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Addiction to Spending is a Bipartisan Issue

Over at NRO this week, Cato scholar Michael Tanner takes issue with Republicans who, when it comes to spending, seem to be willing to talk, but not walk.

Citing NRCC Chair Greg Walden’s reaction to President Obama’s budget a few weeks ago, in which he lambasted the President over cuts to Social Security instead of the budget’s trillions in new spending, debt, and taxes, Tanner wonders if Republicans are actually serious about this spending thing.

Tanner goes on to list many more examples of Republican meekness involving defense, farm subsidies, NASA funding, and more, coming to the same conclusion that we painfully reach seemingly each and every time:

Members, regardless of party, consistently abandon principle when their own interests are challenged.

If you’ll remember, Ending Spending confronted a huge part of this problem in 2011 by successfully lobbying for an earmark moratorium by House Republicans. It is, to this date, one of our proudest achievements.

Lest we run a victory lap, Tanner’s post reminds us that the work is far from over, even among those who are seemingly friendliest to our cause of solving our nation’s spending crisis.

http://nationalreview.com/article/347041/how-serious-are-republicans/page/0/1

Top Ten Tax Hikes in the Obama Budget

Crossed posted from American for Tax Reform: bit.ly/16N7LvF

WASHINGTON, D.C. — There are literally dozens of new tax increases in the FY 2014 Obama budget. In total, they increase taxes by nearly $1 trillion over the next decade. They would permanently bring the federal tax burden to 20 percent of economic output, a level only reached in one year since World War II (FY 2000, when the economy was roaring and tax revenues were pouring into Washington as a result).

Below are the top ten tax increases in President Obama’s budget (all numbers are over a decade):

1. Chained CPI. The budget would change the definition of inflation for all federal budget purposes, including federal tax provisions. Because tax brackets and other tax items are indexed to inflation, slowing down their growth is an income tax increase. This is a tax increase for all Americans who pay income tax, including middle class Americans. In the past, Congress’ Joint Committee on Taxation has estimated that enacted “chained CPI” would be a $100 billion tax increase.

2. Itemized deduction cap. The Obama budget limits the maximum value of itemized deductions, like those for charitable donations and mortgage interest. This is an income tax increase. No matter what tax bracket you are in, under this Obama provision you can’t benefit any more than if you were in the 28 percent bracket. There are three tax brackets higher than this: 33 percent, 35 percent, and 39.6 percent. These families will not be able to fully deduct things like mortgage interest, charitable deductions, and state taxes paid. Note that this is on top of the phaseout of itemized deductions (“Pease”) that President Obama forced on taxpayers in the fiscal cliff. Tax increase: $529 billion

3. Death tax hike. The Obama budget would raise the death tax rate from 40 percent today to 45 percent. It would also reduce the inflation-indexed death tax “standard deduction” from $10.3 million today for married couples (half that for singles) to $3.5 million with no inflation adjustment. There are also other death tax increases of a more technical nature. Tax increase: $79 billion

4. “Buffett rule.” The President’s budget would impose a new “Buffett rule” on taxpayers whose adjusted gross income exceeds $1 million. These taxpayers would have to face an average tax rate (that is, their tax bill divided by their income less charitable contributions) of 30 percent. Tax increase: $53 billion

5. Tobacco tax hike. The President’s budget nearly doubles the tobacco tax, from $1.01 to $1.95 per pack, and then indexes it to inflation from there. This is a clear tax hike on middle class Americans. According to independent estimates, the average smoker in America makes about . Additionally, tobacco taxes are a declining tax revenue base, and as a result it’s inappropriate to fund new government programs using it. This isn’t the first time President Obama has raised federal tobacco taxes. In 2009, on his sixteenth day in office, he signed into law a 156 percent increase in the tobacco tax. Such tax increases are a violation of Obama’s central campaign promise not to sign “any form of tax increase” on Americans making less than $250,000 per year. Tax increase: $78 billion

6. IRA and 401(k) plan restrictions. There are two new tax increases on IRA and 401(k) savers in the President’s budget. The first restricts the total account balance in ALL tax preferred IRAs and 401(k)s to a combined $3 million. The second would require that non-spouse beneficiaries of IRAs and 401(k)s distribute all money within five years, rather than over their lifetime. Additionally, the budget forces all employers with 10 or more employees to open payroll-deduction IRAs at work. Tax increase: $14 billion

7. “Carried interest” capital gains tax hike. Under current law, capital gains are taxed at rates lower than ordinary income to reflect the double taxation of investment capital, risk, and other factors. The current top capital gains tax rate is about 24 percent. Some capital gains are received by managing partners of investment partnerships. These capital gains are known as “carried interest.” Despite the fact that these capital gains are no different than capital gains anywhere else (and are the same source of capital gains that the limited partners in such arrangements receive), the President’s budget taxes these capital gains at ordinary income tax rates, which are nearly 45 percent on an all-in basis. Tax increase: $16 billion

8. Energy tax hikes. There are energy tax hikes littered throughout the budget. Taken together, these tax increases will have one effect and one effect only: higher prices for consumers at the gas pump and in their utility bills. Tax increase: $94 billion

9. Tax increases on international income. The U.S. is one of the only developed nations that taxes the income of U.S. companies and individuals which are earned overseas (so-called “worldwide taxation”). In so doing, we potentially expose this money to taxation in two different countries on the same earnings. The Obama budget increases the likelihood that this double taxation will occur by removing protections against it. Ideally, the U.S. would only seek to tax income earned within the United States, a system known as “territoriality.” Tax increase: $158 billion

10. Financial system tax increases. These, too, are littered throughout the budget. They would impose taxes on banks, brokerage firms, life insurance companies, and virtually every other way that the middle class saves and invests. These costs will be passed along in the form of higher fees, bigger commissions, and lower returns to shareholders. Tax increase: $94 billion

A Banner Week for Government Spending

Unquestionably, this week was a banner week for the discussion of government spending. Between the funding of duck genitalia studies, millions in excessive catfish inspections, and an Obama budget which adds a trillion in new taxes with pennies on the dollar in spending cuts, it’s also been a provocative one. To wit:

- CNSNews.com this week launched Waste Watch, a section of the popular news site dedicated to newly reported instances of ridiculous spending by the federal government, including at launch $400,000 to study duck genitalia, $700,000 for gardening at the U.S. NATO Ambassador’s residence in Belgium, and $2.1 million last year to literally study what animals are thinking. Given our heritage in the earmark battle, we welcome this new window for the public into the ridiculous things we spend our money on.

- President Obama revealed his long-awaited budget on Wednesday, proposing the addition of $8.2 trillion in new debt, $1.1 trillion in new taxes, and only $119 billion in “deficit reduction,” according to the House Budget Committee. With these jokes for numbers, we are clearly not fans.

-And, finally, the U.S. Government Accountability Office released its duplication report on tens of billions of dollars in taxpayer money that could be potentially saved through the elimination of duplicate programs. This comes after the efforts of taxpayer heroes like Senator Tom Coburn who has been leading the charge against government waste for his entire career.

This budget battle will not be short and we’ll be providing updates and commentary along the way. In the interim, feel secure in the knowledge that our government is spending your hard earned cash on figuring out what’s on your Golden Retriever’s mind.

Broad Coalition Urges Congress to Create Committee to Reduce Government Waste

This week, Ending Spending was proud to join with Americans for Tax Reform and forty-one other taxpayer-friendly organizations in urging Congress to create a Committee to Reduce Government Waste.

In a Congress whose committees generally focus on growing government, it just seems natural that one should focus on shrinking it. A body authorized only to cut spending, such a committee would mimic the mid-20th century effort that was successful in rolling back many parts of the New Deal. Just as the continuation of New Deal programs threatened to overwhelm our economy back then with unsustainable debt, our current climate of out-of-control spending and government expansion demands a similar solution.

You can read the full letter sent to the House and Senate Republicans leading the charge on this effort by visiting this link.

The Ins and Outs of The Federal Budget

The Wall Street Journal this week posted a great visualization of the makeup of the federal budget since 1965. Its conclusions are no surprise, but it’s important to be reminded from time to time of the seismic shifts that are defining the spending battle in the years to come:

- Since 1965, so-called “mandatory spending” ** (Medicare, Medicaid, and Social Security) has risen from 6.14% of GDP to just under 20% in 2013, becoming along the way the single largest component of federal outlays.

- “Discretionary spending” has changed, too — while defense spending has traditionally dominated the category, domestic spending like cost related to implementing Obamacare has recently taken over.

You can see the Journal’s charts by visiting this link.

* Here at Ending Spending, we don’t like the terms “mandatory spending” and “discretionary spending”. No spending is truly mandatory – just another choice made along the way by our government.

Millennials fight for future with own war on debt

Under President Obama, the national debt has increased by $6 trillion. By the time young people – known in many discussions as “millennials” – reach retirement are, the debt will be nearly 250% of our country’s GDP.

In a special opinion piece in Politico, Representative Cathy McMorris Rodgers, Jaime Herrera Beutler, Adam Kinzinger, and Aaron Schock share their thoughts on why the path we’re on is “unacceptable and unsustainable”.

Millennials Fight For Future With Own War on Debt
By Rep. Cathy McMorris Rodgers, Rep. Jaime Herrera Beutler, Rep. Adam Kinzinger, and Rep. Aaron Schock
Politico

Last week, in one of the liveliest and most thought-provoking conversations we’ve had in this Capitol, we sat around the table with a group of young people who care deeply about solving our nation’s debt crisis. These “millennials” — representing myriad socioeconomic backgrounds, ethnicities, college campuses and political persuasions — all want the same things: a solution to our national debt. A reduction in the out-of-control spending they’ll be forced to pay back one day. And an acknowledgment that if Congress keeps kicking the can down the road, then they will kick right back.

And that is exactly what they have done. They came to Capitol Hill with suggestions, solutions and an eagerness to get involved in an issue that disproportionately affects their generation. Representing several organizations — The Can Kicks Back/Fix the Debt, National Campus Leadership Council, Common Sense Action, Concerned Youth of America, and Public Notice/Bankrupting America — they addressed the impact of the national debt on their generation and how Washington’s spending problem today will hurt America’s youth tomorrow.

We heard from one woman who recently graduated from college — eager and excited about the opportunities before her — only to be told that she should expect no less than five years of unemployment. A young man with a 2-year-old daughter told us that he is already afraid he won’t be able to put her through college. And a University of Maryland sophomore said she can’t afford to go to graduate school for fear of being saddled with even more debt than she is right now.

Unfortunately, their challenges are not unique and their experiences are not uncommon. These young people are the next generation of American leaders — they’re college students, campus leaders, budding entrepreneurs, future economists, innovators, scientists, nurses, business leaders and doctors. But a major obstacle stands in their way: the national debt. It’s more than just a $16 trillion price tag. It’s more than just a number that continues to rise under President Barack Obama. It’s a threat to the future of our children and grandchildren. In fact, when asked recently to identify the greatest threat to our national security, Adm. Mike Mullen, then chairman of the Joint Chiefs of Staff, cited our national debt.

Read the entire article here.

Ending Spending Urges House Leadership to Maintain Level of Automatic Spending Cuts


03.06.13 UPDATE: House Passes Bill To Fund Government
For Six Months, Maintains Automatic Spending Cuts



March 5, 2013



Dear Speaker Boehner and Leader Cantor:

On behalf of Ending Spending, I write to you in support of H.R. 933, the Continuing Resolution for the remainder of FY 2013. Of great importance in the fight against out-of-control deficit spending, H.R. 933 locks in place the automatic spending cuts implemented through President Obama’s sequester.

As you know, our organization has strongly supported your efforts to defend the level of sequester cuts. As voters and the media have watched the Obama administration’s sequester rhetoric go from alarmist to patently false, it has become clear to the American people that cutting $85 billion out of a $3.6 trillion budget is not going to be the catastrophe that the administration claimed. Indeed, the sequester equates to a real reduction of only $44 billion in actual spending outlays this year, mere pennies on every dollar spent.

We believe that elected officials have a moral responsibility not to saddle future generations with a massive debt burden. The spending reductions achieved through sequester, and further implemented through the proposed FY 2013 CR, are a necessary first step towards controlling the deficits that threaten our economic future. Moreover, as Chairman Rogers has stated, the proposed CR “funds essential federal programs and services, helps maintain our national security, and takes a potential shutdown off the table.” For those reasons, we urge that the House pass H.R. 933.

We look forward to continuing to support your efforts as you work to advance fiscally responsible polices in Washington.

Sincerely yours,
Brian C. Baker
President

cc: Members of the U.S. House Republican Conference

The Elephant In The Room: Federal Spending

For all the talk of “revenues” and new taxes proposed by those on the left, it’s hard to have a discussion about our nation’s fiscal health without tackling the gigantic elephant in the room: the sheer enormity of federal spending.

Fighting back in that messaging war with elegant simplicity is again Rep. Paul Ryan, who summarized his argument in one simple chart during his appearance yesterday on Meet the Press. Watch the video, share it with your friends, and be sure to retweet with the hashtag #SpendingIsTheProblem

Fighting for a Permanent Earmark Ban

While Ending Spending’s work two years ago led to the current temporary ban on Congressional earmarks, the ban is still voluntary. Should Members of Congress one day be tempted to go back on the public dole, nothing in current law would stop them.

That’s why we’re extremely excited to see Claire McCaskill join Pat Toomey, both longtime taxpayer heroes and opponents of earmarks, to reintroduce the bipartisan Earmark Elimination Act, a much-needed piece of legislation that would permanently make pork-barrel spending a thing of the past.

Ending Spending is proud to stand with Senators McCaskill and Toomey on this important piece of legislation. We’ll keep you updated on its progress.

Ending Spending Backs Cuccinelli for Va. Governor, Snyder for Va. Lt. Governor

Ending Spending – a nonpartisan advocacy group dedicated to reducing excessive government spending and waste, and restoring responsible spending practices in government – today endorsed fiscal conservatives Attorney General Ken Cuccinelli for governor and entrepreneur Pete Snyder for lieutenant governor in Virginia’s 2013 gubernatorial race.

“As the eyes of the nation turn to key gubernatorial races, the issue of economic responsibility will be a yardstick for how voters will measure up candidates, and Virginia will play a critical role in the ongoing national discussion of how we solve the problem of growing state and federal debts,” said Brian Baker, president of Ending Spending. “Ken Cuccinelli and Pete Snyder recognize that our country cannot get on the path to prosperity with bigger government and more spending and debt.”

Baker added, “We were proud to work with Attorney General Cuccinelli on the legal fight against Obamacare, which contains over a trillion dollars in new spending over the next ten years. And Pete Snyder is a highly successful innovator and job creator who knows that the only way to stop saddling future generations with crushing debt is to create long-lasting economic growth. Their demonstrated records as conservative leaders make them a great team to lead Virginia.”

Taxpayers Connected:

Our national debt is  
$ 00 00 , 000 000 , 000 000 , 000 000 , 000 000
and each American Taxpayer owes $119,236 of it.