Dieting…Federal Budget Style

Ballooning Deficits and Higher Taxes are a Recipe for Disaster:
The President unveiled his budget with 10 year projections on February 26 which will increase the national debt from today’s level of $10.8 trillion to $23.1 trillion in FY 2019. From reading the budget, there are many things that concern me. With respect to cutting the projected $1.75 trillion budget deficit (which is higher than the last five years combined) in 2009 in half by 2013, it’s easy to claim you have cut the deficit in half after you’ve just tripled it. No one starts a diet by gaining 100 pounds to lose 50. Furthermore, the projected deficit of $533 billion in 2013 would still be the largest deficit of any year in history prior to this year. The budget also includes $634 billion as a first installment to creating a government-run health care rationing regime and a $750 billion placeholder for a second round of TARP spending without any clear explanation about how or where the funds may be used. Both of the aforementioned items will require more borrowing, not to mention the interest associate with them. Even the New York Times, in a front page article on 1/25/09, called the budget a “pronounced move towards redistributive wealth.”

Not only does the budget resurrect the death tax in 2011, it exacerbates the housing problem in the United States by limiting the itemized deductions for mortgage interest and real estate deductions. Disincentivizing housing purchases during an economic downturn caused by a housing market meltdown does not seem to me to be the best way to remedy the situation. 

When added to the recently passed stimulus, America’s discretionary (excluding Medicare, Medicaid, Social Security, etc.) budget will have risen 24% this year. I have grave concerns about the budget’s impact (in particular the $1.4 trillion in tax increases) on retirees, small businesses, and nonprofits/charities. If you accept the budget on its face, you must also accept the premise that tax increases have no impact on individual or small business behavior. And, because the budget makes no attempt to reign in spending as a means of deficit reduction, taxes will likely be increased on more than just the top 2% of American wage earners, whom this budget purports are the only ones who will see a tax increase. Retirees would be particularly hurt by the increase in capital gains taxes and dividend taxes in this budget. This as many Americans have seen their retirement portfolios depleted in recent months.

By allowing the 2001 and 2003 Bush tax cuts to expire, small business owners filing as individuals will be adversely affected. Small businesses are the economic engine of America – they create 70% of new jobs each year. Punishing hard-working Americans is not the way to encourage economic growth.

Charitable organizations will experience a significant decline in giving because the budget would reduce the value of charitable deductions for individuals making more than $164,000 and families making more than $208,000. The negative effect of this change will be felt by nonprofits, churches, faith-based schools, hospitals, and other charities.

The encroaching hand of government as big brother is even more pronounced in this budget. Rather than let market forces work, this budget would impose burdensome, heavy-handed, and, quite frankly, job-killing regulations on American industry. After celebrating the tax cut 95% of Americans are to be receiving, this budget levies a $646 billion energy tax which will impact anyone who uses electricity, drives a car, or relies on energy (i.e., natural gas, electricity, home heating, and gasoline) in any way. To be sure the massive tax increase used to usher in a “cap and trade” regime would decimate American manufacturing jobs and destroy many American industries. As most economists acknowledge, much of the tax burden on companies affected by “cap and trade” will just be passed on to the consumer. Consumer goods, which must be transported across the country, will increase in price and hurt those with the least amount of disposable income.

Overall, this budget represents a drastic shift away from a free market economy towards a nation with a budget and economy that is crippled with new and ever-expanding entitlement programs. Harking back to the fall debates, I see little evidence that either a hatchet or scalpel was used in the devising the budget. Rather than focusing on class warfare, I believe we need a budget that reigns in spending and allows American families to keep more of what they earn while easing the burden on small businesses so they can retain and hire new employees.

Protecting and Defending Pro-Life Riders

Bipartisan effort to continue ban on use of taxpayer money to fund abortions:
Last week, I signed a letter (authored by Jim Jordan (R-OH) and Heath Shuler (D-NC)) from a bipartisan group of my colleagues to Speaker Pelosi, House Appropriations Committee Chairman Obey, and House Rules Committee Chairwoman Slaughter asking that they do not remove pro-life riders from appropriations bills. Some of the riders include provisions such as the Hyde Amendment which prohibits taxpayer dollars from being used to promote or perform abortions and a provision protecting the conscience of health care professionals. These riders and others have been included in bills no matter which party controlled Congress. If, however, the decision is made to strike these important provisions from appropriations bills, we have asked for an up or down vote on removing or maintaining each pro-life rider. You can view the letter at: http://downloads.frc.org/EF/EF09B40.pdf.

This week’s votes on the floor, hearings, and markups

Each week I get the opportunity to represent you in Congress by: 1) voting on legislation that comes to the House floor; and 2) participating in committee hearings and markups for the Committee on Financial Services. 

Key House Floor Votes

Omnibus Appropriations Bill passes with nearly 9,000 Earmarks:
On Wednesday, February 25th, I opposed H.R. 1105. Less than two weeks after a $787 billion earmark-stuffed non-stimulus package was passed, a $410 billion omnibus appropriations bill was rammed through Congress at lightning speed. Because we are operating under a continuing resolution, the omnibus was used to wrap up almost all FY ’09 appropriations bills into one omnibus bill. The spending in this bill, however, represents an 8.4% increase over FY ’08 and a 4.9% over President Bush’s original FY ’09 request. The American people are right to demand fiscal responsibility. They did not get it when thousands of earmarks were inserted into the stimulus and they did not get it here when 9,000 more earmarks were inserted.

Among the 9,000 earmarks included in the bill were:
• $45,000,000 for Streetcar Loop grants in Portland, Oregon
• $7,100,000 for the recovery of Hawaiian sea turtle population
• $5,800,000 for a Edward M. Kennedy Institute for the Senate at the University of Massachusetts
• $5,000,000 for San Francisco Bay restoration
• $2,100,000 for the Center for Grape Genetics in New York
• $1,700,000 for swine odor research and manure management in Iowa
• $1,000,000 for red snapper research in Florida
• $1,000,000 for Mormon cricket control in Utah
• $951,500 for an anti-idling lithium ion battery program in California
• $951,000 for a sapphire algae to fuel demonstration project in New Mexico
• $900,000 for planetarium equipment in Chicago
• $800,000 for a fish passage project in Washington
• $713,000 for “intelligent facades for high performance green buildings” in New York
• $475,000 for the “elimination of blight” in Highland Park, Michigan
• $475,000 for a parking garage in Utah
• $445,000 to map the Hudson River to “build resiliency to climate change”
• $332,500 for Bronx Zoo Intermodal Transportation Facility
• $300,000 for the Montana World Trade Center
• $250,000 for Lahontan Cutthroat Trout management in Nevada
• $200,000 for the Polynesian Voyaging Society in Hawaii
• $143,000 for Nevada Humanities “to develop and expand a comprehensive online encyclopedia”

Apart from the spending, there were many other provisions which concerned me. First, it removes funding for the highly-successful D.C. school choice program. The D.C. Opportunity Scholarship, as it is formally known, is a model for a successful program that serves inner city children well by providing high quality education to students who need it the most. This bill removes the ban on the Fairness Doctrine that was included in the FY ’08 omnibus. It also includes $310 million for the National Endowment for the Arts, an increase of $21 million from FY ’08. This comes after they received $50 million in the stimulus 2 weeks ago.

With respect to healthcare-related issues, this bill raised objections from many pro-family groups. First, it permits non-federally funded clinics like Planned Parenthood to purchase drugs (i.e., the morning after pill) at discounted prices. Second, the bill decreases funding for abstinence education and increases Title X funding for organizations including Planned Parenthood. Lastly, the bill undermines the Kemp-Kasten provision which has been included in every appropriations bill since 1985. This provision has allowed Presidents to waive funding to the United National Population Fund because of their support for China’s coercive abortion practices.   

Committee on Financial Services

Loan Modifications:
On Tuesday, February 24th, the Subcommittee on Housing and Community Opportunity held a hearing entitled, “Loan Modifications: Are Mortgage Services Assisting Borrowers with Unaffordable Mortgages.” Testifying before the Subcommittee were high-ranking officers from: U.S. Department of Housing and Urban development; Office of Thrift Supervision; Office of the Comptroller of the Currency; Federal Housing Finance Agency; Ocwen Financial Corporation; Wells Fargo Home Mortgage Servicing; Bank of America; JP Morgan Chase; and Citigroup. During the hearing, I expressed real concern about the high re-default rates on modified mortgages as well as frustration with the regulators for lack of action.

Humphrey-Hawkins Hearing:
On Wednesday, February 25th, the Committee on Financial Services held a hearing entitled, “Monetary Policy and the State of the Economy.” Testifying before the Committee was Federal Reserve Chairman Ben Bernanke who was giving his statutorily-required semiannual report to Congress known as the Humphrey-Hawkins Hearing. Chairman Bernanke’s written report can be accessed at the following website: http://www.house.gov/apps/list/hearing/financialsvcs_dem/mpr_final_02-23-09_booked.pdf.

Upcoming Events in the 24th District

Artistic Discovery Congressional Art Contest
This year celebrates the 28th Annual Congressional Art Competition—An Artistic Discovery.  The nationwide art competition, which is voluntarily sponsored by Members of Congress, allows creative high school students to showcase their talents in Washington, D.C. in the U.S. Capitol Building. The first place winner in each Congressional District will have their winning entry displayed at the U.S. Capitol for one year. The winning artist will be invited to fly to Washington, D.C. for a national reception honoring the winning artists from all over the country.
 
I would like to encourage all high school students residing in the 24th District of Texas to participate in this contest. All entries are due by Friday, March 13, 2009. Entries must have a student release form attached to the back of the work. Student release forms and guidelines are available on our website or can be obtained by contacting the District Office at (972) 556-0162.

The contest is open to all high school students including homeschoolers. The following types of medium are acceptable: paintings (oil, acrylics, watercolor); drawings (pastels, pencil, charcoal, ink, markers); two-dimensional collages; prints (lithograph, silkscreen, block prints); mixed media; computer generated art; and photography. All work must be original in concept, design, and execution, and must not violate any U.S. copyright laws. I look forward to receiving your artwork.

North Texas U.S. Service Academies Forum 
Date- Saturday, April 4, 2009
Time- 8:00am -12:00 noon
Location- Tarrant Country College, Southeast Campus
               North Ballroom
               2100 Southeast Pkwy
               Arlington, Texas 76018

One of the most important roles I serve as a US Congressman is to nominate young men and women to attend the Service Academies. This event is for students interested in attending one of the five U.S. Service Academies (U.S. Air Force Academy, U.S. Military Academy, U.S. Naval Academy, U.S. Coast Guard Academy, and U.S. Merchant Marine Academy). The Academies Forum is an informational event that will provide students an opportunity to learn more about the various academies and application procedures. 

The event is free and open to the public. Parents are encouraged to attend with their students.  Attendees will have an opportunity to talk with Cadets and Midshipmen as well as representatives from the Academies. 

The U.S. Service Academies are an alternative to traditional universities. While students obtain a bachelor’s degree at the Academy, they are also trained to become America’s next military leaders. Admittance into the Academies is highly competitive and dependent on a nomination from your local Congressman or one of the two U.S. Senators. I encourage all students interested in obtaining a nomination to contact my District Office.
 

This week in history

In 1803, the U.S. Supreme Court establishes judicial review in Marbury v. Madison.

In 1868, Andrew Johnson becomes the first President to be impeached.

In 1870, Hiram Revels, a Republican Senator from Mississippi, becomes the first black member of Congress.

In 1951, the 22nd Amendment to the Constitution, limiting President to two terms, is ratified.

I am honored to represent the 24th District of Texas, and appreciate your interest in my e-newsletter.  Please contact my District or DC office with any further questions you may have or visit my website at www.marchant.house.gov.