New York City has forfeited hundreds of millions of state and federal dollars because union and city officials haven't agreed on a new evaluation system that would judge teachers, in part, on student test scores.

WSJ: Seattle Teachers Protest Exams

And Senator Bayh said the President may propose a freeze in most federal discretionary spending in the State of the Union.

WHITEHOUSE: Press Briefing

He was promoting an issue that he called for in this week's State of the Union address: federal spending and tax breaks to improve the nation's competitiveness.

NPR: Bush Promotes Competitiveness Initiative