The economic downturn has seriously impacted individuals and families across America. During these difficult times, Congress must act prudently to strengthen our economy and assist those who are struggling. At the same time, with our national debt currently at $11.5 trillion and growing, amounting to more than $37,600 per American, it is more important than ever that Congress exercise fiscal discipline and restraint.
At the beginning of 2009, Congress began discussions about an economic stimulus package. The President said that the bill should be timely, temporary and targeted. Unfortunately, the legislation that was drafted by House and Senate Leadership met none of those tests. The funding has not been allocated in a timely manner. The Congressional Budget Office (CBO) estimated when the bill was signed into law that half of the discretionary spending would be spent in 2011 and beyond. U.S. Government Accountability Office (GAO) bimonthly reviews are proving that forecast to be accurate. The funding has not supported temporary initiatives. In fact, the package dedicated $97 billion dollars to 33 new programs, and the GAO reported in a review of Pennsylvania's use of the funding that "program funds are being directed to help Pennsylvania stabilize its budget and support local governments, particularly school districts, and being used to expand existing programs." Finally, this funding has not been targeted at projects and programs that promote economic growth. Although there was strong bi-partisan support for jumpstarting the economy by putting money into needed infrastructure improvements, "shovel-ready" infrastructure projects account for only 3.6% of funding in the stimulus. Of the more than $1 billion that Pennsylvania will receive to repair aging roads and bridges, according to the Commonwealth's July 10 progress report, only $12 million had been spent.
While I believed that action needed to be taken, I could not vote for a plan that would cost the American people $1.1 trillion and push our budget deficit to $1.2 trillion, more than twice last year's record deficit and 12% of our GDP. I supported an alternative plan which would have created 6.2 million jobs over the next two years and cost half as much as the package that ultimately became law. By focusing primarily on job-creating, hard infrastructure projects, and providing individuals, small businesses, and manufacturers with targeted tax relief, this alternative would have created twice the jobs at half the cost. It also would have made unemployment benefits tax-free so that individuals between jobs could focus on providing for their families
Although I did not agree that the bill that was signed into law was the best way to stimulate the economy and generate job growth, now that it is law, I am committed to working with the Administration, the Governor and local officials to ensure that taxpayer dollars are being spent appropriately.
I do not believe the FY2010 budget that was adopted by Congress this year and now serves as the blue print for the federal appropriations process sets the right priorities for our country, especially during these difficult economic times. This budget, which tops off federal spending at $4 trillion for this year alone, will consume 28.5% of our nation's economy, doubling the national debt in five years, and tripling it in ten. Simply put it spends too much, borrows too much and taxes too much.
I supported an alternative budget plan that would have achieved lower deficits than the Democrat plan in each subsequent year and, by 2019, yield half the deficit proposed by the President. By reining in deficits, this plan would control the debt held by the public, achieving $3.6 trillion less in national debt during the budget period. This budget alternative would have placed our nation on a fiscally sustainable path by establishing tough budget enforcement mechanisms and setting realistic spending priorities.
One of my greatest concerns for the future of our country is the unsustainable growth of entitlement spending. This spending represents a legal obligation of the federal government, which must make payments to the recipients who meet prescribed criteria. Each year, entitlement spending takes up a larger percentage of the total budget. As the baby boomers begin to retire and start collecting Social Security and Medicare in ever-growing numbers, the problem of massive entitlement spending will only get worse.
To restrain the growth of entitlement spending, I am a cosponsor of the bipartisan Securing America's Future Economy (SAFE) Commission Act. This legislation would establish a two stage plan that provides for several months of town hall meetings across the country and other methods to gauge public sentiment. After obtaining a broad sampling of public opinion, this Act would then create a bipartisan commission (similar to the Base Closure and Realignment Commission -- BRAC) to produce a report to Congress and recommend legislation to rein in entitlement spending and reform the tax system to restore long-term fiscal sustainability. Congress would be required to enact the recommendations of the Commission or come up with its own proposal. Entitlement spending is one of the most difficult but important issues facing Congress. I believe the SAFE Commission will be an important tool in identifying ways to address this looming crisis.
Tax Simplification and Relief
I am an original cosponsor and strong supporter of legislation to simplify the tax code and reduce the burden on American families, workers, and employers. The Fair and Simple Tax (FAST) Act would bring common sense to our tax structure as a step towards reducing uncertainty in our economy. This legislation would provide a new, optional, single page tax form with a new set of brackets:
- 10% on the first $40,000 in income;
- 20% on $40,000 to $150,000; and
- 30% on any income above $150,000.
This Act would also eliminate the "death tax," fix the Alternative Minimum Tax (AMT) by adjusting it for inflation, reduce the capital gains tax from 15% to 10%, reduce the corporate income tax rate from 35% to 25%, and create incentives for investment, personal savings, retirement and healthcare planning.
I believe that if we give Americans greater control over their own money, they will succeed and prosper, and our economy as a whole will grow.