Budget and Deficit

Here we go again. The Federal Reserve Bank has released a report to top lawmakers on the congressional banking committees encouraging Congress to get more involved in housing policy.

Americans for Tax Reform, joined by a strong coalition of groups representing millions of concerned citizens and taxpayers, urged Members of Congress to reject any effort to increase fees on the aviation industry.

The debate over the debt ceiling extension dominates the news cycle and political discussions.

With the extraordinary turbulence of the global markets, the Obama Administration’s emphasis on stimulating the U.S. economy and creating U.S. jobs, and the increasing recognition from congressional appropriators that a strong patent system is critical to an innovation-friendly government, it is more important than ever that Congress pass a permanent legislative solution to the damaging practice of taxing innovation by diverting user fees away from the U.S. Patent and Trademark Office (USPTO).

If any of the estimated $1.5 trillion in retained overseas earnings of American companies are returned home, they are taxed at the federal corporate tax rate of 35%, one of the highest in the world, besides taxes paid to the host countries. Repeating the highly successful 2005 tax repatriation allowing these funds to come home subject to a 5.25% rate would bring hundreds of billions in new capital into the America economy.

The most desirable method of financing the transition to personal retirement accounts is to modestly reduce the growth rate of federal spending. Raising taxes would harm the economy. And future benefit cuts are wholly unnecessary, not only because they would do nothing to bridge the short-term financing gap, but also because the eventual proceeds from large personal accounts would more than offset any savings gained from cuts in promised benefits.

It is important to grasp precisely what the proponents of the 1993 tax increase thought they were accomplishing, the logic behind their plan as well as what actually happened.

1998 was supposed to be the year when fiscal good times finally overflowed the U.S. Treasury and put money back into the pockets of ordinary Americans in the form of tax cuts. What happened?

 Recently released figures lead us to estimate that the federal budget surplus could be roughly $1 trillion higher than Congress expected when it drafted the bi-partisan budget deal at this time last year. We believe that at least half of this $1 trillion windfall (but preferably all of it) should be returned to taxpayers via a very large tax cut enacted immediately.

Two words: Tax cuts. Surpluses should not be used for new government spending, or for paying down the national debt. They should be used to help return the overall tax burden to a reasonable level.