not being a historian may be to his advantage; he didn't have to battle 200 years of "spin" by those who hold Washington in high regard. He just saw something that struck him as odd and followed it. And I'm not that sure bilked is too strong a word. I am working partly from memory here, having passed on my copy of the book ages ago, but with a quick web search I found this example:

"To cash paid for Sadlery, a Letter Case, Maps, Glasses, &c &c &c. for the use of my Command... $831.45"

Skipping how often Washington used "&c" as well as his other favorite entry ("ditto"), what he paid for various things was the 1770s version of a $200 hammer. About $81 of that entry was for the letter case, made of Russian leather. If you were to visit Fort Niagara over the 4th of July weekend, you could find a sutler to make you one like it (but of ordinary American cowhide) for about the same price.

The total was $449,261.51, in 1780 dollars. I don't want to think what that would be in today's terms.

Elendil's Heir ---------- one review of the book I found quick on the web gives the following "One entry for $20,800 read, "the accounts were not only irregularly kept, but many of them were lost or mislaid, & some of them so defaced as not to be legible, that it is impossible for me to make out a statement of them." Put simply, George lost the receipts. Or maybe he never had them. Did Congress blink? Of course not. Instead, they lauded for his exacting arithmetic, and gratefully signed over the requested amounts."

I contend that the review is at least wrong in part; from what I have read in the standard references of Washington, my belief is that Congress did blink. And if you read many of the contemporary sources, you get hints here and there that his use of public funds was sometimes questioned. To a degree, the expenses may have been too obvious a weapon with too many "co-conspirators". After all, Congress DID pay the amounts with some grumbling here and there so they could have been held equally guilty. And Washington was a power then as he is now. Remember, there were serious propositions that he make himself King. As it is hard today, sometimes, to questions the actions or intentions of a President, or to follow the money, imagine the 1780s when dueling was not unheard of and mobs could rule.

Some time in the spring, once I am a little more used to this board, let us consider having a "Washington thread". It could be an interesting exchange of information.
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Old 08-26-2009, 10:54 PM
Tom Tildrum Tom Tildrum is offline
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Originally Posted by Markxxx View Post
First ladies for instance will garner speaking fees (around $200,000 for a current First Lady) and those are paid in cash upfront. Usually these are legit but many times the first lady gets paid this for merely showing up and introducing the president.
This would be an impossible conflict of interest for a sitting first lady. Perhaps you're thinking of former first ladies?
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Old 08-27-2009, 11:37 AM
Elendil's Heir Elendil's Heir is offline
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...Some time in the spring, once I am a little more used to this board, let us consider having a "Washington thread". It could be an interesting exchange of information.
Sure. Here are two threads that might be of interest:

http://boards.straightdope.com/sdmb/...d.php?t=524416
http://boards.straightdope.com/sdmb/...d.php?t=527134
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  #27  
Old 08-27-2009, 11:47 AM
Really Not All That Bright Really Not All That Bright is offline
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Originally Posted by Chronos View Post
To clarify the distinction between an "official" and "political" trip, what would a Town Hall meeting someplace far from Washington (like, say, the one here in Bozeman last week) be considered?
The determination is actually not as complicated as you'd think.

Basically, if he's stumping for a candidate (or attending another purely party-related event, such as the Democratic Convention), it's political.

If he's stumping for a policy (such as the townhall meetings) it isn't.

If he goes to Iraq to shake hands with veterans, it's official. If he goes to Iraq to shake hands with veterans and tells them to vote (absentee) for him, it's political.

Aside from the travel cost, this also determines whether or not White House staff can accompany him at the government's expense.
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Old 08-27-2009, 12:04 PM
Elendil's Heir Elendil's Heir is offline
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Harry Truman was very careful, during the 1948 campaign, to mix in politics with official duties. He toured the Pacific Northwest, for instance, ceremonially opening Federal facilities and meeting with local officials, but also gave reelection speeches in other places. Since he was out there primarily on official business, there were few complaints that his trips were too politicized. His successors have taken a similar approach. Until the last days of a reelection campaign, most Presidents are careful not to travel outside of Washington solely for political reasons. Official travel is covered by Uncle Sam; it saves money for the reelection campaign and for the president's national party.
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Old 08-27-2009, 05:11 PM
Chefguy Chefguy is offline
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Originally Posted by doubled View Post
Everybody knows the president makes $400,000 a year. But according to wikipedia:

"The President earns $400,000 per year, along with a $50,000 monthly expense account, a $100,000 non-taxable travel account and $19,000 for entertainment"
This is not only incorrect factually, but the use of the word "earns" is misleading. While POTUS earns his salary, the rest are budgeted amounts in accounts from which he can draw down expenses. Money left over at the end of the year does not become his, nor is it his in the first place, so of course it isn't taxed.
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