Happy Cost of Government Day, America! Workers Toil 186 Days to Pay For The Full Costs of Government
In 2014, Cost of Government Day falls on July 6.This day marks the point during the year when the average American has earned enough income to pay for his or her share of the spending and regulatory burdens imposed by government at the federal, state and local levels. While Americans may be celebrating Independence Day on July 4, they are still working to pay for the full cost of government until the end of the weekend. This will be the sixth consecutive year that COGD will fall in July; prior to President Obama taking office, COGD had never fallen after June 27.
All told, the full costs of government amount to 51 percent of GDP. Workers toil 121 days to pay for government spending alone, and 65 days to pay for regulatory costs. All told, Americans labor 186 days to pay off the full burden of government.
States like Connecticut and New Jersey must work past national COGD in order to pay for the costs of high spending and taxes in their states. The latest state COGD once again occurs in Connecticut, falling on July 26 for 2014. The earliest COGD goes to Louisiana, occurring on June 12 this year.
Reflecting the success of efforts by Republicans in Washington to cut the size of government by capping discretionary spending, the days worked to pay for federal spending decreased since last year. However, federal regulatory costs have increased since 2013. Increased unilateral executive action will only push these costs higher. While Americans worked 65 days to pay for the costs imposed by regulation in 2014, if the regulatory regime grows larger it will almost certainly auger much later Cost of Government Days in the future.
ATR Opposes Tax Increases to Fund Transportation Spending
Americans for Tax Reform is troubled by recent suggestions that the next highway bill will include new taxes to pay for transportation spending. The shortfall facing the Highway Trust Fund is not a matter of too little revenue; it is a consequence of too much spending. Lawmakers who pursue tax hikes to inflate the trust fund will signal they are unwilling to tackle the real challenges of fixing transportation spending.
Federal funding practices prevent smart spending on crucial infrastructure. Gas tax receipts are not used to build roads but pilfered for more politically popular transit and recreation projects. Limited resources are wasted fulfilling outdated labor laws that drive up the cost of federal construction projects. The strings tied to highway dollars sent to the states induce local lawmakers to spend inefficiently and unwisely on unmerited projects.
ATR encourages lawmakers to confront these challenges and remains opposed to efforts to raise taxes to pay for more highway spending
ATR Opposes Senate's Latest Attempt at the Buffett Tax in Student Lending Bill
The United States Senate will consider S. 2432 this week, the Bank on Students Emergency Loan Refinancing Act. The bill is a massive tax hike, meant to fuel more government spending and greater federal intrusion into higher education lending practices.
S. 2432 amounts to a permanent $73 billion tax hike over the next decade on American job creators. The bill phases in a minimum effective tax rate of 30 percent on earners making over $1 million. According to the Treasury Department, the vast majority of these earners are business owners.
The tax code is already steeply progressive. Continuing to attack business owners who pay their taxes through the individual side of the code further discourages capital investment and hiring.
The Senate has already rejected this so-called “Buffett Tax” on eight separate occasions; it remains a poison pill for the American economy and a measure that will continue to impede the recovery.
Lawmakers seriously concerned with the challenges facing the American middle-class should reject anti-growth measures that restrict opportunity for employers and workers. Americans for Tax Reform strongly urges all Senators to oppose S. 2432, the Bank on Students Emergency Loan Refinancing Act.
To Support Women, Repeal Obamacare
Democrats are observing Equal Pay Day today by promoting new regulations that make labor more expensive and less flexible, restricting employment opportunities for women. Proponents of the Paycheck Fairness Act ignore the fact that actions taken by Washington exacerbate economic inequality - in fact, Obamacare includes 20 new or higher taxes, a handful of which hit women particularly hard.
1. Obamacare Individual Mandate Non-Compliance Tax: Starting this year, anyone not buying “qualifying” health insurance – as defined by President Obama’s Department of Health and Human Services – must pay an income surtax to the IRS. Millions of women have already lost their health plans because they were not "qualified" under Obamacare. While the Obama Administration has exempted its Big Business friends from this tax, the individual mandate tax grows for individuals and families each year it is in effect, amounting to at least 2.5 percent of adjusted gross income by 2016.
2. Obamacare Flexible Spending Account Tax: The 30 - 35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs face a new Obamacare cap of $2,500. Before Obamacare, the accounts were unlimited under federal law. This is a very visible tax hike for women, who are most likely to be the primary health care decision makers in their families. This is especially true for mothers of special needs children. Nationwide there are several million families who use FSAs to pay for special needs education, which can cost tens of thousands of dollars. This Obamacare tax provision will limit the options available to these families.
3. Obamacare High Medical Bills Tax: Before Obamacare, Americans facing high medical expenses were allowed a deduction to the extent that those expenses exceeded 7.5 percent of adjusted gross income (AGI). Obamacare now imposes a threshold of 10 percent of AGI. Therefore, Obamacare not only makes it more difficult to claim this deduction, it widens the net of taxable income.
4. Medicine Cabinet Tax. Since January of 2011, Americans have not been able to purchase over-the-counter medicines from their Flexible Spending Accounts or Health Savings Accounts. Women often rely on over-the-counter medicines to get themselves and their families through the colds, fevers, and aches and pains of daily family life. To raise taxes on busy Moms makes absolutely no sense.
5. Obamacare 10 Percent Excise Tax on Indoor Tanning: This Obamacare tax increase has the distinction of being the first to go into effect (July 2010). This petty, burdensome, nanny-state tax affects both the business owner and the consumer Industry estimates from the Indoor Tanning Association show that 30 million Americans visit an indoor tanning facility in a given year, and over 50 percent of salon owners are women. There is no exception granted for those making less than $250,000 meaning it is yet another tax that violates Obama’s “firm pledge” not to raise “any form” of tax on Americans making less than this amount.
House GOP Budget Challenges President Obama's Vision for America
Today, Chairman Paul Ryan released his final budget blueprint as head of the House Budget Committee (leadership is limited to six year terms). The budget stands in sharp contrast to the vision reflected in President Obama’s 2015 budget proposal, released last month.
The House GOP budget balances in ten years. The President’s budget never balances.
The House GOP Budget does not raise taxes. Instead, it lays out principles for tax reform – such as lowering the corporate rate to 25 percent – and instructs the Ways and Means Committee to pursue comprehensive reform. The President’s budget increases taxes by over $1 trillion (and did we mention it STILL doesn’t achieve balance?).
The budget will bring spending far below its historical average of 21 percent, actually creating an operating surplus by the end of the ten year window. The President plans to maintain structural deficits in perpetuity.
The President would keep entitlement programs barreling towards bankruptcy, while the House budget plan will allow seniors more choices for Medicare coverage, and reverse the program’s death spiral.
By restructuring federal Medicaid and welfare spending as block grants, the House blueprint empowers state and local governments to tailor Medicaid and other assistance programs to their own populations’ needs. The President would increase spending on these programs without any reforms that ensure their efficiency or solvency.
The Chairman’s mark repeals the Affordable Care Act, and with it the uncertainty created by its haphazard enforcement by the administration. The President would double-down on the job-killing law and maintain its 20 new or higher taxes on American families and businesses.
What's Old Is New Again: Obama Budget Plan Recycles Bad Policy
What’s in the President’s 2015 budget proposal? Old ideas with a new spin.
Old and Busted: The Bipartisan Budget Agreement of 2013, which President Obama signed into law mere months ago
Shiny and New: The Presdent's proposal blows the Bipartisan Budget Agreement's spending caps in the very first year and neglects to maintain them in years they are in place under current law. The plan would increase spending by $56 billion in 2015 alone, and ultimately add $791 billion in new spending over the next ten years
Old and Busted: A failed trillion dollar “Stimulus” plan
Shiny and New: A $156 billion “Opportunity, Growth and Security Initiative” that will enrich labor unions and the politically well-connected under the guise of investing in infrastructure and improving education
Old and Busted: Any effort to discuss entitlement reform
Shiny and New: Zero long-term structural reform that is needed to save entitlement programs. Instead, the President’s plan would increase mandatory spending by nearly $1 trillion over the decade.
Old and Busted: Honest budgeting
Shiny and New: Tortured budget wonks and baselines alike. The President’s plan double counts savings in the health care law and in emergency spending accounts to enhance its deficit reduction numbers. In addition, its extra spending and tax proposals are essentially appended to the plan; so the baseline spending and tax estimates are actually much worse than they appear in the baseline tables.
Old and Busted: The health care law is the "Law of the Land"
Shiny and New: The budget fully funds the Affordable Care Act, meaning its bailouts for big insurers, requirements forcing employers to shed employees or cut down their hours and the slew of twenty new or higher taxes stay in place. What isn’t clear is how many of the illegal Obamacare delays unilaterally authorized by the President will become law.
What’s Old is New Again: Over $1 trillion in new taxes. Some things never change.
ATR Urges House To Vote No on Repealing Military Pension Savings
Americans for Tax Reform urges all members to vote NO on S. 25, a bill on suspension that would repeal the military cost of living adjustments established in the Bipartisan Budget Act of 2013. The Budget Act was passed into law a mere two months ago, and rescinding the savings in the law signals lawmakers are unwilling to keep their word on difficult budget decisions.
The long-term liabilities in the defense budget cannot be ignored. In fact, military leaders have been warning for years that rising personnel costs pose one of the most urgent threats to America's military readiness.
The savings passed into law last year trim pension costs for working-age military retirees; benefits are still readjusted to previous levels at age 62. This is a small change to save resources that are becoming increasingly more strained - the Wall Street Journal reports that personnel costs will consume the entire defense budget by 2039 if sustainable reforms are not made.
Congress is currently presiding over the most consistent drop in discretionary spending that the country has witnessed in the modern era. To reverse this trend immediately following the first bipartisan budget agreement in years would signal Washington is returning to its foolhardy spending practices of old. We urge you to stand with taxpayers and vote no on S. 25.
Conservatives Oppose Reported Debt Limit Deal
On the behalf of the millions of taxpayers and concerned citizens represented by our organizations, the undersigned groups are united in opposition to the House’s reported debt limit deal.
The House is considering increasing the debt limit in exchange for higher government spending. Mandatory spending cuts scheduled under current law would be wiped out.
This new spending in the debt limit deal would be offset in the ten-year budget window by new spending caps. Over the longer run, however, permanent mandatory savings worth tens of billions in taxpayer dollars would be eviscerated.
While our groups have advocated different approaches for fighting the growth of government in the past, we are united in opposition to a plan that would squander the leverage of the debt limit in exchange for increased spending. We urge you to oppose this reported debt limit deal.
Omnibus Bill Indicates Progress Being Made By Conservatives in Budget Battles
The FY 2014 omnibus appropriations bill, which fills in the spending levels set out by the Bipartisan Budget Act of 2013, falls short of many conservative ideals. There are some aspects of the bill, however, that point to the strength of the small government movement and the battles it has won over the past few years.
- Overall spending is down. Spending, in real terms, is lower than spending in Fiscal Year 2009, the first year of the Obama Administration. With discretionary levels set at $1.012 trillion, FY 2014 will be the fourth year in a row spending has fallen from the previous year.
- Four years of consistent spending reductions. Since Republicans took control of the House in 2010, spending has decreased by $165 billion. This means the gains made by a commitment to cutting spending in continuing resolutions, the spending caps established in the Budget Control Act and the sequester savings locked in over ten years have erased what was supposed to be the lasting legacy of President Obama, Speaker Pelosi and Leader Harry Reid.
- Obamacare advocates are now on defense. After a disastrous rollout of his health care law, the President and his allies are calling a bill that provides no additional spending for agencies to implement Obamacare a “positive step forward.” Democrats are on their heels trying to defend the Affordable Care Act; even they won’t pretend that more funding can fix the flawed law.
- Keep the IRS in line. The bill would decrease funding for the embattled Internal Revenue Service. It restricts the agency’s spending by prohibiting funds from being used to target groups for scrutiny based on their ideology or for producing videos. It also requires increased reporting on training and compensation.
- Rein in the EPA. The bill continues to shrink the size of the EPA by reducing funding and blocking the Administration’s attempts to increase the costs of domestic energy production. The bill will reduce the number of EPA regulators to a 25-year low, and delay some provisions in the Administration’s war on coal until the next fiscal year.
- Put legislating back in the hands of legislators. While using a large omnibus bill to fill out the budget outline can hardly be considered regular order, it does remove the executive branch’s discretion in implementing the sequester. It places appropriating back in the proper branch of government, where funding should be debated and amended on its merits.
The omnibus leaves many things to be desired. But it does demonstrate slow progress in a time where many, at one point, believed the fight for smaller government was all but lost.
Americans for Tax Reform Opposes Senate Democrat Clean Debt Limit Hike
The Senate is poised to take up a “clean” debt limit bill that would increase the nation’s borrowing authority by at least $1.1 trillion dollars with no spending or budget reform attached.
The debt ceiling is a tool to monitor the country’s fiscal health. Lawmakers cannot claim to be serious about the country’s debt if they vote to increase the debt limit without any plan to address government spending. By suspending the debt ceiling for over a year, S. 1569 would eliminate any chance for budget reform that tackles the nation’s debt.
In 2011, taxpayers won $2.5 trillion in cuts after both parties agreed spending reform was a necessary condition of increasing the debt limit. The Senate Democrat plan would reverse these gains and give the President a blank check to increase spending until past the next election. If Washington is ever going to get its fiscal house in order, it must do so now by having a serious debate over federal budget issues.
Taxpayers deserve better. Vote no on the long-term clean debt limit hike.