E-News 3/4/11

1) The Week Just Past: Progress on Cutting the Federal Budget

2) The Department of Overlap: Bureaucracies Everywhere!

3) Department of Overlap: By the Numbers

4) Relief for Small Business

5) Working in Committee


The Week Just Past: Progress on Cutting the Federal Budget

“As I travel around New Jersey, I hear two very clear views from the people I meet: 1) the want their federal government to remain open for business; and 2) they want us to cut the federal budget!

“The House and Senate this week passed legislation that moves us toward both goals.  The measure prevents a government shutdown tonight AND takes another small step toward restoring fiscal sanity to our federal budget by immediately and permanently cutting $4 billion.  In fact, the bill actually terminated several government programs.  Believe me, in a city where Ronald Reagan once said ‘a government bureau is the nearest thing to eternal life we'llever see on this earth,’ that’s quite an accomplishment!

“It is important to note that the resolution we passed this week will only keep the federal government running for another two weeks.  So, between now and then, comes the hard work of hammering out an agreement with the President and Senate Democrats to produce a responsible budget that cuts spending in measurable, significant ways.  The starting point for these discussions will be the House-passed budget bill, also known as the Continuing Resolution or CR, which cuts the President’s budget by over $100 billion.

“For my part, I will do my best to work in good faith to accomplish this goal.  I hope everyone can avoid engaging in the political gamesmanship that will hamper this incredibly important task.”

                                      Rodney Frelinghuysen

Recommended Reading: Unless you did not notice, most economists agree about the grave threat posed by our sky-rocketing national debt.  Reuters this week published "Economists list U.S. budget deficit as No. 1 worry.”  

The Department of Overlap: Bureaucracies Everywhere!

The Government Accountability Office (GAO) released a study this week that reported that “reducing or eliminating duplication, overlap, or fragmentation could potentially save billions of taxpayer dollars annually and help agencies provide more efficient and effective services.”

... “Considering the amount of program dollars involved in the issues we have identified, even limited adjustments could result in significant savings,” the GAO said.  According to the GAO, not only has Congress been busy spending money on duplicative efforts, but the government has neglected to investigate numerous programs, making the expenditure of some funds not only redundant but wasteful.  For instance, only five of 47 job training and employment programs surveyed by the GAO had been studied to evaluate whether outcomes were the result of the program itself or another cause altogether.  “Little is known about the effectiveness of most programs,” the GAO said.

“This report supports what I have been saying for years: we should undertake a serious clear-eyed, dispassionate review of every government program.  We should determine which programs are effective, which programs are duplicative or redundant and which programs are a flat-out waste of money,” Rodney said.  “Ronald Reagan once famously said, ‘no government ever voluntarily reduces itself in size. Government programs, once launched, never disappear.’  We owe it to the taxpayers to make sure that every program that is NOT effective disappears.” 

Department of Overlap: By the Numbers

The Wall Street Journal on Tuesday published some examples of the GAO report on duplication in the federal bureaucracy:

Here are some of the highlights from that GAO report:

1. Food safety: 15 agencies are involved in implementing numerous federal laws.

2. Defense: Numerous redundancies in the purchasing of tactical wheeled vehicles, procurement, and medical costs.

3. Economic development: 80 different programs spread across numerous agencies, often with similar goals.

4. Surface transportation: More than 100 programs run by five divisions within the Department of Transportation deal with surface transportation.

5. Energy: Eliminating duplicative federal efforts to increase ethanol production could save $5.7 billion each year.

6. Government information technology: 24 federal agencies deal with information technology.

7. Health: The Defense Department and the Department of Veterans Affairs could work together – instead of separately – to modernize their electronic health records systems.

8. Homelessness: More than 20 federal programs deal with homelessness.

9. Transportation Security Administration: Assessments of commercial trucking overlap with another federal agency.

10. Teachers: 82 programs that deal with teacher quality, spread across multiple agencies.

11. Financial literacy: 56 programs dealing with financial literacy.

12. Job training: 44 employment and training programs.

Read the GAO report here.

Relief for Small Business 

The new Obamacare law expanded tax information reporting rules by requiring businesses to issue a “Form 1099” for many payments that exceed $600 per year per payee.

For example, imagine picking up donuts twice a week for your business’s staff meeting and then having to send the donut shop a 1099 to fill out.

Or how about the Morris County small business owner who travels extensively? Under the law he would need to file a 1099 for every hotel he may stays in or every restaurant where he eats if spends over $600 throughout the year.

This new requirement will impose a huge tax compliance burden on small businessmen and women, forcing them to devote resources to tax filing instead of to business expansion and job creation.

According to the National Federation of Independent Business (NFIB) this newly enacted reporting requirement will have a “direct negative impact on small businesses,” and more than 170 small business organizations have called for its repeal.

The House yesterday voted to approve legislation, co-sponsored by Rodney, which repeals the onerous 1099 provision.

The 1099 repeal legislation is dedicated to protecting small businesses, their workers and American taxpayers.  The measure:

1.    Repeals onerous tax reporting provisions the President signed into law last year to help pay for both his Obamacare and “TARP III” legislation;

2.    Protects taxpayers by reducing waste, fraud and abuse in the Obamacare law; and,

3.    Reduces the deficit by $166 million in the first 10 years and by billions of dollars over the long run, while reducing federal spending by nearly $20 billion over ten years.

1099 Repeal – By the Numbers

$166 million:Amount by which the 1099 repeal legislation reduces the deficit over ten years

$20 billion: Amount by which the 1099 repeal legislation reduces federal spending over ten years

$19.7 billion: Amount by which the 1099 repeal legislation reduces taxes over ten years

Recommended Reading II: Bill McGurn’s column in the Wall Street Journal on Tuesday, “The Democrats’ Collective Bargain.”

Working in Committee

Rodney’s three Appropriations Subcommittees were active this week.

He chaired two hearings of his Energy and Water Development Subcommittee. On Tuesday and Wednesday, the Subcommittee took testimony from the Director of the National Nuclear Security Administration on the condition of America’s stockpile of nuclear weapons and the future of the Navy’s missile submarine program.

Rodney also participated in a Wednesday morning hearing of the Defense Subcommittee during which he questioned Secretary of Defense Robert Gates about U.S. efforts to evacuate and protect American citizens in Libya and the potential for establishing a “no fly zone” over Libya.  You can read more about the exchange between Rodney and Secretary Gates here.

Rodney also participated in a Wednesday afternoon hearing of the Homeland Security Subcommittee where Secretary Janet Napolitano testified.