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Thursday, August 10, 2006
Paul  Weyrich :: Townhall.com Columnist
A Fiscally Irresponsible 109th Congress-Future Prospects
by Paul Weyrich
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Congress is in recess until after Labor Day. It will reconvene only for about four weeks as members will want to adjourn around the first week in October so they will have a month before the elections.

I had such high hope for the 109th Congress. A Republican President had been re-elected with an outright majority of the popular vote. Republicans increased their margins by four in each body of the Congress. Yet unless there are some spectacular moves in that final month the 109th Congress will go down in history as one of the least productive. That is no fault of the House. The House has repeatedly passed the right kind of legislation only to see it die in the Senate. Just before the Senate went out, Majority Leader William H. Frist, M.D. (R-TN), took up the House-passed bill which would raise the minimum wage while at the same time eliminate much of the death tax. There were sufficient votes to pass the measure but Senator Bill Frist was three votes short of breaking the Democratic filibuster. That has been the problem with virtually all important legislation. The House will pass a sound piece of legislation and then it will die in the Senate, even though there are enough to pass it, but not 60 votes to break a filibuster.

Regardless of what happens in the final month of the 109th Congress it will be disappointing. Oh, they might be able to resolve ANWR and offshore drilling (although that may take a post-election session) but regardless of what happens before the election, the 109th Congress will be a disappointment because it utterly has failed to do anything about entitlements.

The President tried to get a reform of Social Security. The Democrats told him not just no, but Hell no. Other entitlements, such as Medicare, have not even been tackled, even though Medicare is closer to bankruptcy than is Social Security. David Walker, the Comptroller General of the United States, in an interview with Newsmax.com reporter Dave Eberhart, warned that unless Congress takes radical steps to curb federal spending America will be facing a disaster of unthinkable proportions. Walker estimated the true cost of the prescription-drug program passed by the last Congress is $8 trillion, not the $300 billion which Congress estimated. Walker told Eberhart that the prescription drug plan "is a poster case for what is wrong with Washington."

Walker is a CPA. He began his 15-year term in November 1998. He has won plaudits from both Republicans and Democrats for his straight talk. For example, Walker said that the Department of Defense budget is out of control and the basic rules of accountability don't apply. Walker said that Defense is the only agency which cannot account for its assets and expenditures.

Walker told NewsMax.com that the United States risks losing its pre-eminence around the globe because of its growing status as a debtor nation. He pointed out that last year was the first year since 1933 that Americans spent more money than they took home--and, of course, 1933 was well into the Depression.

Then Walker told NewsMax.com that unless entitlements are drastically reformed the United States would face serious economic woes. When the baby boomers begin to retire the situation would be out of control unless the system was drastically reformed.

Walker is absolutely correct. That is why the 109th Congress will end up a disappointment. Politically we should have been able to tackle a reform of entitlements with a Republican President and both Houses of Congress strongly in the hands of the Republicans. Granted Senator Harry Reid (D-NV) and his band of yellow-bog Democrats would block any kind of real reform. To that Walker says "the status quo is not an option." Quite so, but how and when are these reforms to be enacted? Some Democrats argued that we need not do anything until 2040, when the Social Security fund goes into serious negative territory. That is false. Social Security begins to reach trouble in 2012, a mere six years from now. Medicare is worse. No one knows for certain the real cost of Medicare, but it is certain that costs are escalating and there is no plan to bring Medicare spending under control.

Walker argues that unless we had double-digit growth for the next 75 years we would not be able to grow our way out of the problem. Walker as head of the GAO (General Accountability Office) has a budget approaching half a million dollars. He minces no words when he tells Congress "we must make tough choices and the sooner the better." Walker wants to revise existing budget processes and financial reporting requirements, restructure entitlement programs, re-examine the base of discretionary and other spending, and review and revise tax policy and enforcement programs, including enforcement. Walker told Eberhart "everything must be on the table." When will this happen? Surely the most optimistic view of the 2006 elections does not see Republican gaining seats in both Houses. If the Democrats win control of both Houses, as I predict they will, they surely would not tackle these issues. As old as I am, I may not see the crash that can come if reforms are not enacted. But I have five children and 12, going on 13, grandchildren about whom I care deeply.

We are so irresponsible in putting the burden for all of this on future generations. My advice to both my children and grandchildren is to plan for their own retirement. The Federal Government simply will not be in a position to help by the time they are ready to retire. I just want to know which Congress ever will tackle entitlement reform. Maybe Hillary has to get elected, and like President Richard Nixon and China, Hillary will be the President who goads Congress into entitlement reform.

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About The Author

Paul M. Weyrich is the late Chairman and CEO of the Free Congress Research and Education Foundation.
 
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HILLARY FOR PRESIDENT!!
The ticket here is to have a president of one party and a congress of the other.

They'll be so busy fighting each other, they won't have time to pass any more bad bills.

Ok, people, sing it with me:

"GRID lock GRID lock GRID LOCK GO!
THAT'S the ONly WAY TO GO!!"

"Two Four Six Eight, What do we Appreciate?
GRIDlock, GRIDlock GRIDLOCK!!"

"Huzzah!"

Tax cuts?
JohnL writes:
we get the extension of tax cuts, which only increases the deficit
---------------------------

That was my only real disagreement and even there, I have some agreement.

But first, no bills are better than bad bills and that is about all we have got.

Regarding tax cuts, yes and no. They have increased tax revenues but, we could have done a lot better with the type Ireland used to reduce national debt from 120% to 27% at the same time workers wages went up 325% although their tax cuts were more for wealthy, business and investment which spurred so much growth they went from welfare nation to 2nd wealthiest per capita in Europe.

Here are a couple of sites on how Ireland did what we aren't doing.
http://www.ncpa.org/~ncpa/pi/internat/pd062601c.html

http://www.heritage.org/Research/WorldwideFreedom/bg1945.cfm

The tax cuts we did encouraged spending but on what? American goods or more imports from China.

Ireland went at it another way be lowering taxes on business and investment they encouraged competition and lower prices and higher wages all of which meant more money spend in Ireland on Irish goods (plus imports of course)

In a recent job growth report they said we gained 175,000 jobs. In that same report was the loss of another 48,000 manufacturing jobs and 10,000 high tech jobs and the growth was from dishwashers, bus boys, car wash employees, sweepers, and construction too, but a lot of service industry jobs that don't pay much. We used the only tax cuts liberals would let us have (remember the filibuster is still alive and used often) but, it didn't help. Much of the job growth was tied to the housing boom (42%) that low interest rates had more to do with than the tax cuts.

Think of this too. 1/2 of the workers don't pay income tax because of tax exemptions, and tax cuts and other things "to help low income workers." Thus, raising a worker's pay making $24,000 to even $30,000 doesn't make him pay income tax. But, increase the profit of the business $6,000 and the government does get more taxes. So, bring in a few million low wage workers, keep wages down, profits rise and tax revenues rise.

quote:
By EDMUND L. ANDREWS
Published: July 9, 2006

WASHINGTON, July 8 — An unexpectedly steep rise in tax revenues from corporations and the wealthy is driving down the projected budget deficit this year, even though spending has climbed sharply because of the war in Iraq and the cost of hurricane relief.

snip-----------
The main reason is a big spike in corporate tax receipts, which have nearly tripled since 2003, as well as what appears to be a big rise in individual taxes on stock market profits and executive bonuses.
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2378082
======================
We can't even get tax cuts right. Just think what reducing our debt like Ireland would mean to prices. We pay $440 billion in interest on our debt and its going up. That means about $1,300 per person or $5,200 for a family of four in either direct taxes or taxes hidden in prices to pay for the national debt each year.

Neither party is playing straight with us on this issue. The Republcans are better but nowhere near the Irish in getting serious about debt.
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