Source; Sent from a friend......
While tax cuts, to let people keep what they earn (which by the way helps limit the growth of BIG government), can and do increase federal deficits and debt, the federal fiscal imbalance is mostly a consequence of spending growth by government exceeding the growth of US economic output to pay for it, which in turn occurs primarily because of legislation, why federal finances are so badly out of balance and getting worse.
It is clear that the GOP put a lot of thought into their bill to raise the debt ceiling, officially named the 2023 Limit, Save, and Grow Act (LSGA). Much, in fact, than biden and liberals/democrats put into making the laughably titled inflation reduction act (IRA) reduce inflation or strengthen the American economy.
Contrary to the shrill claims made in the left-wing media, the US will not necessarily miss debt payments, much less default on its debt, if the debt ceiling is not raised by June 1. There are a lot of discretionary programs and spending that can be cut. Domestic bill payments can be delayed, and agencies or departments can be closed while negotiations continue and the debt is serviced. There is no reason, however, for the country to hit that deadline. The solution is to accept the perfectly reasonable spending cuts and provisions developed by the Republicans. The House’s hard line on spending comes at a time when, according to a recent poll by Pew Research, nearly 60% of Americans list reducing the budget deficit as a top priority.
The LSGA would require reducing discretionary spending at various departments and agencies to their fiscal 2022 levels. These would be real reductions, not just a slowing of the rate of growth, as often accompanies end-of-year omnibus budget bills or previous debt ceiling increases, which have traditionally falsely portrayed by liberals/democrats as “drastic cuts.”
The growth in federal spending has been crazy in recent years, far above the rate of inflation, as the government has inserted itself ever more deeply into peoples’ lives and personal choices, such as dictating whether they have to pay rent; stay at home; what their children have to be exposed to in school, in locker rooms, and on playing fields; and what cars, appliances, and energy sources they can have. If the discretionary spending reductions in the House bill stand, spending by federal agencies could only grow by 1% per year for the next decade.
Does this mean agencies can’t do their jobs? Of course not. But it would require them to slow their mission creep, which lately could more appropriately be called “mission blitzkrieg.” It would force regulators to act like the rest of us and make tradeoffs. We might have some hope that agencies would follow the actual missions set for them in law.
The budget cuts might force the EPA, for instance, to limit its actions to regulating criteria pollutants and toxins covered by various clean water and air acts, instead of restricting CO2 (which isn’t mentioned as a pollutant in the Clean Air Act) or limiting people’s land uses based on federal “wetlands” protections (which is nowhere explicitly mentioned in the Clean Water Act), or spending billions on “environmental justice,” however ill-defined, which is a creation of executive orders, not any law passed by Congress. These forced spending cuts would also reduce the role of the federal government in states’ educational systems and power grids, leaving those matters to the states where they belong and long resided without federal interference and mandates before the Depts of Education and Energy were created under incompetent President carter. Can anyone with a straight face say test scores and energy security have improved since the creation of these vast agencies with roles not enumerated in the U.S. Constitution as belonging to the federal government? Of course not. These provisions would have a huge impact in reining in out-of-control federal spending and the egregious overreach it allows into the states’ lawful authority and individual peoples’ lives.
The LSGA would also impose limited work or training requirements on some Medicaid recipients. Medicaid was established as a social safety net to ensure medical care for the poorest Americans, their children, and some people with disabilities. The Medicare rolls have grown dramatically as the federal government expanded coverage beyond those living in poverty. The Republican debt limit bill doesn’t end or even sharply curtail Medicare payments to the states. As the Kaiser Family Foundation notes(1), the bill would require certain able-bodied adults in the program to work part-time, undergo training, or participate in other qualifying activities to continue to receive the federal share of Medicaid. This shouldn’t be controversial. No one should want to be on welfare or receiving aid or charity. Work benefits workers themselves, building wealth, character, and self-esteem, and society as a whole. If taxpayers are going to pick up able-bodied adults’ health care costs, the least the recipients should do is work a little or try to find work. All Republicans are asking is that those who can work make an effort to do so and thereby improve their lot in life.
The LSGA also rescinds the $70 billion given to the Internal Revenue Service under the IRA to hire 50,000 to 80,000 new armed agents. biden claimed the new tax enforcement agents would not harass middle- and low-income people and would focus on wealthy tax cheats. This promise rings hollow. Nowhere does the IRA limit the scope of the IRS’s activities to investigating the wealthy, and the wealthy have the resources to exploit every tax loophole and credit, whereas average folks can’t afford the advisors to help them take advantage of dodges hidden in the intricate provisions of the tax code. IRS agents will go after the low-hanging fruit in their investigations. It’ll be easier to prosecute you even though the resulting tax revenues, fines, and penalties will be small.
The LSGA would also claw back the remaining unspent billions in COVID relief money. As Speaker McCarthy said: “The American people are tired of politicians who use COVID as an excuse for more extreme inflationary spending. Now, if this money was authorized to fight the pandemic and was not spent during the pandemic, it should not be spent after the pandemic is over." This should be a no-brainer.
The LSGA would also cancel biden’s lavish vote-buying ploy of debt relief for student loan borrowers. There is no reason whatsoever to allow people who benefited from student loans to avoid paying them back. It is perverse to force those who paid off their student loans, or who never took out student loans and instead got on with the business of life by going to work in careers not needing a college degree, or who paid for their degrees not by borrowing but by working and/or earning merit-based scholarships, or other taxpayers and future generations to send money to students who borrowed to get degrees (often in fields that have limited value in the real world) but now find it hard to pay them back while living the lifestyle they think their degree entitles them to. You borrow the money, you pay it back. That may seem harsh to the snowflakes, but millions of hard-working people in debt with mortgages, car loans, and credit card debt do it every day.
The LSGA includes several other critical provisions. One element would rescind the subsidies and open-ended tax credits for biden’s dangerous green energy transition. The IRA provided generous subsidies and tax credits for people to add solar panels to their roofs and purchase electric vehicles (EV), subsidies to build more grid-scale solar and wind projects and the transmission lines to deliver them, subsidies to retrofit homes and businesses to maximize energy efficiency, money to build out the nationwide electric vehicle charging system necessary to keep the highly subsidized EVs running, and a variety of other highly subsidized green energy programs. The Congressional Budget Office estimated the IRA’s energy and climate provisions would cost $391 billion. The Institute for Energy Research notes this is almost certainly a “huge under-estimate” of the ultimate cost because of “lucrative tax credits in the law that are not capped.” Estimates from Goldman-Sachs, the Mercatus Center, and others estimate the true cost of the defective(2) green energy part of the IRA alone could top $1.3 trillion over the life of the program, amounting by itself to approximately 87% of the entire amount the debt ceiling would be raised. None of this spending is authorized in the powers given to the federal government in the U.S. Constitution, nor is it justified by the CO2 emission reductions the entire panoply of programs would supposedly produce.
Importantly and flying large under the radar is a provision that could have the biggest impact on reining in the unwarranted, unsanctioned-by-law, power grab the federal regulatory state has exercised over the years. This provision would require Congress to approve any new major regulation before it could go into effect. Regulations not approved by both houses of Congress couldn’t be offered again for a minimum of one year. While Congress passes laws every year, federal agencies tend to roll out many, many more regulations. LSGA would require Congress to approve each of those actions before they go into effect, under a fast-tracked legislative process that would force up-or-down votes on the rules without any possibility of amendment. Any major rule that failed to pass both houses of Congress could not be proposed again for at least a year. Current law allows Congress to upend a regulation it does not like, but the process requires majority votes by both houses of Congress, and a signature by the president, meaning nearly all regulations go into effect.
1. "Adult enrollees ages 19-55 would need to work or participate in other qualifying activities (like community service or job training) for at least 80 hours per month. There would be exemptions for those who are physically or mentally unfit for employment (as determined by a physician or other medical professional), pregnant, the parent or caretaker of a dependent child or incapacitated person, complying with a work requirement under a different federal program, participating in drug or alcohol treatment or rehabilitation program, or enrolled in school at least half time."
Further reading:
https://heartland.org/opinion/spending-and-prosperity/
https://audioboom.com/posts/8299472-mrmarket-the-us-debt-and-its-discontents-veronique-derugy-mercatus-center
https://www.heritage.org/debt/commentary/why-debt-limit-indispensable-tool-ensure-limited-government
https://justthenews.com/politics-policy/polling/most-americans-dont-support-raising-debt-ceiling-without-spending-cuts
https://www.americanthinker.com/blog/2023/05/when_reality_hits_it_will_hit_hard.html
https://www.foxnews.com/opinion/debt-ceiling-fight-republican-medicaid-plan-shows-how-make-work-requirements-work-right
https://www.americanthinker.com/blog/2023/05/befuddled_paul_krugman_should_study_hankes_annual_misery_index_hami.html
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