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Record debt vs. trimming spending
34 mins 29 secs ago
Congresswoman Virginia Foxx
In a cruel twist of irony, tax season and Washington, DC’s money-gushing budget season usually overlap.
This year’s irony is crueler than usual. The current budget increases government spending to the highest level since World War II—at 27 percent of our total economic output.
In plain language, this means that the government will do one of two things (or a combination of the two): tax away more than one quarter of our economy, or borrow the money from willing lenders, many of whom are foreign countries.
If North Carolina families struggling with stretched budgets can cut back, why can’t Washington? It doesn’t make sense for Washington to inflate the budget with pet projects and wasteful spending at the very moment when families all across the North Carolina are tightening their belts. Washington should lead by example and make the tough decision to keep a lid on spending.
While I cannot support a budget that bleeds red ink and transfers generations of debt to our children, I do believe we have a strong alternative. That’s why I support the alternative budget offered by the GOP. This budget alternative keeps federal spending in check and refrains from raising your taxes—unlike the Democrats’ budget.
Much of the administration's new spending will come in the form of borrowing—a clever tactic that passes the overwhelming cost of the federal government onto future generations. I like to refer to this as generational theft.
The news media employs other terms to describe the budget. The Washington Post writes that the Democrats’ budget resorts to "gimmickry" to make the budget "look better on paper." But strip away the gimmicks and a stark reality remains: this budget balloons the national debt by $9.3 trillion over the next ten years, according to the Congressional Budget Office (CBO). In contrast, the GOP alternative budget controls the debt explosion—to the tune of $3.6 trillion less debt than the Democrat version.
This record amount of debt confronts us with an important question. Does debt-financed government spending represent the best way to improve the current economic conditions in our nation? The fundamental assumption behind this unprecedented government deficit spending is that the government knows best how to get the economy moving, and they will use your tax dollars to do it.
I disagree with this assumption. Bigger government will not solve our every problem. Industrious and innovative Americans are the key to recovery. Unfortunately, the high taxes that will inevitably result from record-breaking deficit spending will thwart the very people who can help get Americans back to work.
President Obama’s budget is not just about deficits though. As you may have heard, the budget includes provisions for a “cap and trade” scheme that aims to reduce America’s carbon output—and by extension our economic output.
In the quest for accuracy, it has been redubbed “cap and tax” because it represents a nationwide climate tax that
"Shipping jobs overseas will not solve our economic problems."
jacks up everyday energy prices for every American household. That means higher costs for natural gas, electricity, home heating oil and gasoline.
If you thought gas prices were high last summer, wait until you see prices under “cap and tax”. Even President Obama has said that energy prices will “necessarily skyrocket” with a “cap and trade” program.
It gets worse. The National Association of Manufacturers estimates that this “cap and tax” proposal will lead to 3-4 million jobs moving overseas due to higher energy costs in the United States. Shipping jobs overseas will not solve our economic problems.
Rather than hiking taxes, the GOP budget plan allows small businesses with fewer than 500 employees to deduct 20 percent of their income, which will spur economic growth at the real source of job creation. And instead of taxing American energy with a “cap and tax” plan, our alternative budget uses revenue from new energy exploration to invest in alternative energy research.
This proposed budget increasingly looks like a spending spree on the national credit card. The CBO projects record deficits in 2010 all the way through 2019 and there is hardly a spending cut in sight—despite the fact that North Carolinians are cutting back in almost every area of the family budget.
The differences between the two budgets are remarkable and hint at two divergent approaches to running the federal government. One approach pursues more government, more government spending and more debt. The other trims the waste, keeps taxes low and focuses on helping small business create new jobs.
Government intervention in the economy has already proven disastrous. Think AIG bailouts and TARP slushfunds for failed banks. As we watch our economy become increasingly dependant on the whims of government managers, the time has come to rein in the federal budget and tame Washington’s spending habit—and the GOP alternative contains the fiscal restraint necessary to do just that.
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