Report From Congress: July 23, 2007

Op-Ed

REPORT FROM CONGRESS: July 23, 2007

By Congressman Roger F. Wicker

WICKER TOUTS LOWER DEFICIT, STRONG U.S. ECONOMY

The Office of Management and Budget (OMB) reported that the federal budget deficit for this fiscal year will be $40 billion less than earlier predictions, producing the smallest deficit since 2002.

This good news from OMB's mid-year budget review is the result of what the Associated Press called "impressive revenue growth from the healthy economy." That growth was spurred by the tax relief measures passed by Republicans in Congress and signed into law by President Bush.

FIVE YEARS OF GROWTH

Taxpayers have been able to help stimulate the U.S. economy by keeping more of their own money instead of sending those hard-earned dollars to Washington. This economic boost has produced five years of uninterrupted growth, with 8.2 million new jobs created since August 2003. The Labor Department reported 123,000 new jobs in June. Unemployment remains a low 4.5 percent. More positive news came from the stock market on July 17 when the Dow Jones Industrial Average surpassed the 14,000 mark for the first time in history.

One New York economist said, "The deficit has been improving faster than almost anybody had anticipated, and it's entirely because revenue growth has far exceeded even the most optimistic expectations."

GROWING REVENUES ERASING DEFICIT

President Bush credited the 2001 and 2003 tax relief provisions as the engine for the expanding economy, which has led to increased tax collections. "These growing tax revenues, combined with spending restraint, are driving down the federal deficit," he said. Income tax revenues have climbed 11 percent this year, and corporate tax receipts have increased by 15 percent.

The encouraging deficit news will also keep the government on track to reach a balanced budget by 2012. But that goal cannot be realized unless we continue to hold the line on spending, reject attempts to raise taxes, and work together to reform our entitlement programs.

The upward surge of our economy would be put in jeopardy if billions of dollars in new taxes are enacted by the Democratic majority in Congress. House Democrats adopted a budget plan for 2007 that included the largest tax hike in American history. The new majority is proposing an additional $23 billion to be spent on domestic programs next year, and they are ignoring the looming fiscal crisis facing Social Security, Medicare, and Medicaid. Instead, on the same day this positive deficit news was announced, Democrats in the House pushed through a bill creating nine new education entitlement programs where spending will not be subject to annual review through the appropriations process.

REJECT ‘TAX AND SPEND' POLICIES

The lower deficit figures and the continuing strength of our economy provide solid evidence that the tax relief measures in place today are working. Now is not the time to abandon that winning formula in favor of a return to the "tax and spend" policies of the past. Such action would threaten the economic gains we have made and take more tax dollars out of the pockets of the American people.

Source