A lot of people (including us) have made a lot of hay over the past four years with the Senate’s failure to perform its most basic responsibility of passing a budget since April 2009, which was a full year before the first iPad was introduced.
But after looking at the Senate budget resolution passed early Saturday morning, we take it back—we were better off when the Senate didn’t pass budgets.
For one thing, the Senate budget includes almost a trillion dollars in new tax hikes, and that’s on top of the tax increases from last December’s fiscal cliff deal. According to Ezra Klein of the Washington Post, that’s $375 billion more than even President Obama has been demanding as part of a “grand bargain.” To the Left of Obama, in other words.
And, of course, the Senate doesn’t say where this new trillion dollars in taxes will come from. How convenient.
The Senate budget also claims $275 billion in new cuts to Medicare and Medicaid, which should raise the hackles of some traditional Democrat constituencies. But despite these cuts and a huge tax increase, the Senate budget never balances. Never.
Contrast this with the House budget, which balances in 10 years without any tax increases, and indeed simplifies the tax code. You can see that there is an almost insurmountable gulf between the budget visions of the House and Senate.
Now, a budget resolution is just that—a statement of intentions. But what intentions!
Beyond the trillion dollars in new tax hikes, the Senate budget resolution endorsed the empowerment of state level taxers to collect sales taxes on remote Internet sales, which is the essence of the proposed Marketplace Fairness Act.
IPI has written extensively (most recently here) on all of the problems with allowing states the power of taxation without representation. It’s a nightmare for small businesses, which would have to comply with the tax provisions of not just the states but of over 7,600 distinct tax authorities that levy a sales or use tax.
A trillion in new taxes from somewhere? Empowering states to audit and intimidate small businesses from other states? We take it back—we were better off when the Senate didn’t pass budgets.
March 27, 2013