Last week the Congressional Budget Office (CBO) released its latest update on our country’s fiscal situation. According to the CBO, the federal deficit shrank $19 billion over the past 5 months. Additionally, CBO projects the deficit will be $90 billion less than 2006. Is this because of the Democrats policies? No.
Is this because the Democrats have cut spending? No.
This decrease is the continued result of President Bush’s tax cuts. In fact, if the Democrats have their way, they will increase federal spending – the spending bills passed by the House are $48 billion higher in non-emergency spending than the CBO baseline, which accounts for inflation related growth. Without any proactive legislation to continue the tax relief already provided for by Congress, taxpayers will see $150 billion in tax increases go into effect in 2011.
Republican tax policies do work. We can have lower taxes and higher federal revenue. Federal tax revenue grew by 14.5 percent in 2005 and 11.8 percent last year, receipts this year are expected to grow by about 7.1 percent.