E-News 8/5/11

The Week Just Past: Priority #1 - Job Creation

Rodney’s statement on the Budget Control Act

The Budget Control Act Outlined

Signs of the Times: Consumer Spending Down, Manufacturing Growth Slows

From the “We’ve Heard This Before” File:  Trade Pacts to Advance

Read Rodney: Obamacare Damages Medicare

Recommended Reading: Women On Submarines

Noted With Interest: Death Toll Rises in Syria; Where are We???

The Week Just Past: Priority #1 – Job Creation

“As you are aware, Congress and the President this week reached an historic agreement that cuts spending and reforms how Washington manages its budget. The compromise prevented a Treasury default and boosted economic certainty by ensuring that America pays its bills while taking important steps toward getting our fiscal house in order.  

“Is this measure perfect?  Absolutely not.  I supported deeper immediate spending cuts and stricter spending controls.  And I wish we could have found a Constitutionally appropriate way to advance the cause of a Balanced Budget Amendment.

“Should we have held out for more?  It was tempting, but my final judgment was that the Budget Control Act was as good a deal as we we’re going to get out of a President who stubbornly insisted on job-killing tax increases and deep and dangerous cuts to our national security budget. 

“We are slowly, but steadily, changing the debate in Washington toward spending discipline with real controls and accountability.  For example, from now on, every debt ceiling request from every President will be accompanied by dollar for dollar spending cuts aimed at reducing our dangerous debt. 

“Of course, our debt situation will take time to reverse, but the Budget Control Act is the significant move - of many to come - to turn our debt crisis around, build consumer confidence and focus on jobs!

“While changing the culture of spending in Washington is vitally important, it’s now time to return our focus to getting people back to work.  I would note that it was one year ago this week that Treasury Secretary Timothy Geithner crowed in the opinion pages of the New York Times, “Welcome to the Recovery.”

The simple truth is economic growth has stalled, with a meager 1.3% increase in the second quarter of this year.   In addition, consider these facts:

·        In the past nine months, the economy has grown an average of less than 1.5%, putting us dangerously close to a recession, again.

·        Entrepreneurship is at a 17-year low. Since 2007 there has been a 23% drop in new business creation, to the lowest levels since 1994.

·        The length of unemployment is at a historic high, taking the average unemployed American 40 weeks -or 10 months – to find a job.

“These are not signs of an economic recovery; they’re the result of a failed economic policy that must be reversed.

“Enough is enough!”

                                                Rodney Frelinghuysen

Read Rodney’s statement on the Budget Control Act here

The Budget Control Act Outlined

The Budget Control Act accomplishes the goal we’ve been working for since day one: it will reduce spending more than we increase the federal debt limit; it imposes no new taxes on anyone; and it guarantees a House and Senate vote on a balanced budget amendment before the end of this year.

The amended Budget Control Act of 2011 is not the ultimate solution to our nation’s spending-driven debt crisis, but it’s a significant step toward fixing the broken political system in Washington and changing the debate from how much more we can spend to how we can stop spending money we don’t have.

1. Cuts More Than It Hikes: The House Leadership made it clear to the President that any debt limit increase must be accompanied by spending cuts that exceed the amount of the debt limit hike. No more blank checks for President Obama – any new debt increase will have to be met with even more cuts.

·        The Budget Control Act creates a Joint Committee of Congress that is required to report legislation by November 23, 2011 that would reduce the deficit by at least $1.2T over 10 years.

2. Rejects Calls for Job-Killing Tax Increases: Our debt crisis is a result of Washington spending too much, not taxing or borrowing too little. Raising taxes on job creators will cause even more harm -controlling spending must be the solution.

•      The Budget Control Act includes no tax hikes, and ensures that if tax hikes are a part of any negotiations for a future debt limit increase, the House can easily vote it down.

3. Changes Washington’s Spending Culture: In just seven months, we are already changing the trajectory of federal spending and actually shrinking a federal government that has done nothing but expand for the past 40 years. We passed Cut, Cap and Balance. We have led the fight for controlling spending and saving our children and grandchildren from national bankruptcy and this bill will ensure that a Balanced Budget Amendment is sent to the states.

•      For the first time in the history of modern federal budgeting, the House will cut discretionary federal spending for two straight years. .

4. Avoids a Default on Current Obligations: Most Americans believe that people – and Congress – should pay their bills. If the debt ceiling was not raised, at some point, obligations of the federal government will go unpaid. Failure to meet these obligations will cause even more economic harm that the Obama administration has already done. Further uncertainty could lead to an increase in interest rates, which would hurt small businesses and  families by increasing the rates on small business loans, credit cards, mortgage rates, car loans, and student loans.

•      The Budget Control Act would cut and cap discretionary spending immediately, cutting $22 billion in spending next year, and saving $917 billion over ten years, and raise the debt ceiling by less – up to $900 billion – in order to avoid default.

5. Advances the cause of a Balanced Budget Amendment: Fifteen years ago, the BBA passed the House with bipartisan support, only to lose by one vote in the Senate. Since then, the debt has grown by $9.2 trillion. The BBA is a game-changer -the ultimate solution to our nation’s fiscal crisis. This bill ensures that both the House and the Senate will vote on the Balanced Budget Amendment before the end of the year.

•       Same as House-passed bill, the new framework requires both House & Senate to vote on a BBA after Oct. 1, 2011 but before the end of year. The president will be authorized to request a second debt limit increase of $1.5T if the Joint Committee cuts spending by a greater amount than the requested debt limit hike, OR if a Balanced Budget Amendment is sent to the states, creating incentives for previous opponents of a BBA to now support it.

Signs of the Times: Consumer Spending Down, Manufacturing Growth Slows

There is evidence everywhere that America desperately needs a “pro-growth” agenda that promotes economic expansion and private-sector job creation.  In addition to this morning’s jobs report, information released this week on consumer spending and manufacturing appear to be pointing in the wrong direction.

Consumer spending unexpectedly fell in June to post the first decline in nearly two years as incomes barely rose, a government report showed, suggesting economic growth could remain subdued in the third quarter.

Read the Reuters report here

Manufacturers had their weakest growth in two years in July, a sign that the economy could weaken this summer.  A key manufacturing industry group said this week that its index of manufacturing activity fell to 50.9 percent in July from 55.3 percent in June. The reading was the lowest since July 2009 -- one month after the recession officially ended. ... The disappointing report on manufacturing suggests the dismal economic growth in the first half of the year could extend into the July-September quarter. 

Read more in this report from Associated Press here

From the “We’ve Heard This Before” File:  Trade Pacts to Advance

Senate leaders said this week they had reached a bipartisan agreement to renew funding for trade-related unemployment benefits, clearing the way for passage of three delayed free-trade pacts with Colombia, Panama and South Korea.

Despite the fact that these trade pacts would create tens of thousands of American jobs by helping U.S. companies export their products and services, these agreements have not been submitted to Congress by the President for implementation!

Earlier this year, the World Economic Forum issued its annual “Global Enabling Trade” report which describes how the United States ranks 121st out of 125 economies in terms of “tariffs faced” by our exports overseas!  In other words, when American businesses try to export, their products face higher tariffs than nearly every other one of our international trade competitors.

Read Rodney: Obamacare Damages Medicare

Rodney strongly supports Medicare.  That’s why he’s so concerned that the implementation of Obamacare, including its $500 billion cuts, is already damaging this important program.

Read Rodney’s Op-Ed piece, published last Sunday in the Morris County Daily Record, here

Recommended Reading:  The Washington Post carried a story this week, As 1st female submariners train for duty, Navy prepares crews for dramatic culture change”.  As a member of the United States Naval Academy Board of Visitors, Rodney heard firsthand from several of these young women who sought to serve in our submarine fleet and were accepted by the nuclear Navy.  Read their story here

Noted With Interest: Death Toll Rises in Syria; Where are We???

Shortly after Syrian tanks killed dozens of civilians in the city of Hama, Italy announced it would recall its ambassador to Damascus to increase pressure on the regime of Bashar al-Assad.  Yet, the Obama Administration not only refuses to recall the U.S. ambassador but is, once again, seeking his confirmation by the Senate.  What is the Administration waiting for?