Taking a sustainable, equitable path forward on budget

For years, Republican budgets have under-invested in America’s future, while shifting more cost and uncertainty onto average Americans, in order to benefit people who are already well-off. The Republican 2012 budget marks the high point of this 30 year battle by undermining critical middle-class protections while giving more help to those who don’t need it.

The Republican budget would make draconian reductions to key government services, environmental programs and safety protections while ignoring America’s fraying infrastructure. Medicare inefficiencies and unfairness are locked in for 60 million Americans for the next half-century while everyone under 55 is subjected to healthcare cuts that make a mockery of Republican campaign charges during the last elections.

In the areas of military spending and skyrocketing tax expenditures, Republicans merely nibble around the edges. There is a bipartisan appetite to reduce military spending. The House of Representatives has shown this is possible with the bipartisan vote to eliminate the F-35 alternate engine. If Ron Paul and Barney Frank can find $100 billion in military savings, then a bipartisan budget can do better.

At the same time, there is bipartisan agreement that we must invest in our transportation system. The American Society of Civil Engineers has given America’s public infrastructure the grade of “D.” Transportation investments provide a foundation for future economic growth. By providing transportation options for families in a time of rising gas prices, improving the efficiency of our roads and rails, cleaning our air and water, and giving flexibility to our communities, we can save costs and improve productivity. The Republican budget, however, decreases funding for transportation investments by 31 percent.

A responsible budget would not retreat on health security for Americans, but instead would accelerate the reforms in our healthcare law. After all, these provisions – like Accountable Care Organizations, bundling of services, and preventing unnecessary hospital readmissions – used to be bipartisan proposals to save money. Abandoning health reforms for Medicare vouchers and Medicaid block grants will give us the worst of both, providing less care at higher costs for the children, families, and seniors who depend on these programs.

The fact that tax collections are at their lowest rate since President Truman indicates that we do have a revenue problem. At a time when costs must increase to deal with the aging Baby Boom generation and American infrastructure that is literally falling apart, Republicans are committed to making expiring tax cuts permanent and, shockingly, bigger still. Democrats, meanwhile, would make responsible investments in America. An example is the Senate version of the FAA reauthorization, which passed by an 8 to 1 margin, that adopts fee increases supported by the industry to provide much needed airport construction and modernization.

True tax reform should pay for what Americans need, in simpler and more equitable fashion. We have high statutory corporate tax rates, but we’ve seen notable headlines of late where corporations have been able to dramatically engineer their corporate tax liability, sometimes all the way down to zero. The facts show that the portion of federal revenues provided by corporate taxes has plummeted. At the same time, tax expenditures—both individual and corporate—are increasing faster than inflation. Provisions embedded in the tax code, like oil subsides that years ago ceased being relevant to anything but the bottom lines of various giant oil companies, continue to drain taxpayer money. 

The administration, the Senate Finance Committee, and the House Ways and Means Committee are starting down a path of examining tax expenditures and beginning tax reform. The Republican Budget would undercut this effort, locking in unfairness and inefficiency.

The budget battles we face this year will show whether Congress is serious about taking a sustainable, equitable path forward and will demonstrate what Americans can expect to get from their federal partner. The Republican budget offers a poor start.

Originally published in The Hill 4/6/11

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