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Republicans have long claimed to be deficit hardliners, blaming Democrats for the growing deficit and debt. But the two votes they cast after electing Kevin McCarthy as Speaker of the House prove that Republicans are crooks when it comes to reducing the deficit.
First, House Republicans passed a new rule called CUTGO. This could seriously damage the fiscal health of the country by adding trillions of dollars of deficits to public debt.
And just hours after passing CUTGO, they closed the deficit again by voting to cut the Internal Revenue Service’s budget. This vote will increase her debt by more than $100 billion over a decade by encouraging wealthy Americans to cheat their taxes and avoid paying their fair share.
How does CUTGO increase debt? This allows Congress to pass huge tax cuts without paying a penny. All costs are added to the liability. The Democratic-controlled House had a rule called PAYGO. This calls for offsets or trade-offs for all spending increases or tax cuts so that these changes do not add to the deficit.
The Republican CUTGO alternative would change that long-standing rule so that it doesn’t apply to taxes, only to spending. CUTGO is designed to advance the established priorities of the Republican Party. That means cutting spending on priorities like climate change and health care, while passing huge tax cuts to balloon the debt and benefit the rich.
CUTGO also makes it more difficult to raise taxes on the wealthiest Americans and businesses that pay little or no taxes, as the House needs a supermajority to pass revenue increases. No one likes higher taxes, but with $31 trillion in debt, it should be in your toolbox for reducing the deficit.
Republicans have defended CUTGO, saying the rule makes it harder for Congress to increase spending. They are right that limiting new spending is a key factor in controlling the deficit, unless it is offset. But spending is only half the equation. Anyone who has ever tried to balance a household knows that reducing income, or in the case of government, reducing revenues, is a recipe for bankruptcy.
The last time the House imposed CUTGO was under President Donald Trump, when Republicans passed costly $2 trillion tax cuts, all of which added to the nation’s debt. Thanks in part to those tax cuts, the deficit increased by almost 50% between 2016 and his 2019. This was long before COVID-19 hit our country and required trillions of dollars in additional spending.
The Trump administration’s disappointing record of ballooning debt is nothing new to Republicans. President Ronald Reagan passed huge tax cuts and increased defense spending, widening the deficit, and President George W. Bush swelled the deficit by adding trillions of dollars over a decade.
Deficits and debt are serious and growing national problems. And the time for Congress to address this issue is long past. But exchanging PAYGO for her CUTGO is a big step in the wrong direction. So is cheating the richest people with their taxes.
The House needs to properly fund the IRS. And, as they did in the 1990s, the PAYGO rules must be preserved and strictly enforced. House Republicans talk a good game about reducing debt. Their vote to create more debt shows that House Republicans are not ready to rule.
Thomas Kahn, who served as Democratic Staff Director on the House Budget Committee from 1997 to 2016, is a Fellow of the Center for Congressional Studies and President of American University.
los angeles times
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