Government Bytes


Reid Loses, Taxpayers Win, Senate Dems to Try Again

by Brandon Greife / /

“It’s very clear that private sector jobs have been doingfine,” Majority Leader Harry Reid said on the Senate floor earlier this week. “It’sthe public sector jobs where we’ve lost huge numbers, and that’s what thislegislation is all about.”

The legislation Sen. Reid was referring to was a $35 billionpiece of President Obama’s larger American Jobs Act. Obama’s larger plan – a mishmashof temporary tax relief, reheated spending ideas, and permanent tax hikes – wentdown in flames in the Democrat-held Senate. Rather than pull back and focus onareas of bipartisan agreement, Democrats decided to try and advance the planpiecemeal.

In a move that was clearly aimed at shoring up their base,the package included $35 billion in grants to create or retain various publicsector jobs such as teachers and police officers. The underlying premise of thebill, hinted at by Sen. Reid’s comments above, is that the recession iswreaking havoc on state budgets, forcing them to layoff public sector workers.

But as we found out in the last week, that’s simply not thecase. “Overall state spending continued to climb right through the recession,”writes John Merline for Investor’sBusiness Daily after examining reports by the National Association ofState Budget Officers’ annual reports. Indeed, he finds that state outlays in2010 were almost 10 percent higher than in 2008 and general fund spending isprojected to climb 5.2 percent in 2011. Total state outlays in 2010 were almost10 percent higher than in 2008.

In other words, this is less a plan about jobs than about politics.Or as NationalReview labeled it, “No Bureaucrat Left Behind.”

Unsurprisingly, the bill was defeated with bipartisanopposition last night, with three members of the Senate Democratic Caucus –Sens. Mark Pryor (D-AR), Joe Liberman (I-CT), and Ben Nelson (D-NE) – joinedwith Republicans to block debate on the package.

“I don’t think you increase taxes for new spending,” saidSen. Nelson in explaining why he voted against the ill-conceived bill. Senator Pryoradded, “I’m not sure federal taxpayers should be paying for teachers and firstresponders. That’s traditionally a state and local matter.”

NTU applauds those who voted down the bill. The bipartisanopposition should have been the latest signal to President Obama and SenateDemocrats to move away from the current tax-and-spend approach to jobslegislation.

Sadly, it doesn’t appear they got the message. Earlyreports indicate that Senate Democrats will announce a new bill today tocreate a national infrastructure bank combined with a 0.7 percent surtax onthose who earn more than $1 million. As NTU has arguedbefore, if immediate job creation is the priority, an infrastructure bank isthe wrong way to go. Between the time necessary to set up and staff an entirelynew bureaucracy and then receive and choose viable loan applications, we’retalking months, if not years, of lag time.

If the Senate is truly concerned about job creation, weencourage them to look at the numerous proposals that have been already beenpassed by the House. These include bills to eliminatethe burdensome regulations preventing businesses from expanding, increasedomesticenergyexploration,and to reducethe unsustainable spending and borrowing that has eroded economicconfidence.

No matter what Sen. Reid may say, the private sector is notdoing “just fine,” and Senate Democrats’ current tack will do nothing toimprove that.