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E-News 2/18/11

The Week: A Big Budget, Big Spending Cuts, A Dubious Anniversary

President’s Budget: More Spending, Borrowing, Taxing

By the Numbers: President Obama’s Fiscal Year 2012 Budget

Relief for Small Businesses On The Way

Noted with Interest:  Exempted from Obamacare

Recommended Reading: Innovation Made in China

Meeting our Mayors

Rodney’s Latest Listening Session Next Tuesday

 

The Week: A Big Budget, Big Spending Cuts, A Dubious Anniversary

“There is no doubt that our nation finds itself in a spending-driven debt crisis.  This week saw an interesting confluence of events.

“First, the President unveiled his official budget for the fiscal year that begins next October 1.  Unfortunately, like his previous budgets, the President’s $3.8 trillion spending plan this year contains too much spending, taxes and borrowing.

“To create jobs and employment opportunities, we have to stop spending money we don’t have.  Right now, we are borrowing 42 cents on the dollar, much of it from the Chinese, to pay for historically high spending. 

“Of course, historic debt leads to record tax increases, which will lead to serious unemployment. 

“Second, recognizing the growing danger of this spiral, the House this week worked toward passage of an historic budget-cutting ‘Continuing Resolution.’  After a week of open, vigorous debate, the resolution I will vote for will implement $100 billion in spending reductions to a wide range of government programs.

“Many of the votes this week were very tough.  Some of the budget cuts will be deep and painful. 

“However, they had to be made.  Simply put, our nation is broke.

“I hope our Senators and the President also see the need to slash spending and work with us in a bipartisan way in the weeks ahead.

“But recent history does not offer many reasons for optimism.  The release of the President’s 2012 budget and our House vote on a delayed 2011 budget both came as the nation marks the second anniversary of the passage of the President’s so-called ‘stimulus’ legislation.

“In early 2009, the President promised that if the ‘stimulus’ package was signed into law, our national unemployment rate would not exceed 8 percent.  He also promised that the ‘stimulus’ package would save or create 3.5 million jobs.

“With a final price tag of over $1 trillion, the ‘Stimulus’ package did nothing but add to our out of control national debt which now stands at over $14 trillion. 

“After a record 21 months of unemployment at 9 percent or higher, the ‘stimulus’ clearly failed to live up to the expectations the Obama Administration promised the American people.   It did create jobs alright: tens of thousands of bureaucrats were hired by federal and state governments!

“The failure of the ‘stimulus’ should make it crystal clear: we cannot borrow and spend our way to prosperity.  More government spending, fueled by ever higher taxes and more borrowing from foreign debtors, will lead to a dark future for our children and their children.”

                             Rodney Frelinghuysen

Recommended Reading: Congress Earns Its Pay

Kimberly Strassel, writing in the Friday Wall Street Journal, “Congress Finally Earns Its Pay. Unlike years past, the budget debates in the House were vigorous and democratic, not stage-managed by the leadership of the majority party.”

President’s Budget: More Spending, Borrowing, Taxing

The President has recently been outspoken in his support for “making the country live within its means.”  However, the budget he announced this week, for the fiscal year beginning next October 1, appears to be long on rhetoric, new federal spending and taxes and short on spending cuts. 

What’s worse is that the President’s projected $1.65 trillion deficit for the current year would be the highest dollar amount ever, surpassing the $1.41 trillion deficit hit in 2009. It would also represent 10.8 percent of the total economy, the highest level since 1945, reflecting heavy borrowing to fight World War II.

Far from “living within its means,” the President’s $3.8 trillion budget puts the government on track to nearly double in size since the day he took office – a direct result of a reckless spending spree.

With a persistent national unemployment rate of over nine percent, we cannot afford a budget that destroys jobs and opportunities by imposing a $1.6 trillion tax hike, adding $13 trillion to the national debt and fueling uncertainty in the private sector. In fact, the President’s budget contains about $8 of tax increases for every $1 of spending cuts.

“You really cannot borrow and spend or tax and spend your way to fiscal stability,” Rodney said.  “We must go much further than this anemic effort of symbolic reductions and additional spending proposed under the guise of funding ‘freezes’ if we are truly to get our nation’s finances on a sustainable course.”

By the Numbers: President Obama’s Fiscal Year 2012 Budget

 

·        Spends Too Much

·        $3.8 trillion in spending this year; 25.3% of GDP (highest since WWII)

·        $46 trillion in spending over the decade; $8.7 trillion in new spending

·        Taxes Too Much

·        $1.6 trillion tax hike on families, small businesses, and job creators

·        Revenues as a percent of GDP climb to 20%

·        Borrows Too Much

·        $1.6 trillion deficit for FY2012; a record third straight trillion dollar deficit

·        Doubles and then triples debt held by the public since President took office

·        $13 trillion added to the debt over the decade

Relief for Small Businesses On The Way

Most Americans agree that the new Obamacare law is inherently flawed, harmful to the economy and must be repealed.  One of the first acts of this new Congress was to do just that.  However, while we wait for the Senate to approve the full repeal, there are onerous portions of the law that should be replaced now.

To this end, the House Ways and Means Committee yesterday approved legislation, cosponsored by Rodney, to cancel the so-called “1099 provision” of Obamacare – a burdensome rule that forces small businessmen and women to file burdensome tax forms with each vendor that they work with exceeding $600 dollars. This needless tax compliance mandate bogs down businesses - small and large - in paperwork, creating yet another major hoop for them to jump through, instead of allowing them to focus on growing their business and creating jobs.

“Nearly every small businessman and woman I meet in New Jersey says the 1009 provision is one of the most damaging provisions, among countless new mandates, in the new Obamacare law,” Rodney said.  “Repealing ‘1099’ will provide small businesses with much needed relief.  I intend to keep pressing for a quick repeal.”

More than 175 organizations officially support 1099 repeal, including many in the small business community.  This week they sent a letter to Committee Chairman Dave Camp.  Read the letter here.

Noted with Interest:  Exempted from Obamacare

An oversight hearing of the House Energy and Commerce Committee this week uncovered an interesting fact about Obamacare: the number of companies, union organizations and even states that have been granted waivers from key provisions of the new law has jumpedfrom 773 to 915!  View the list here.

Recommended Reading II: Steve Lohr, writes in the New YorkTimes “As a national strategy, China is trying to build an economy that relies on innovation rather than imitation. Clearly, its leaders recognize that being the world’s low-cost workshop for assembling the breakthrough products designed elsewhere — think iPads and a host of other high-tech goods — has its limits…”  Read “When Innovation, Too, Is Made in China,” here.

Meeting our Mayors

As is his custom, Rodney met with over 30 mayors from around the 11th Congressional District this week.  After Rodney provided a report from Washington on efforts to reduce the budget deficit and debt, much of the dialogue centered on reduced assistance to municipalities, efforts to lower personal and corporate taxes and the House’s commitment to create private sector jobs and opportunities.

Rodney’s Latest Listening Session Next Tuesday

Rodney will hold the next in a series of public town meetings on Tuesday, February 22 in Florham Park. All area residents and interested citizens in the 11th Congressional District are invited to attend.

The details of the meeting:

7 p.m.

Tuesday, February 22

Ridgedale Middle School

71 Ridgedale Avenue

Florham Park, NJ 07932

“I hold public town meetings regularly to allow me to hear the voices of local residents,” he said. “The topics are theirs to choose.  The opinions are theirs to give.”