Taxes & Spending

Congress Has Left Washington So Citizens Are Safe–For a While

No man’s life or liberty is safe when the legislature is in session. Never has that adage been truer than when Congress is hanging around Capitol Hill anxious to demonstrate its ability to pass laws, any laws, no matter how expensive, unnecessary and ill considered.

With Congress going home for its summer break, Americans are thankfully safe for at least a few days. But it won’t be long before members return to Washington, ready to tax, spend, regulate, and – they hope – re-elect.

So far the session has been a disaster. Congress approved an energy bill filled with billions in subsidies and special interest tax breaks (so much for making permanent the president’s tax rate cuts).

There’s money for almost every group with a letterhead and a lobbyist. Up to a billion dollars is likely to go to the Texas Energy Center, in Majority Leader Tom DeLay’s hometown of Sugar Land, for research on oil and gas drilling. Why should the petroleum industry be expected to pay for technologies that enable it to make money?

Even more awful is the $286.5 billion transportation bill.

It included $24 billion in purely pork barrel "special" projects.

There’s an incredible $1 billion for Alaska alone, a payoff to Rep. Don Young, R-Alaska, who chairs the House Transportation and Infrastructure Committee. Three million dollars of that will go for a documentary film "about infrastructure that demonstrates advancements in Alaska, the last frontier."

But pork respects no ideology or party. Sen. Ted Kennedy, D-Mass., took credit for $330 million in special highway projects. Even Rep. Mike Pence, R-Ind., head of the House Conservative Caucus and celebrated deficit hawk, proudly touted $16 million in projects that "will spur economic development and improve the quality of life for thousands of Hoosiers."

Alas, budget waste doesn’t stop at America’s borders. At the recent G8 economic summit, President George W. Bush promised to double foreign aid for Africa.

Never mind the fact that government-to-government assistance has failed miserably for five decades. In fact, many Africans are worse off today than a decade or two ago. Nevertheless, American taxpayers will have to kick more money into the proverbial rat hole.

It’s a miracle that the total burden of government as measured by the Americans for Tax Reform did not increase this year. According to ATR, Cost of Government Day fell on July 4, the same as 2004.

But that’s only because the economy grew more rapidly than expected. Had growth matched initial projections, COGD would have fallen on July 8.

The index, which includes expenditures and regulation, is being driven almost entirely by runaway spending, which accounted for 97 percent of the COGD’s advance over the last five years. Even if Congress had not passed the bloated energy and transportation bills before leaving town, the future would look bleak.

You have to go back to Lyndon Johnson’s presidency to find a time when domestic outlays were increasing more quickly. Warns ATR: "Without better fiscal restraint, particularly at the federal level, the COGD index has the potential to increase in future years."

But the prospect of fiscal restraint is a fantasy.

The hugely expensive Medicare drug benefit is set to kick in next year. Medicaid costs are racing ahead.

A demographic tsunami of an aging population is pushing Social Security toward the fiscal precipice. And Republicans are even worse than Democrats in packing legislation with worthless pork.

Moreover, ATR admits that its estimate of regulatory costs is conservative. The organization explains that it "ignores the negative economic effects of the costs of regulatory requirements," which could be as high as formal compliance costs.

Despite a Republican president, the number of pages of the Federal Register hit a new high last year. A joint study by the Mercatus Center and Washington University reports that the administration is proposing more staff and money for regulatory agencies next year.

Clyde Wayne Crews of the Competitive Enterprise Institute recently published the latest edition of his ever-depressing "Ten Thousand Commandments," a study on federal regulations. He figures that total regulatory costs ran $877 billion last year, more than total pretax corporate profits.

There are two groups of citizens in America. One pays taxes. The other spends the taxes collected.

There are two political parties in America. Both believe in spending every cent that can be raised, whether through taxes, fees, loans, or something else.

But for a few days, at least, the American people are safe.

Congress has gone home.


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