Mattie Duppler

House GOP Debt Limit Deal Represents Opportunity for Taxpayers


Posted by Mattie Duppler on Wednesday, July 27th, 2011, 10:20 PM PERMALINK


Americans for Tax Reform continues to support the Budget Control Act of 2011 after CBO released an updated estimate of the bill's budgetary impact. The only serious proposal that addresses the country's debt crisis, the Budget Control Act institutes real cuts, establishes enforceable spending caps on discretionary spending and requires a vote on a Balanced Budget Amendment to the Constitution in Congress.

Most importantly, it fulfills the pledges made by House Republicans throughout the entire debt limit debate: No "clean" debt limit hike that ignores the government's spending problem, cuts greater than borrowing authority extended and no tax increases. Specifically, the House debt limit proposal:

  • Extends $900 billion in borrowing authority (roughly enough for the next six months) in exchange for savings of $917 billion over the next ten years. This is a cut of about 8 percent of total expected discretionary spending for half of a year of borrowing authority.
  • Removes outlay caps from the first version of the bill, reducing the amount of money actually going out the door in next year's budget. This limits budgeted spending to two percent annual growth while tightening the amount of actual spending allowed to occur in 2012. This results in savings of $25 billion next year alone.
  • Proves that the House-negotiated FY2011 Continuing Resolution was a good deal for taxpayers - CBO's updated projections to include the deal show it will save taxpayers $122 billion over the next decade. Under the Obama budget, spending would have increased by over $400 billion in the same time.
  • Requires additional real savings of at least $1.8 trillion before the President can request additional borrowing authority.

"Republicans have proven once again that they take the pledges they make to taxpayers seriously," said Americans for Tax Reform President Grover Norquist.  "House Republicans didn't blink when their initial bill came in under projections;  they did what they promised to do and rewrote the bill to cut more. This signals more reform is down the road, but lawmakers need to take the first step in getting there. The House's plan to solve the debt limit debate is that necessary first step."

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Will the House Republican Plan Lead to a Tax Increase?


Posted by Mattie Duppler on Tuesday, July 26th, 2011, 3:55 PM PERMALINK


The release yesterday of the House Republican plan to solve the debt limit debate in a two-step process has raised questions as to whether the second step in the proposal will lead to a tax increase. After an initial debt extension of lesser value than cuts enacted, the proposal enacts a Select Committee that is responsible for finding $1.8 trillion in savings before more borrowing authority can be exercised in the spring.

The Select Committee will be comprised of twelve members, with leadership from both parties and both chambers selecting who will serve on the committee. The Committee is required to submit a proposal to enact real savings that must be approved by both chambers of Congress and signed into law by the President. Only then will the debt ceiling be raised, again at an amount less than the enacted amount of spending cuts.

That the bill does not explicitly prohibit tax increases as part of the Committee’s final plan has caused some concern. It shouldn’t. By holding firm throughout the debt limit debate on their pledge not to raise taxes, Republicans have removed taxes completely from any debt limit negotiations. There is no reason to believe that the intervening months will weaken this resolve.

Since a tax hike is dead on arrival in the House, any Committee wishing to be a serious contributor to the debt limit debate will not recommend a plan with tax hikes, which they know cannot pass the chamber.

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House Republicans Solve Debt Limit Impasse by Cutting Spending


Posted by Mattie Duppler on Monday, July 25th, 2011, 4:59 PM PERMALINK


Americans for Tax Reform applauds House Republicans for providing another tangible plan to cut spending and avoid default. Consistent with Leadership’s promise, this plan would implement the House-passed Cut, Cap and Balance Act in a way that would be successful in both chambers. This plan would cut trillions of dollars from the federal budget without raising taxes.

The only reason that tax increases are off the table at this critical juncture in the debt limit debate is because Congressional Republicans have held firm on their pledge to their constituents not to raise taxes. This leaves spending cuts as the only viable debt limit solution. Unlike the fraudulent deals of 1982 and 1990, taxpayers will not be put on the hook by politicians in Washington, D.C.

  • Speaker Boehner and the House Republicans have established a new and permanent metric for extending borrowing authority: Namely, that real spending cuts exceed the amount by which the debt ceiling is raised. This turns conventional wisdom on its head, demanding lawmakers make a down payment on spending restraint.
  • The plan establishes statutory spending caps that will reduce anticipated discretionary spending by over $1 trillion dollars. This begins to rollback the bloated spending baselines generated by the Bush and Obama Administrations. The caps are enforced by annual sequestrations, ensuring Congress cannot spend above the limits.
  • This debt limit increase buys time until the spring, at which time a Select Committee will recommend further rescissions in exchange for another debt limit increase. The President will only be allowed further borrowing authority if the Select Committee recommendations pass both the House and Senate and he signs the bill into law.  Even then, the amount by which the debt limit is increased must be less than the amount of cuts adopted. Americans for Tax Reform expects the Committee report to keep tax increases off the table—a continuation of the commitment made by Congressional Republicans in this debate.
  • The proposal will require each chamber of Congress to vote on a Balanced Budget Amendment to the Constitution by the end of the year. Americans for Tax Reform will oppose any Balanced Budget Amendment that does not include at least a two-thirds super-majority requirement to raise taxes.

Americans for Tax Reform President Grover Norquist said: “Here’s the big picture: No tax increase. Real spending cuts. Cuts first and debt ceiling second. This plan is good for taxpayers, children and other living things.”

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Balanced Budget Amendment Must Include Protections for Taxpayers


Posted by Mattie Duppler on Friday, July 22nd, 2011, 3:09 PM PERMALINK


The debt limit debate has only produced one serious proposal to rectify the government's spending problem: the Cut, Cap and Balance Act of 2011. This bill, which passed the House and received unanimous Republican support in the Senate was rejected by Senate Democrats who would prefer to bankrupt the country than reform spending.

The Cut, Cap and Balance Act would implement spending cuts next year, establish statutory spending caps and require the passage of a Balanced Budget Amendment (BBA) to the Constitution before any new borrowing authority can be exercised.

The Cut, Cap and Balance Act is important in that it articulates the BBA MUST INCLUDE a requirement that any tax hike achieve a super-majority to pass in either chamber. This ensures spending cuts, rather than tax hikes, are used to balance the budget. ATR sent an alert today to Members of Congress, warning lawmakers we would rate a vote against any BBA that does not include this necessary protection for taxpayers. From our alert:

Washington has an overspending problem, not an under-taxing problem. Historically, outlays have averaged about 21 percent of Gross Domestic Product (GDP) while revenues have amounted to about 18 percent of GDP. Due to the Obama Administration and Congressional Democrats’ spending binge, outlays now average almost 25 percent of GDP, and are projected to stay around 23 percent in perpetuity.

Unless tax hikes are taken off the table, reckless lawmakers will increase taxes to pay for these new bloated spending levels, rather than bring spending in line with revenues. Any lawmaker serious about restoring American solvency cannot seriously vote for a BBA that does not include a super-majority requirement for tax increases. To pass a BBA that allows a tax hike by simple majority is to distract from the real problem of government spending, and leave taxpayers to bear the burden of foolhardy federal budgeting.

Click here to read the complete alert.

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Senate Republicans Support Debt Limit Solution


Posted by Mattie Duppler on Friday, July 22nd, 2011, 11:41 AM PERMALINK


Senate Democrats refused to solve the debt limit debate on Friday, rejecting the Cut, Cap and Balance Act of 2011 which would cut spending, restrain future outlays and require passage of a Balanced Budget Amendment to the Constitution. The Senate then adjourned for the weekend, without offering any way forward in the debt limit debate.

While taxpayers have been balancing their household budgets by restraining their own spending, every Senate Democrat present voted against requiring the federal government to do the same. Voters understand Senate Democrats rejected a solution for America’s debt problem without offering any plan of their own.

Senate Republicans unanimously supported the Cut, Cap and Balance Act, showing they are unwilling to allow continued distraction from the government’s overspending problem. Congressional Republicans have repeatedly refused to accept any debt limit deal that increases taxes, keeping the focus where it should be: the government’s overspending problem. Democrats’ rejection today of the only solution offered to fix that problem shows they would rather bankrupt the country than restrain federal spending.

“Senate Democrats, who haven’t proposed a budget in over two years, must think taxpayers aren’t paying attention,” said Americans for Tax Reform President Grover Norquist. “They’re wrong—after their rejection of the only concrete plan to end the debt limit dealings, voters are wondering what Senate Democrats are doing every day in Washington…because it certainly isn’t their jobs. This vote proves that Democrats are not interested in governing; taxpayers tend to remember things like that.”

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Cut, Cap and Balance: Will the Senate Refuse a Debt Limit Deal?


Posted by Mattie Duppler on Thursday, July 21st, 2011, 5:24 PM PERMALINK


Today, Americans for Tax Reform and its Center for Fiscal Accountability sent a letter to the United States Senate urging member to support the Cut, Cap and Balance Act. Majority Leader Harry Reid announced today he will move to table the bill tomorrow, effectively killing the only serious legislative proposal to solve the debt limit impasse. After refusing to even pass a budget for over 800 days, will Senate Democrats allow a debt limit deal to fail too? From our letter:

H.R. 2560 would also establish statutory spending caps that would set total federal spending on a glide path down to its historical average of 19.9 percent of Gross Domestic Product (GDP). After the failed “stimulus” plan and continued government intrusion into the free market in the form of bailouts and regulatory overreach, federal spending stands at close to 25 percent, and is expected to average 23 percent over the past few years. With revenues leveling out at their 18 percent average at the same time, it is obvious the government’s spending is the problem that needs to be addressed.

Lastly, the bill would require a Balanced Budget Amendment to the United States Constitution be passed by Congress before additional borrowing authority can be exercised by Treasury.  The legislation specifies the amendment would have to satisfy the critical requirement of a two-thirds majority of both chambers in order to raise taxes, ensuring taxpayers will not be on the hook for the foolhardy spending practices of reckless lawmakers.

The Cup, Cap and Balance Act of 2011 represents the most serious legislative proposal offered in the debt limit debate. We encourage you to support H.R. 2560 and reject the effort to table the bill. 

Click here to read the letter in its entirety.

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Senate May Tank FAA Bill To Keep Taxpayers On the Hook for Their Flights


Posted by Mattie Duppler on Thursday, July 21st, 2011, 12:08 PM PERMALINK


Yet another Federal Aviation Administration (FAA) extension passed the House of Representatives yesterday, the 21st time the agency has been reauthorized by a short-term measure after its authorization expired in 2007.  We have warned in the past that the FAA’s wasteful and inefficient programs make it an ideal place to look for potential taxpayer savings.  And today, Republican members of the House will endeavor to do just that, scrutinizing legislation that has gotten a free pass for four years by reforming the Essential Air Service (EAS).

The EAS provides subsidies that make air travel to remote, formerly unprofitable, locations available – in effect, underwriting flights home for Members of Congress who don’t reside close to a big city airport.  Since 2001, EAS expenditures have increased by 300 percent, amounting to over $200 million in FY 2010 for the program. Each flight can cost taxpayers up to $3,720 per passenger. The willingness to cap, and ultimately phase out, this wasteful subsidy shows that House Republicans are serious about reforming wasteful spending programs.

It is rumored the Senate will balk at approving the extension because of these changes, this would result in the first time a short-term authorization has failed to pass, resulting in a shutdown of the FAA. It is perhaps hardly surprising Senators would be willing to shut down a government agency to preserve taxpayer funding for their luxurious travel, but it is extremely offensive that such a defiance of duty would even be considered in light of the contentious debt limit debate. It is noteworthy that one of the airports that would be affected by the new rules is in Nevada, home to Senate Majority Leader Harry Reid. After refusing to lead the Senate to do its basic responsibility and produce a budget for over 800 days, taxpayers are left wondering – whose interests does the Senate majority have at heart?

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ATR & CFA Encourage House to Pass Cut, Cap and Balance Act


Posted by Mattie Duppler on Monday, July 18th, 2011, 3:50 PM PERMALINK


Today, Americans for Tax Reform and its Center for Fiscal Accountability urged Members of Congress to support the Cut, Cap and Balance Act when it comes to the floor tomorrow. After the conservative movement made clear again today that tax hikes are off the table in the debt limit debate, the CCB bill represents a serious proposal to remedy the country's ailing fiscal health. From our letter:

The Act would cut $111 billion in discretionary spending next year. While the legislation leaves significant room for further restraint in defense spending, this cut would still be an important step towards curbing the massive discretionary spending growth of the past few years.

H.R. 2560 would also establish statutory spending caps that would set total federal spending on a glide path down to its historical average of 19.9 percent of Gross Domestic Product (GDP). While continued efforts should be made to bring this spending in line with the historical average for revenues—18 percent—this too signifies a departure from projected spending, which is expected to average 23 percent of GDP for the next ten years.

Lastly, the bill would require a Balanced Budget Amendment to the United States Constitution be passed by Congress before additional borrowing authority can be exercised by Treasury.  The legislation specifies the amendment would have to satisfy the critical requirement of a two-thirds majority of both chambers in order to raise taxes, ensuring taxpayers will not be on the hook for the foolhardy spending practices of reckless lawmakers.

The Cup, Cap and Balance Act of 2011 represents the most serious legislative proposal offered in the debt limit debate. Members of Congress concerned about restoring the United States’ credibility and financial health should endorse this effort to implement lasting spending reform.

Click here to read the letter in its entirety.

Do you support the CCB Act? What do you think should be done in exchange for raising the debt limit?

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ATR Does Not Support Any Specific Debt Limit "Contingency" Plan


Posted by Mattie Duppler on Tuesday, July 12th, 2011, 6:58 PM PERMALINK


Today, Americans for Tax Reform President Grover Norquist did not endorse any particular debt limit contingency plan, as has been alleged. He did endorse the objective of Leader McConnell’s effort to force the President to put his spending plan in writing.

Earlier, Senator McConnell announced a "contingency" plan, the goal of which is to make President Obama own up to the lie he's been telling taxpayers for the past two years: he has no specific plan to cut spending. Congressional Democrats will have to admit the jig is up for them as well.

The McConnell plan requires the President to submit, with a request for $700 billion in more borrowing authority, a package of spending rescissions of the same or greater value. Up until this point, the debate on extending the debt ceiling has been framed as one of President Obama offering unspecified "reasonable" tax increases for spending cut promises. The problem, which we have detailed at length, is that no tax hike policy could ever solve what is a spending problem. The President has been allowed to promote imaginary spending cuts to which he would accede in order to get Republicans to agree to tax hikes. Republicans didn't bite. But President Obama, up until today, didn't have to disclose what imaginary spending cuts he was so reasonably prepared to accept.

ATR wants to ensure a debt limit deal contains the maximum amount of real spending cuts and absolutely no tax increases. Leader McConnell has put forth a plan that attempts to put this goal in motion. ATR looks forward to reviewing other strategies that could also achieve this goal.

Leader McConnell is trying to force the President to put his alleged spending plan in writing. ATR supports this effort in general but not any plan in particular. The onus is now on the President to admit to the American people he has no plan to cut spending – put up or shut up.

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Instead of Budgeting, Senate Democrats Look to Regulate


Posted by Mattie Duppler on Tuesday, July 12th, 2011, 4:48 PM PERMALINK


Faced with increasing unemployment and a stagnating economy, Senate Democrats have refused to pass a budget for over 800 days, content instead to distract with proposals that would throw the country’s fiscal health into further decline. Last week, Senator Herb Kohl (D-Wis.) called on Department of Transportation officials to throw the weight of the federal bureaucracy behind his legislation that would repeal current antitrust law and unfairly burden railroads with new regulatory regimes.  By going after one of America’s most productive and oldest industries, the Senator shows aggressive regulatory fiat seems to be a siren song few lawmakers in search of bigger government can resist.

While the current fiscal environment provides little appetite for yet another job-crushing regulation, it’s worth noting how off-base Kohl’s proposal is, especially with several transportation bills waiting in the wings once the debt limit debate expires.

The federal regulatory morass that governs most industries is both convoluted and barely navigable for companies attempting business. As detailed in our discussion of food safety oversight during the FDA Modernization Act debate, conflation amongst and between departments and agencies is common; to Senator Kohl, streamlining oversight of railroads by providing limited antitrust exemption represents a dearth of regulation, not a product of its excess.

Railroads are overseen by the Surface Transportation Board (STB) while still subject to nearly all antitrust laws. This, in effect, creates double-tiered regulation that maintains the same antitrust standards to which other industries are held backed by independent supervision by the STB. This sort of regulatory maze is not unique to railroads – many industries are subject to the same kind of duplicative oversight, and as a result are allotted their own exemptions from certain antitrust regulations that paint with too broad a stroke the guidelines for all commercial activity.

Worse, retracting railroads’ antitrust status would unravel the current state of play between regulators and legislative guidelines. This would leave varied interpretation between courts, regulators and policymakers of how railroads are allowed to proceed with doing business. With the current tax climate, unsustainable government spending and onerous regulatory regime already generating market uncertainty, passing a bill that would discourage economic productivity should be a nonstarter in this Congress. As Kohl’s time in the Senate dwindles, this latest regulatory overstep begs the question: if it ain’t broke, what exactly is the Senator trying to fix?

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