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| Reading the Fine Print |
May 21, 2004 |
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Dear Friends,
Sometimes, you have to read the fine print.
We voted on a bill in the House today that was advertised as making the Child Tax Credit permanent, and it did. But it also added more tax relief that we haven’t passed before, and I’m not sure the time is right for that.
I supported the expansion of the child tax credit to $1,000 per child that was included in the Jobs and Growth Tax Relief Reconciliation Act signed into law by the President on May 8, 2003. I also support making the tax relief contained in that bill permanent. When we change the tax code, we should make changes for the long haul, not changes that phase out after a couple of years. That tax relief came just at the right time to keep the 2000-2001 recession short and shallow.
Since that time, we have been engaged in a war on terrorism that we did not choose and that we must win.
I have concerns about further tax relief beyond making permanent what we have already passed at a time when our budget still does not balance and we expect to have a lot of bills to pay. The stimulative effect of expanded tax relief does not appear to be needed at this point: we have had four quarters of the strongest economic growth in twenty years and have created 1.1 million jobs since last August, including monthly growth in manufacturing jobs over the last three months.
Neither the Democrat substitute nor the underlying bill simply made permanent the child tax credit we have already passed. If they had, I would have supported them. The base bill we voted on expanded the tax credit to new higher income taxpayers that cannot now claim the tax credit. That would result in projected $70 billion in reduced revenue over the next 10 years. The Democrat substitute expanded the refundable child tax credit to people at lower incomes who cannot currently claim it.
It’s not the government’s money. It’s the people’s money and I look forward to a time when I can support the next round of tax relief. But we have work to do before then. We must win the war on terror, continue policies that have gotten us back to strong economic growth, and control the growth of government spending so that balancing the budget and paying off publicly held debt is back in reach.
Particularly when it comes to the economy and the budget, you have to make judgments on what is right to do at a particular point in time. There were only a handful of Republicans who agreed with me on this one. But maybe some folks didn’t read the fine print.
Wish you were here,
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