By Rep. Steve Austria
Last Thursday, the House approved an agreement reached between President Obama and Congressional Republican leadership to extend the Bush-era tax cuts. The tax package ensures that those tax rates will not increase on January 1, 2011 and is extended for two years. It also includes a cut in the pay roll tax, establishes an estate tax rate of 35 percent and provides for a 13 month extension of unemployment benefits.
Many in Congress, like myself, would have preferred a permanent extension bringing more certainty to the financial and business markets but this may be the best opportunity we had to ensure that there would not be a tax increase. If we hadn’t taken action before the end of the year we would have seen significant tax hikes on small businesses and hard-working families.
This bill will help bring some certainty to the markets, which is needed now to grow the economy and create new jobs. When Speaker Boehner and House Republicans take over in January, our immediate focus will be to eliminate wasteful Washington spending and reduce the debt.
Appropriations
This year, Congress failed to enact any of the 12 appropriations measures or pass a budget to set spending levels. Instead, Congress has relied on short-term funding bills to keep the government running as they debated whether to punt the issue to the next Congress or consider a comprehensive appropriations measure, or omnibus. Late last week, Senate Democrats attempted to push a massive, $1.1 trillion omnibus spending bill that included additional funding for a controversial health care bill and funding for more than 6,000 earmarks. The bill was pulled from consideration due to strong opposition to its cost.
Last night, the House agreed to a continuing resolution measure to keep the government operating until March of next year.
Blogger Note: As U.S. Representative Austria mentioned above, a Pelosi-Reid led Congress hasn’t passed a national budget since entering office. They seemed more interested in ramming their special interest projects like socialist health care policy and gay rights through the legislative process than mundane national interests like national budget. Socialist and humanist agendas cannot be funded by something as restrictive as a budget or a balanced budget.
More important for us “little stinky people,” whose odor liberals like Sen. Reed cannot stand, was their failure to make tax cuts permanent. The only reason this is important is the fact that all previous temporary tax cuts have failed to stimulate the economy as claimed. During economic downturns (not to mention great recessions), people hold on to the extra cash while waiting for the economy to rebound. Surely the snooty liberals like Pelosi and Reid known this. According to some economists, Americans only spend the extra cash gained from tax cuts when those cuts are permanent. Now that millions are out of work, out of their homes, and out of cash thanks in part to ACORN supporting Democrats, I suspect the economists may see a slight exception to the rule.