It???s official. Free-spending Senate liberal Democrats led by Kent Conrad (N. D.) have released a budget, and it calls for massive tax increases.
According to The Hill, the proposal calls for ???a 3% surtax on income of more than $1 million a year,??? for starters. Congressional Quarterly reports that the Conrad plan would ???call for raising taxes by about $2 trillion over a decade while cutting spending by about $1.5 trillion.??? The plan also slashes defense programs and makes no real cuts in other spending.
Sen. Jeff Sessions (R.-Ala.) blasted it: ???The merits of this 50-50 split between savings and taxes is both a question of philosophy and economics. Philosophically, the American people do not want Washington to continue raising taxes to pay for its spending spree.??? Sessions knows elite politicians in Washington have an insatiable appetite for spending.
Experts believe that tax increases would hurt small business and slow economic growth. Curtis Dubay of The Heritage Foundation tells HUMAN EVENTS that this tax idea would ???slow down economic growth because you are raising taxes on job creators. Small businesses that employ other people get hit the hardest by this tax.??? Dubay points out that if you study Treasury Department data, the 8% of small businesses that pay the top two marginal tax rates earn 72% of all small-business income and pay 82% of all taxes paid by small businesses.
The Senate Budget Committee is scheduled to take up the Conrad proposal and others this week when it marks up the Senate version of a budget for fiscal year 2012. The House passed the budget drawn up by Rep. Paul Ryan (R.-Wis.) last month.
Pat Toomey???s Budget Proposal
Last week, Sen. Pat Toomey (R.-Pa.) rolled out his own plan that balances the budget in 10 years without increasing taxes. Co-sponsors include Republican Senators Jim DeMint (S.C.), David Vitter (La.), Tom Coburn (Okla.), Richard Burr (N.C.), James Risch (Idaho), Marco Rubio (Fla.), Ron Johnson (Wis.) and Mike Lee (Utah). The plan lowers spending to 18.5% of the gross domestic product (GDP) and reduces publicly held debt to 52% of the GDP by 2021.
The plan simplifies the tax code, reduces our nation???s high corporate tax rate to 25% and repeals ObamaCare. The plan mirrors Paul Ryan???s plan to block-grant Medicaid funds to the states. ???We set out a goal for this budget, and the goal was to demonstrate that it is in fact possible to balance the budget within 10 years without raising taxes,??? Toomey said.
Club for Growth President Chris Chocola argues that if the Toomey proposal is ???combined with the Lee-Walsh Balanced Budget Amendment, then it will be pro-growth senators like Pat Toomey who will put America on a path to prosperity yet again.???
The Heritage Foundation Budget
The Heritage Foundation rolled out a budget reform proposal last week, Saving the American Dream, that also achieves balance within 10 years. The plan reforms Social Security, Medicare and Medicaid. It also addresses ObamaCare, tax reform and discretionary spending programs in an effort to reduce the burden of debt on future generations.
???The plan substantially reduces the size and scope of the federal government, fundamentally increases the role of the states in choosing their own practices and brings decision-making closer to the people rather than to unelected administrators,??? Heritage Foundation President Ed Feulner said. Liberals have run up an enormous, unsustainable deficit by spending too much. The Heritage Foundation, Rep. Paul Ryan and Sen. Pat Toomey have proven that you can balance the budget without increasing taxes.
Speaker Boehner and a Debt-Limit Increase
House Speaker John Boehner (R.-Ohio) spoke to the Economic Club of New York last week and made a strong case for dollar-for-dollar cuts to spending in exchange for allowing the debt ceiling to be increased. He also took tax increases off the table as a means of balancing the budget.
???Without significant spending cuts and reforms to reduce our debt, there will be no debt-limit increase,??? Boehner said. He argued that the ???cuts should be greater than the accompanying increase in debt authority??? and that these cuts need to be in the ???trillions, not just billions.??? Boehner went on to say that ???with the exception of tax hikes???which will destroy jobs???everything is on the table.??? Tax increases would cause ???uncertainty for job creators???uncertainty that results in less risk-taking and fewer jobs.???