Friday, April 06, 2007

New Majority = New Taxes? Gee thanks.

Well America, way to go! Thanks for voicing your discontent by electing a majority that is notorious for raising taxes rather than trimming spending. (You are sensing the sarcasm here, aren't you?)

At least those of us in the 4th District know that Representative Geoff Davis has our back on tax increases! This article is from his newsletter this week. (I wish they would publish this particular newsletter in full form to the Congressman's website -- it's always worth a read.)

Congress Continues Work on the Budget

Last week before adjourning for the spring recess, House Democrats ushered their fiscally-irresponsible budget proposal for FY2008 through the House. I was proud to vote against this budget that includes an average tax increase of $2,563 for an estimated 1,405,000 Kentuckians.

I supported the alternative budget offered by the Republicans. The Republican substitute achieves a balanced budget by 2012 and would maintain the tax relief enacted in 2001 and 2003. Without maintaining these important provisions, more than 1,245,000 Kentuckians would see their taxes increase as the 10% tax rate bracket disappears, more than 476,000 Kentuckians would see their taxes increase an average of $466 as a result of reinstatement of the marriage penalty, and more than 381,000 families would see their tax bills increase as the child tax credit reverts to $500 from $1,000. These tax increases on our hard working Kentucky families are not necessary.

Perhaps most importantly, the Republican alternative budget, unlike the Democrat proposal, provided meaningful reform in entitlement spending. Current entitlement spending is growing at an unsustainable pace, and we must act now or face the loss of future benefits. The budget proposed by Republicans builds on the successes of the Deficit Reduction Act of 2005 as it achieves an additional $279 billion in savings over five years. These savings are achieved without a reduction in benefits. By implementing reforms, overall entitlement growth is moderated from 5.2% to 4.3% annually. In stark contrast, the Democrats' budget contains no reforms despite continued warnings from financial and economic analysts that immediate action is required to maintain the solvency of entitlement programs.

The Republican alternative budget also contained measures to increase government accountability and transparency in spending, such as line item veto power for the President. The legislative line item veto would give the President the authority to veto specific measures in spending bills and send them back to Congress for an up or down vote on the project. The Republican proposal also established caps on discretionary spending in annual appropriations bills. I believe these measures would go a long way towards reducing wasteful spending and forcing Congress to be more accountable.

In addition, the Republican alternative strengthened the Democrat-supported PAYGO, or pay-as-you-go, budget rules. The provision in the Republican budget requires direct spending increases to be offset with spending reductions, not new taxes. This type of reform would ensure that taxes could not be raised to pay for reckless spending.

Though the Republican alternative budget proposal was ultimately defeated, I believe it contained many provisions that are important for our ongoing dialogue about fiscal restraint in Congress. As the House and Senate work to find compromise on the budget, I will continue to fight for permanent tax relief, meaningful entitlement reform, and against needless tax increases for Kentucky families.

1 comment:

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