Taxes and Spending
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September 21, 2010
Washington Post on tax debate
The Washington Post reports this morning that letting current tax policy lapse (thus raising taxes on all Americans on January 1 next year), would generate enough revenue to “bring the country within striking distance of meeting President Obama’s goal of balancing the budget.”
A few counterpoints: -
September 20, 2010
The drumbeat gets louder
•Over the weekend, Obama economic advisor, Mark Zandi of Moody’s economy.com, published new research wherein he estimates that letting the tax cuts on small business and high-income earners expire would reduce GDP by 0.4 percent in 2011 and would reduce payroll employment by 770,000 by mid-2012. -
September 14, 2010
Update on 1099 Amendments
Politico has two articles this morning on the 1099 amendment votes expected today: One outlining the state of play of the Johanns and Nelson amendments, and a second on an Administration letter sent to the Hill yesterday supporting Nelson and opposing Johanns. The letter from Secretaries Sebelius and Geithner opposes the Johanns amendment’s reduction in funding for the Prevention and Public Health Fund, which some have characterized as a source of wasteful federal spending on pork projects like jungle gyms. Perhaps most notably, a Wall Street Journal article quotes a Treasury official as stating the Administration wants to “keep the [1099] proposal…as a means to ensure tax compliance,” while slightly mitigating its impact on small businesses. (The news that the Administration does not want to repeal the 1099 reporting requirement outright may come as a surprise to the 239 House Democrats who voted for a complete repeal of the new requirement back in July.) Meanwhile, small businesses themselves continue to highlight the problems that this onerous new reporting requirement will cause, while advocating for the complete repeal of the 1099 provision: The NFIB sent a key vote letter supporting Johanns and opposing the Nelson side-by-side, while US Chamber of Commerce Executive VP Bruce Josten has a Roll Call op-ed on the issue.
RPC Analyst Chris Jacobs
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September 1, 2010
WSJ: Tax Cuts Weighed to Spur Economy
It’s interesting that the White House is spinning its wheels trying to devise new ways to stimulate the domestic economy when private industry has been very clear about what it needs: (1) clarity on the direction of EXISTING tax policy, and (2) agency guidelines that specify how the new health care and financial regulations will be implemented.
Instead of creating a wholly new to-do list, perhaps this White House should focus on the one it already has.
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August 5, 2010
Taxpayers Cannot Afford More State Bailouts
After their failure to bring a budget to the floor, Senate Democrats are attempting to shove not one but two bailouts for states before leaving for the August recess. Although many state and local governments have been hurt by the economic downturn, they - like the federal government - are facing difficult decisions because of unsustainable spending. This irresponsible spending will only get worse if the federal government continues to bail out states. -
August 4, 2010
Impact on families of the Democrats' pending tax increase
On Monday, The Tax Foundation released a report examining the impact of the Democrats’ pending tax increase on the average middle-income family in all 50 states and the District of Columbia, as well as each Congressional district. The report analyzed the federal tax burden on median family income both pre- and post-Dec 31st (the date current tax policy expires) and found that a typical middle-income household with a U.S. median income of $63,366 would pay $1,540 more in federal income taxes if current tax policy is allowed to lapse.
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July 30, 2010
Fed Reserve President Agrees: Raising Taxes During Recession is a Bad Idea
St. Louis Federal Reserve President James Bullard was on CNBC’s Squawk Box this morning and when asked about preventing the Democrat’s tax increase, Bullard replied “Increasing taxes when the economy is trying to recover is not a good plan.”
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July 30, 2010
Democrats in Retreat Over 1099 Tax Reporting Requirements
The Wall Street Journal this morning reports on the troubles that the 1099 business tax reporting requirements included in Section 9006 of the health care law are causing for Democrats in Congress. Under the provision, vendors and small businesses are required to file Forms 1099 for any goods purchases that total over $600 in the aggregate over the course of a year – which will force all businesses, including small businesses, to file tax forms listing the amount of their annual transactions with vendors like their paper supplier, bottled water distributor, caterer, etc. The National Taxpayer Advocate has noted this provision will affect 40 million businesses – ten times the number of firms the Administration asserts will benefit from small business tax credits – and has called the paperwork requirements “disproportionate” and “burdensome”. -
July 14, 2010
Dodd-Frank Financial Regulation Conference Report is Deeply Flawed
Using the Senate-passed financial services regulation bill as a starting point, the conference committee’s final agreement – one opposed by every House and Senate Republican conferee – adds troubling new requirements to the legislation and fails to correct harmful provisions in the Senate-passed text. In the end, the bill fails to deliver the reforms needed to prevent the next financial crisis, adds unnecessary burdens on American financial institutions, and increases costs for American consumers. -
July 14, 2010
Will Senate Democrats Follow the House’s Lead And Sell Out Education Reform To Appease Unions?
On July 1, 2010, the House passed H.R. 4899, the Defense Supplemental Appropriations Act of 2010. This important legislation is intended to provide much-needed funding for our military at a time when it is defending our nation in two wars. Unfortunately, Democrats decided to include controversial funding for their other spending priorities that are wholly unrelated to defense spending. One of the more controversial provisions is the inclusion of $10 billion for an “Education Jobs Fund” that would use federal dollars to supplement state budgets to pay salaries of teachers, administrators, janitors, and other school personnel. -
July 14, 2010
WSJ: Dems pick unions over kids
Today the Wall Street Journal chronicles the ongoing rift between the Obama Administration and Congressional Democrats over funding for education jobs. The editorial points out that Democrats have consistently chosen the best interests of unions, who advocate for more money and less accountability, over those of students. It also highlights that school districts have been adding to their payrolls for decades without regard to student enrollment so in reality districts could economize and trim the bureaucracy without having to lay off as many teachers as they claim. -
July 7, 2010
Rationing With Open Eyes:
The Consequences of Donald Berwick’s Agenda
Donald Berwick, President Obama’s nominee to head the Centers for Medicare and Medicaid Services (CMS), has a history of support for government rationing of health care resources on cost grounds. He has spoken favorably about Britain’s National Institute for Health and Clinical Excellence (NICE), which denies patients access to life-saving treatments the National Health Service (NHS) deems too expensive. The American people should have their eyes open to the ramifications of NICE-style rationing in the United States as part of Democrats’ brave new health care world. -
July 6, 2010
Where is the growth?
Gerald Seib asks the right question in his Capital Comment column in the Wall Street Journal this morning: “What about economic growth?” As lawmakers and policy wonks debate the merits of fiscal stimulus versus deficit reduction, we’re losing sight of the key objective: economic growth. Growth will help “stimulate the economy and reduce the deficit at the same time,” says Seib. Unfortunately, Seib doesn’t take his argument much further. -
July 6, 2010
CEOs think Obama is anti-business
Fareed Zakaria had an article in Monday’s Washington Post discussing President Obama’s “CEO problem.” With $1.8 trillion in cash on domestic corporate balance sheets, why aren’t businesses spending? First and foremost, companies are worried about economic uncertainty, but there is also a fear of new taxes and regulation—a government that has reached too far. At their core, many large company CEOs feel the President is anti-business. -
July 6, 2010
Why Orszag quit
WH failure to push for greater cost controls lead Obama Budget Czar to the exit -
July 1, 2010
Washington Post: Bill to save teachers' jobs would slash reform programs
This morning the Washington Post published a highly critical editorial on the House Democrats’ efforts to include the $10 billion education jobs slush fund in the Defense Supplemental. It points out that school districts are managing to find other ways to cut costs and keep teachers in the classroom. It also points out the Democrats proposal does nothing to address the fact that teachers will not be retained based on effectiveness. The editorial goes on to say, “If his measure is approved, fewer states will get funds to reward high-performing teachers who work with at-risk students, there will be less money to help effective charter networks like KIPP (Knowledge Is Power Program) and there will be no incentive for states to enact reforms.”
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June 30, 2010
House Dems: "The tax code should be one giant annual extender"
We’ve all heard stories about how uncertainty over the direction of US tax policy is killing business investment and job creation. Now, House Democrats just whacked the consumer, the biggest driver of US economic growth. -
June 30, 2010
House releases amendment porking-up war supplemental
The House has posted on the Rules Committee web site its amendment to the war supplemental. Its amendment starts by reading “Page 90, after line 18, insert the following.” This means that the House has completely taken the war supplemental as passed by the Senate, and then added a host of domestic spending and programs . -
June 29, 2010
How the Obama Administration’s New Regulations Give Insurance Companies More Control Over Small Businesses
President Obama and Democrats in Congress claim that their government takeover of health care will curb insurance company abuses. But in reality a series of new rules will give small businesses struggling to afford coverage for their workers even less ability to control skyrocketing premiums. Instead of being able to negotiate with insurance companies for more affordable coverage, small businesses face a “choice” of either accepting their current carrier’s premium increases or purchasing new, costlier coverage mandated by the health care law. -
June 16, 2010
More on Dishonest CBPP attack on Thune amendment
The extremely liberal Center for Budget and Policy Priorities (CBPP) is out with a disingenuous attack against the Thune Amendment #4333 to the Democrats’ extenders bill.
According to CBPP, the Thune amendment would result in a 22 percent cut to total FY2010 appropriated funding and, in their words, “shut down much of the federal government for final months of fiscal year.” They arrive at this conclusion through sleight of hand and fuzzy math, which needs to be corrected.