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Congress Wants to Buy Healthcare & Jobs
Posted By: Michael Tasselmyer - 11/05/13

Last week's release of the latest BillTally research offers taxpayers an in-depth look at the legislation that's been proposed on Capitol Hill so far this Congressional session, and the data doesn't offer much consolation for those who'd like to see less federal spending. NTUF found that the 86 unique, non-overlapping bills scored between both the House and the Senate would increase the budget by about $1.28 trillion per year: in other words, for every dollar Congress proposed to cut, they sought to spend an additional $3.83.

So where does the bulk of those new spending proposals come from? Largely in the form of legislation that would attempt to reform healthcare and stimulate job creation. The American economic recovery is still considered by most economists to be on relatively shaky ground, and many experts have warned of the detrimental impacts that rising healthcare costs could bring. Lawmakers in Washington have seemingly been paying attention to these signs and continue to introduce legislation designed to confront the issues.

NTUF Director of Research Demian Brady broke down the new spending proposals by issue area, and health- and economy-related legislation played a major factor in affecting the overall spending trends for the first six months of the 113th Congress.

In the House:

 Category  Number of Proposals  Total Annualized Cost (millions)  Average Annualized Cost (millions)
 Health  45 $1,184,328 $26,318 
 Commerce/Economy/Housing  40 $143,808 $3,595

And in the Senate:

Category Number of Proposals Total Annualized Cost (millions)   Average Annualized Cost (millions)
Health 35 $115,377 $3,296 
Commerce/Economy/Housing 14 $16,792 $1,199 

By far the largest health-related spending bill in the House was a plan to implement a single-payer system. That proposal would amount to $1.16 trillion in new spending. Other multi-billion dollar bills related to healthcare to emerge from that Chamber include:

  • $3 billion in research aid for the National Institutes of Health (H.R. 1301);
  • Repealing a cut to $1.6 billion worth of payments to certain hospitals under the Affordable Care Act (H.R. 1920); and
  • A bill to extend the Federal Employees Health Benefit Program to non-federal workers (H.R. 779), at a cost of $7.5 billion.

The massive cost of healthcare-related proposals is in line with previous years. There was no single-payer bill introduced in the Senate during the first six months of the year, but even without such legislation, health-related spending bills in the Senate were still over four times as costly as the next most expensive issue area (education, at $27.3 billion per year).

Economic stimulus bills were more common in the House (40 bills) than in the Senate (14 bills). Of course, the Senate also proposed much less spending across all policy areas: its total net agenda would reduce federal spending by $46.8 billion, and Senators proposed fewer $100 billion or larger spending bills than their colleagues in the House. And even without single-payer healthcare legislation, the House's net spending agenda would still increase federal outlays by $37.5 billion. It is still very possible that the Senate's net agenda will increase significantly with the introduction of more "big-ticket" healthcare and stimulus proposals as seen in the House.

Read the full BillTally report online here.

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The Late Edition: November 4, 2013
Posted By: Curtis Kalin - 11/04/13

Today’s Taxpayer News!

Costly skies: The state of Illinois spends more than $4 million a year flying state officials from Chicago to Springfield. An investigation by Fox 32 Chicago found that almost half of all flights have four or less passengers aboard, wasting the estimated $3,000 per flight cost.

Welfare waste: Beneficiaries of Tennessee’s welfare program have used state issued Electronic Benefit Transfer cards on outlandish expenses, state records show. Funds were used on liquor, cafes, electronics, and even theatre tickets in Memphis.  Read more at WMCTV.

Unspent funds: The Department of Labor’s Navajo Nation educational program has grossly mismanaged taxpayer funds even as thousands wait for job training. A federal investigation showed that the program failed to spend $13.4 million while only serving 62 percent of its expected participants. More details at the Washington Times.

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The Myth of the 12.6 Percent Effective Corporate Tax Rate
Posted By: Curtis Kalin - 11/04/13

A May 2013 report by the Government Accountability Office (GAO) claimed that U.S. corporations paid an effective tax rate of just 12.6 percent - a startling revelation considering the U.S. now has the highest statutory corporate tax rate in the world at 35 percent. As a wary taxpayer might expect however, there is more to the story…

The GAO study was used by many to bolster the notion that tax loopholes and offshore “tricks” allowed American businesses to duck a great deal of their tax burden. The party for those seizing on this opportunity was short-lived, however, as a more complete analysis performed by international tax expert Andrew B. Lyon (with Pricewaterhouse Coopers ) showed real and significant problems with GAO’s analysis.

Lyon’s study, published in the academic journal Tax Notes last month, exposed glaring omissions that skewed GAO’s baseline finding. Most evident was GAO’s use of just the year 2010 in their analysis.  In making their judgment, they selected a narrow window of time that that just happened to coincide with loss write-offs resulting from several years of the Great Recession. Lyon took a more comprehensive approach, breaking down the corporate rate from 2004-2010.  His finding was that long-term, “The effective tax rate based on worldwide current tax payments for all U.S. corporations exceeded 35 percent for the 2004-2010 period.”

What’s more, Lyon’s more comprehensive methodology found that even during the limited period GAO examined, effective corporate income tax rates well exceeded the 12.6 percent reported by GAO, largely because the agency failed to account for taxes paid to foreign governments on certain income dividends received by American companies.

An effective tax rate of 35 percent ranks highest among industrialized nations and has America lagging behind in terms of tax competitiveness. With unemployment in particular remaining a challenge for the U.S., it is important for policymakers to clearly understand the damage a punitive corporate income tax rate causes our economy. Taxpayers should not be fooled into a false choice using false facts. How the GAO could issue such a flawed study is another question…

Andrew Lyon’s very in-depth study is highly recommended for those looking to dive deeper into this discussion, read it HERE.

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Five Quirky Taxes to Watch Out for on Tuesday's Ballot
Posted By: Curtis Kalin - 11/04/13

It’s almost Election Day and voters in several states and many more localities will head to the polls to decide the fate of numerous fiscal ballot measures. Some of these proposals stand out more than others. Below we’ve listed the top five strange (and what many would consider punitive) tax issues on the ballot in 2013 that our research has identified:

  1. Airplane tax: The state of Washington is holding an advisory vote (#4) to approve the state legislature’s imposition of a new tax on companies frequently operating planes in the state. The tax would feature tiered fees based on the aircraft’s weight.
  2. Marijuana tax: Colorado was one of the states in America to legalize recreational use of marijuana in 2012. Not far behind this legalization came ballot initiatives to tax it. If passed, Colorado’s Proposition AA would impose a 15 percent excise tax on all recreational marijuana purchases in the state, as well as a 10 percent sales tax.  Voters in the cities of Boulder and Denver are considering measures that give their cities authority to impose additional sales and excise taxes on marijuana as well.
  3. Soda tax: Also in Colorado the town of Telluride is considering a one-cent per ounce tax on sweetened beverages. The revenue generated would go to children’s physical education programs in schools. Remember this is ‘per ounce’, making it a not-insignificant burden.
  4. Hotel tax: The California city of Selma is considering doubling the occupancy tax on hotels, inns, and other lodging from six to twelve percent. The tax in Measure K applies to all lodging for stays less than 30 days.
  5. Oil well tax: Still in California, the voters of Santa Fe Springs will vote to more than double the tax on barrels of oil drilled.  Measure S would take the tax from 20 cents a barrel to a maximum of 52 cents.

Also of note for local taxpayers: In California 87 school districts will vote on 45 local bond/tax measures totaling $22 billion. This far exceeds what any other state in America has on the ballot. Additionally, Arizona voters will be deciding on 11 local ballot measures that would implement $209 million for education bonds and $311 million in non-education related bonds (public safety, parks, roads, etc.)

There are many more state and local measures of note. Other entries – strange or not – from sharp-eyed taxpayers across the country are welcome!

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What Tricks & Treats Face Taxpayers this Election Day? And BillTally’s New Report - Speaking of Taxpayers, Nov. 1
Posted By: Douglas Kellogg - 11/01/13

Subscribe to NTU's podcast "Speaking of Taxpayers" via iTunes!


State Affairs Manager Lee Schalk talks NTU's 2013 Ballot Guide, even in an off-year election billions are on the line; and NTUF's Demian Brady talks about Congress' spending trends in their first 6 months. Plus, the Outrage of the Week! 

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Do Spending Cuts Lose Favor Over Time?
Posted By: Michael Tasselmyer - 11/01/13

Yesterday, NTUF released a special BillTally report examining the first six months of the first session in the 113th Congress. The report comes as lawmakers begin to debate several long-term budget issues, not the least of which is the fact that under the terms of the compromise that ended the recent government shutdown, federal funding will again run dry by early February unless Congress takes further action.

The 113th Congress has, at least to this point, shown a reluctance to address U.S. budgetary dilemmas by cutting spending. Through the first six months of 2013, Congress has introduced 554 bills to increase spending, as opposed to just 114 that would reduce outlays –- a nearly five to one ratio. For context, that ratio in the previous Congress was 3.9 and 4.6 to one in the House and Senate, respectively. Across both Chambers, the 113th Congress has introduced a net spending agenda of $1.28 trillion: about $1.74 trillion in increases and $453 billion in savings.

Perhaps more concerning for taxpayers who are wary of mounting debt and deficits is that if previous legislative trends are any indication, it's unlikely that Congress will introduce savings proposals any more quickly over the rest of the session.

In the 112th Congress, NTUF identified 221 House savings proposals over the course of the two year term. 52 percent of that total had been introduced by the end of the first 6 months, and over 74 percent were considered by the end of the first year. In other words, only about a quarter of any major savings proposals were introduced over the entire final year of that Congressional session.

The 112th Senate followed a similar trend: by the end of the first six months of the two year term, about 56 percent of all savings bills had been introduced. Just over 81 percent of the Senate’s savings legislation had been submitted by the end of the first year.

Through July of this year, the current Congress introduced 81 savings bills in the House and 33 in the Senate. The House had already submitted 72 percent of its savings bills by the end of March, and the Senate had reached 70 percent of its total in that same time.

Although it's impossible to predict how the current Congress might act going forward, history shows that legislative proposals to cut spending tend to be considered earlier rather than later. If that holds true for the 113th Congress, the window for significant savings legislation to be considered may be closing as the year comes to an end.

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Billions on the November 5 Ballot
Posted By: Lee Schalk - 11/01/13

This week, NTU released its 2013 Ballot Guide: The Taxpayer’s Perspective. Our findings might surprise you.

As we all know, there’s no Presidential race this November, nor is there a regular round of Congressional elections. However, voters in Colorado, Maine, New Jersey, New York, Texas, and Washington will decide on statewide ballot measures that will impact the nation’s fiscal policy. Additionally, many taxpayers will find local ballot measures when they head to the polls on November 5. Here are the highlights from our latest guide:

  • Major tax hikes are on the docket in Colorado: Amendment 66, the $1 billion income tax hike for education and Proposition AA, a pair of sales and excise taxes on marijuana, a product recently deemed legal by Coloradans.
  • Taxpayers in Telluride, Colorado will decide on a penny-per-ounce soda tax. Last November, two California cities that voted overwhelmingly for President Obama vetoed similar measures.
  • Maine and New York residents will decide on debt increases. Voters in Maine are being asked to increase state debt to fund everything from the Army National Guard and higher education to transportation and the Maritime Academy, while New York’s Proposal 3 would allow localities to keep exceeding debt limits.
  • In addition to the gubernatorial race, New Jersey taxpayers will find a 27 percent minimum wage increase on their ballots next week, from $7.25 to $8.25 per hour. SeaTac, Washington voters will decide on a minimum wage hike to $15 per hour. Significant economic evidence that shows higher minimum wages can actually reduce overall employment.
  • Should Texas tap into its Rainy Day Fund to pay for local water projects? It will be up to Lone Star State taxpayers to decide, and the outcome will determine whether or not officials must rein in some of their spending plans.
  • Following the Detroit bankruptcy, pension reform became one of the hottest issues of 2013. Voters in Cincinnati, Ohio and Hialeah, Florida will face questions regarding a transition to defined contribution plans for new city employees and the elimination of newly elected officials’ pension payments, respectively.
  • Washingtonians have a chance to strengthen their own initiative and referendum process by allowing more time for signature collection and imposing penalties for those who interfere.

State and local measures can have major implications not just for the citizens deciding them but for taxpayers nationwide. Whether it’s the massive Colorado Amendment 66 tax hike, significant debt increases in Maine, or an attempt to bolster the initiative and referendum process in Washington, voters in many parts of the country will encounter some eye-opening that could impact their wallets for years to come.

Stayed tuned to NTU.org for our post-election ballot measures analysis.

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BillTally Report: Congress Still Proposing New Spending
Posted By: Michael Tasselmyer - 10/31/13

As we approach the final weeks of the first session in the 113th Congress, taxpayers have already been faced with a number of major legislative shakeups in Washington, D.C. From automatic sequestration cuts to the rollout of several major provisions of the Affordable Care Act – and a multi-week government shutdown, to boot – there’s been a lot for citizens to consider as they reflect on how their Representatives and Senators have used their tax dollars.

Fortunately, National Taxpayers Union Foundation (NTUF) has been keeping tabs on Congressional budget proposals through its BillTally project – the only comprehensive database that tracks every major spending and saving bill introduced on Capitol Hill. In a new Policy Paper, NTUF Director of Research Demian Brady has crunched the BillTally numbers from the first six months of the current session of Congress to offer taxpayers perspective and insight into how the proposals we’ve seen so far measure up to those in previous years.

Among the major findings:

  • In the House, NTUF was able to score 438 bills over the first six months that would affect the budget by $1 million or more. For every bill that would decrease federal outlays, there were 4.41 that would increase them. Over the entirety of the 112th Congress, that ratio was 3.87.
  • In the Senate, NTUF found 230 such bills over that same time, with a ratio of 5.97 spending increase bills to every one savings bill. In the 112th Congress, the Senate’s ratio was 4.6.
  • Excluding overlapping bills, the House proposed a net $1.2 trillion budget increase, already higher than the previous Congress’ $1.12 trillion over its first year. The Senate offered a net savings agenda of $46.8 billion, which is lower than the 112th’s $405 billion net increase in its first year, but does not include any high-cost universal health care proposals.
  • Across both Chambers, legislators introduced a net spending increase agenda of $1.28 trillion in their first six months, which is almost exactly the same total agenda proposed over the course of the entire 112th Congress.

Brady also analyzed lawmakers’ proposals by policy category, and found that health care and job creation/”stimulus” measures carried the highest costs to taxpayers. Among the least expensive proposals – those that would reduce federal spending the most – were across-the-board spending cuts, Affordable Care Act repeals, and tax code reforms that would reduce or eliminate many refundable credits.

Overall, although the 113th Congress has introduced its share of spending cuts, Brady’s analysis shows that at least over the first six months, it is doing so at a slower pace than the 112th. That finding comes at a time when many Americans are still concerned over mounting deficits and no sure sign that a long-term budget deal will be worked out in the coming months.

To read the full report online, complete with in-depth data, charts and analysis, click here. A press release with summary information can be found here.

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The Late Edition: October 31, 2013
Posted By: Curtis Kalin - 10/31/13

Today’s Spooky Taxpayer News!

More website waste: A new report from CBS News reveals that 15 of the state-based exchange websites for Obamacare are facing errors and cost overruns that total more than $1 billion. Also alarming are reports that contractors were paid to do duplicate jobs among the states.

Backlogged parks: In the wake of the National Parks Service’s questionable actions during the ‘shutdown’, the agency is now drawing fire for failing to use their allotted taxpayer funds to solve the backlog of maintenance issues at parks. Almost $2 billion of money allocated to fix toilets, clean monuments, and fixing outdated utilities were instead used to send rangers to a wine tasting and a Michigan car show. Read more at B98.5 FM.

Green tech mess: The scope of financial and environmental damage from a taxpayer funded solar company is now being realized. After receiving a loan guarantee from the federal government, Abound Solar went bankrupt in 2012, leaving taxpayers to pick up a $40-60 million tab. What’s worse, the company left toxic chemicals at the site and the cleanup will cost another $3.7 million. Moe details from the Heartland Institute.

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Beat Back the Wicked Witches of Spending: Donate to NTU Foundation
Posted By: Dan Barrett - 10/31/13

hh2013The National Taxpayers Union Foundation wishes you a Happy Halloween! With your help, we can make scary spending scarce!

From commemorating Milton Friedman’s work to giving taxpayers the best and latest research, NTUF has done a lot this year. With the support of taxpayers like you we don’t plan to stop! Now more than ever, NTUF’s timely research and the BillTally project -- the ONLY comprehensive tracking system that looks at what federal legislators want to spend -- is needed to hold back the fiscal phantoms and debt demons.

How can we help save America from the spending specters? By educating citizens on the often complex issues and proposals that make their way through the halls of Congress. NTUF has taxpayers’ backs, arming Americans with knowledge, analysis, and real-time estimates to stay ahead of the most frightening tax and spending legislation being crafted on Capitol Hill.

NTUF’s work doesn’t stop there. Like Van Helsing, we stay vigilant through the dark of night to keep tabs not only on elected officials but candidates seeking reelection or higher office. Just recently, we examined the budgets proposed by New Jersey Senate contenders Cory Booker and Steve Lonegan.

With your $100, $50, or even $25, the best is yet to come. We will continue to provide insights and analysis the hard numbers behind politicians’ soft talk, but we need your help! NTUF doesn’t take public dollars. We depend on the help of Americans like you to bring our timely and important research to taxpayers across the country.

THANK YOU for your past support. We look forward to working together for a better future.

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