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In case you hadn’t noticed already with all the news over recent years about the D.C. area’s rising real estate prices, or new status as a millennial hotspot, or the city’s weathering of the recession, the Washington Post’s feature story on the beltway’s decade-long boom should bring the point home.
Certainly there are other regions that have done just fine during the “Great Recession”, an oil and gas boom in North Dakota has created thousands of jobs, while Texas has worked to maintain a friendly business environment, fostering new business, and snagging existing businesses from tax-heavy states like California.
Yet, these states earned that growth, Washington, D.C. has a better trick: let someone else earn it. Thus, as the Post points out, government spending and power fueled this growth in the District, and that means taxpayers.
The Post writes:
“Two forces triggered the boom.
“The share of money the government spent on weapons and other hardware shrank as service contracts nearly tripled in value. At the peak in 2010, companies based in Rep. James Moran's congressional district in Northern Virginia reaped $43 billion in federal contracts — roughly as much as the state of Texas.
“At the same time, big companies realized that a few million spent shaping legislation could produce windfall profits. They nearly doubled the cash they poured into the capital.”
Since 2000, and including 2013 projected revenue, the federal government has taken in $31 trillion in revenue – still managing to run a deficit all but two of those years… It won’t comfort taxpayers much that another $8.2 trillion was thrown on to the credit card after the last surplus in ‘01.
The long and short of it is that while D.C. has been living it up, taxpayers throughout the rest of the country have provided the backing for the good times being doled out through federal contracts, not to mention rising costs for government workers and programs like the stimulus.
The increase in lobbying expenditures may seem less connected to the direct flow of cash into Washington at first glance, but it is clearly no coincidence that a growing government would offer more opportunity – or require it from any business reluctant to take part – for lobbying.
We all pay the price for a system that is increasingly based on power and favor trading, rather than fostering a market system that truly responds to the needs of individuals.
The Post takes a somewhat optimistic track on how cottage industry built around this spending boom may lead to new private sector-only entrepreneurship. But will the taxpayers who provided a decade of seed money while dealing with a struggling economy see any return on that “investment”?
It’s an unwieldy example, however, it’s worth remembering that in the old Soviet Union the big cities starved the countryside to insulate themselves from the country’s economic failures (heck even in the currently-popular Hunger Games series we see a capital city’s excess maintained on the backs of an oppressed outer population).
That’s not to suggest that’s precisely what’s happening, those examples and more simply illustrate why this sort of trend is worth keeping a cautious eye on.0 Comments | Post a Comment | Sign up for NTU Action Alerts
2013 Review: Lingering Deficits Despite Record Revenue
As the budget committee debates how it will reach a long-term deal by the December 13 deadline, the Congressional Budget Office (CBO) has been compiling the numbers behind the 2013 Fiscal Year, which ended just over a month ago. CBO's recent report ("Summary For Fiscal Year 2013") shows that for the first time since 2008, the U.S. Government ran a deficit of less than $1 trillion, as it spent $680 billion more than it collected.
The small "victory" that is a smaller deficit was accomplished largely thanks to increased tax revenues. Although federal outlays in 2013 were $84 billion less than the totals in 2012, the government collected $325 billion more in taxes than it did in 2012, which means that the growth in tax revenue was over four times as much as any reduction in federal spending.
The report also confirmed that spending on entitlement programs like Social Security, Medicaid, and Medicare all continued to grow at a rapid pace, even as spending on other programs related to defense and unemployment benefits declined. Those three entitlement programs each grew by over five percent, with spending on Social Security benefits breaching the $800 billion mark. The spending on these programs in Fiscal Year 2013 represented over 9 percent of GDP.
The numbers suggest that, as NTUF has pointed out before, entitlement reform will have to be revisited as a debt- and deficit-reduction measure as spending on these programs continues to offset not only the highest tax revenues Washington has had to work with in years, but significant cuts to defense spending in the wake of sequestration caps. As the latest BillTally report shows, however, Congress has seemingly lost some of its focus on finding ways to reduce spending: through the first six months of 2013, Congress proposed $3.83 in additional spending for every dollar they proposed to cut, and healthcare-related legislation was the costliest in both Chambers.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Lots of Ways to Learn About Congressional Spending
NTU Foundation is getting the word out about how Congress is planning to spend your tax dollars. For 20 years, the BillTally system has tracked every proposal introduced in the House and Senate to show taxpayers and legislators exactly what would happen if one, several, or all the active bills in Washington, D.C. were enacted. The first half of 2013 saw many bills to cut government spending but many more to increase expenditures on an annual basis. In our latest study, NTUF researchers found that Congress would grow public programs and efforts by $1.28 trillion per year. But, of course, that's not the whole story and is just one of the several findings that NTUF's research has brought to light.
Elected officials in each Chamber of Congress have laid out many different paths for the country's fiscal future. Besides consulting the line-by-line details in the full BillTally report by Director of Research Demian Brady, there are a variety of mediums for you to get the information you need to educate yourself on where Congress wants to take your tax dollars.
For the visually inclined, there are four infographics, each detailing a part of the BillTally report. If you want to see what the entire Congress or what each chamber has proposed (House and Senate), we've parsed out the data so you don't have to. An interesting fourth visualization takes a look at when savings bills have been introduced in both the previous Congress and in 2013. One of the questions we are constantly looking at is when and how cut proposals are taken up because spending reductions do not happen without legislative action.
The audio-lovers are not forgotten as Brady went on NTU’s weekly podcast, Speaking of Taxpayers, to give you the highlights and important findings of how the Tea Party has affected spending proposals and whether net agendas are following historical trends or breaking new ground. For the first time, NTUF staff exhibited our on-camera skills by hosting a Google Hangout:
Of course, there are overviews of the report in the form of press materials and in-house summaries but perhaps more importantly are some posts by Policy Analyst Michael Tasselmyer that delve between the lines. So far, he has posted on two of Congress' larger spending categories, healthcare and jobs programs, and on the timing of savings proposals. Additionally, Tasselmyer explored the differing defense budgets of the House and Senate (the findings may surprise you). Perhaps you want to know which bills would most dramatically affect the budget? We've got you covered.
Is this the first you're hearing of the many levels of BillTally analysis? If so, you can be on the cusp of Congressional research by subscribing to The Taxpayer’s Tab, NTU Foundation's weekly update. Tab subscribers are the first to see the costs and implications of bills making the headlines and generating buzz in the policy world. Not a fan of email or love NTUF so much that you want more? Follow us on Twitter and give us a shout out! And remember, there's a lot of ways that NTU Foundation helps out Americans and we're always looking for new members. Are you up for a challenge of getting government spending under control? We need you!
Was there a part of the recent BillTally report that surprised you? Post what your thoughts are on the $1.28 trillion in new spending that Congress could pass below.0 Comments | Post a Comment | Sign up for NTU Action Alerts
BillTally Report: Congress Still Proposing New Spending
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:
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.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Senate, House to Vote on Resolutions to Stop Debt Ceiling Suspension
Today the Senate, and tomorrow the House, are expected to vote on resolutions (S.J. Res. 26 and H.J. Res. 99 respectively) that disapprove of President Obama’s suspension of the debt ceiling until February 7th. One of the provisions of the Continuing Resolution/Debt Limit compromise (H.R. 2775) of only about two weeks ago was to give Congress the chance to end the suspension of the debt limit via an expedited resolution process. Technically, this does give Congress back some of the “power of the purse” it abdicated via yet another debt ceiling suspension, but the truth is that this will be little more than a show vote.
Nothing short of a miracle could give S.J. Res. 26 the votes it needs to pass in the Senate. Across the Hill, H.J. Res. 99 is expected to pass the House and promptly stall, as it will neither be able to pass the Senate nor garner anywhere near enough votes to override a veto from the President (should the unthinkable happen in the Senate). This means a free-pass for many Members who want the chance to say they oppose overspending without any real-world implications.
The resolutions at hand are far from the serious reforms we urgently need. Rather than continue on this unsustainable trajectory, in which debt ceiling increases are routine, Congress must demonstrate a clear, credible plan to reduce expenditures.
Continually raising the debt limit without the serious reforms necessary to rein in our out-of-control spending only compounds the uncertainty and drag that weighs down our economy and potential for growth. It is likewise a moral imperative not to continue taking out lines of credit at the expense of future generations whose own prosperity is equally uncertain.
It is essential that Congress adheres to the principles NTU repeatedly outlined during consideration of H.R. 2775:
1. Do not raise taxes
2. Resist the temptation to include extraneous measures
3. Preserve the sequester
4. Enact meaningful entitlement reform.
Our debt and spending problem is so massive, even the most aggressive, confiscatory tax plans can’t begin to fill the hole left by profligate legislators and administrations – not to mention the negative economic consequences of such tax schemes. Loading down “must-pass” legislation with other favored projects obscures the issue, and unnecessarily muddies the water in the search for votes.
Failing to address the real spending problem at the heart of repeated “debt ceiling crises” by dismantling the sequester or failing to enact meaningful entitlement reform only makes these issues increasingly hard to tackle and ensures that just a few short months from now we’ll be here again, looking up from the bottom of an even deeper hole.
Go here to tell Congress to “Keep the Caps” and stop the spending binge.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Today’s Taxpayer News!
Costly questions: The National Endowment for the Humanities is spending hundreds of thousands of taxpayer dollars in an attempt to answer timeless philosophical questions such as “what is the meaning of life?” and “why are people bad?”. The NEH budget runs at about $150 million per year. The Washington Examiner has more.
Failure to navigate: As the new healthcare exchanges still face tech difficulties, the Department of Health and Human Services is adding $13 million to the “Navigator” program that is supposed to help uninsured Americans traverse the new health exchanges. However, even before the program earned a raise, over half of Americans don’t know what the exchanges are and HHS has still refused to release a number of actual enrollees. More details at the Gardner News.
Pricey political food: Members of Cleveland area city councils have spent into the thousands on pre-meeting meals and snacks and using taxpayer money to do so. One council president defended the meals saying, “It is an incidental expense that is well within our authority.” The Cleveland Plain-Dealer has more details.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Let’s Make a Debt Deal - Speaking of Taxpayers, Oct. 18th
Subscribe to NTU's podcast "Speaking of Taxpayers" via iTunes!
NTU Vice President Brandon Arnold joins the podcast once again to discuss what happened in Congress this week with the deal that raised the debt ceiling and ended the government shutdown.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Newark Mayor Cory Booker won Wednesday’s special election for the open New Jersey Senate seat, but taxpayers may not be aware of the policies that he plans to bring to the higher chamber. Fortunately, NTU Foundation released studies on the spending that Mayor Booker and his opponent, former Bogota Mayor Steve Lonegan, proposed before the election to inform those in the Garden State exactly what the candidates said and how their words could translate into changes in the federal budget. We highlighted the candidates’ agendas by posting their full line-by-line reports, creating easy-to-read infographics, and offering taxpayers additional information to understand what programs the two candidates would add or drop from the government’s ledger. Now, let’s take a look at exactly what New Jerseyans have voted for and how the rest of the country might be affected by this special election.
We used direct quotes from Booker and his campaign literature and matched it with budget proposals, existing legislation (as scored by the BillTally system), and other estimates by third parties, like the Congressional Budget Office (CBO) and the Government Accountability Office. Any proposal that could not be clearly identified or quantified was listed as an unknown cost. Our intention is to show how detailed the platforms were and where the candidates needed to give the public more information.
Booker’s Overall Platform: NTUF found that, overall, he would increase spending by $33 billion each year. The total is the net effect of 23 measures that were able to be identified (20 spending increase items and three decreases). An additional 35 policies that Booker said or wrote about had unknown costs or savings.
His Policy Focus: Booker’s key points of emphasis were on improving America’s education and criminal justice systems. For education, the study identified seven policies that would change how the Department of Education facilitates higher education. Many aimed to increase student aid in the form of more and larger Pell Grants and ensuring that subsidized Stafford Loans would remain available at low interest rates. Just taking new spending for colleges and universities, NTUF found that two of the proposals would increase spending by $654 million and could not determine the costs associated with the other five. The seven measures are strictly spending dedicated to higher education; other proposals like doubling research grants in the America COMPETES Act would likely increase spending for colleges as well.
Booker’s other goal was to improve the criminal justice system. This category had a wide range of policies but making overall improvements to how courts interact with criminals and inmates make up the largest number of proposals (five). Approximately $136 million in additional funding would be allocated to the Department of Justice for the three items that NTUF was able to quantify. One would increase spending by giving more funds to local entities for community drug courts and two would decrease spending: eliminating the crack and powder cocaine disparity, and decreasing the number of criminals in prisons. We could not put price tags on two other measures: eliminating mandatory minimum sentencing and ending the use of private prisons.
The Senator-Elect’s Spending Focus: Even with the multitude of proposals mentioned above, one platform point that Booker made in a campaign policy paper made up over 60 percent of his total annual spending total: passing comprehensive immigration reform. As already passed in the Senate, Booker pledged to pressure the House to also pass the bill, which would overhaul the current system and increase border security and infrastructure. Using a CBO estimate of the Act as passed, NTUF credited Booker with a $20.2 billion spending increase. Another policy that was touched on in the above section is doubling federal research spending related to the America COMPETES Act. We used spending figures from a 2013 Congressional Research Service report and mapped out how much spending would increase each year to reach a total $58 billion by FY 2021. It was determined that such a measure would mean an average $4.9 billion rise in funding for each of the next five years, and additional increases thereafter.
His Savings Plans: Booker’s three savings proposals include the two mentioned in his criminal justice system reforms and repealing spending associated with oil and gas exploration. His stance against providing benefits to oil and gas companies is one that has appeared in numerous campaigns at both the Senatorial and Presidential levels, but almost all of the budgetary points occur on the revenue side in the form of tax credits. The one program that does include outlay costs is the Ultra-deepwater Oil and Gas Research and Development Program. The President’s FY 2014 Budget request proposes to phase this program out, which would save $50 million over three years. Booker has supported this proposal as well.
What All of This Doesn’t Include: The 35 proposals that NTUF was unable to score in Booker’s platform cover a wide range of government programs and activities. For example, he proposed to support climate change legislation without offering details about what kind of action he would like to see (presumably a carbon tax or a cap-and-trade system). Another example is his entire health care plan, in which he seeks to increase prenatal, preventative, and outreach services. Some points include grants while other statements only go so far as to say he wants to see improvements in a certain care area.
What taxpayers should take away from NTUF’s study is that Booker, as well as Lonegan, did not offer enough information to Americans during their campaigns. As a result, we truly do not know what a budget would look like in the eyes of Cory Booker. Some of his points would decrease spending but it is unclear how much of those savings would offset his proposals when considered with how much his unknown items could cost.0 Comments | Post a Comment | Sign up for NTU Action Alerts
986 Billion Shades of Grey: Debt Deal Dodges Big Decisions
On the evening of October 16th, Congress sent H.R. 2775 to President Obama, who promptly signed it into law. The legislation temporarily restores funding for certain parts of the federal government and suspends the debt limit. Though many members of the political and economic community greeting this development with relief, passage of H.R. 2775 isn’t cause for a celebration – it contains mixture of both good and bad policies. More than anything, the bill buys Congress a few additional months to work on the most critical fiscal issue facing the nation: the long-term debt crisis.
When it comes to the federal debt, fiscal conservatives should be disappointed by the bill’s failure to meaningfully address the problem. Tackling the issue isn’t easy, as it requires reforms to popular programs like Social Security, Medicare, and Medicaid, but doing so is imperative for the nation’s fiscal well-being. The agreement provides barely a glimmer of hope for entitlement reform by requiring House and Senate negotiations on a budget. Taxpayers should demand much more from Congress. Between now and February 7, when the debt ceiling will need to be readdressed, lawmakers should pursue spending reductions in an amount that is at least commensurate with the debt ceiling hike.
On the positive side, the bill preserves the sequester – although it could have been better in this regard. It funds the federal government at a rate of $986 billion, which is higher than the sequestration spending cap of $967 billion. Congress should have simply reduced funding to the statutory requirement, but instead chose to rely on the sequestration mechanism to bring spending in-line with the law. This is acceptable – as long as Congress keeps the sequester in place. To make sure they do, taxpayers must be extremely vigilant, as many big-spenders in Washington are already working to undo it. In fact, Senate Majority Leader Harry Reid (D-NV) reportedly rejected a proposal that would have given the executive branch more flexibility in adjusting to the cuts precisely because he feared doing so would make it more difficult to trash the sequester. Keeping the sequester spending caps in place will be one of the biggest policy battles over the next several months. You can help NTU’s efforts to “Keep the Caps” by clicking here.
Oftentimes when Congress considers “must-pass” pieces of legislation, Washington lobbyists frantically try to tack on unrelated bills or amendments that benefit their clients. Thankfully, H.R. 2775 did not contain any major extraneous provisions, like the Internet sales tax or an extension of the Farm Bill. However, it did include a number of smaller, unnecessary add-ons. For example, the bill featured a $2.9 billion authorization for a dam project in Kentucky. Also included was a $174,000 payout to the widow of the late Sen. Frank Lautenberg. While it is customary to provide a year’s salary to the families of deceased lawmakers, in light of the Lautenberg family’s vast wealth, other benefits available to survivors, and the urgent nature of this bill, Congress could have foregone this extra payment.
On the issue of revenues, taxpayers may have dodged a bullet on H.R. 2775. It contained no new taxes or, as they are sometimes called, revenue-raising “loophole closures”. Once again, taxpayers must be vigilant on this issue. As Congress looks to reduce debt, many left-leaning politicians will attempt to hike taxes despite the fact that the Congressional Budget Office expects that revenues will soon exceed their 40-year averages. Please stay tuned as NTU will be engaged on this important issue and will need informed citizens like you to help us fight against tax hikes.
Overall, H.R. 2775 was a mixed bag of policies – good, bad, and ugly. Now that passage has occurred, it’s time for Congress to really get to work. Tell your elected officials to pass meaningful reforms to entitlement programs and Keep the Caps by protecting the sequester.0 Comments | Post a Comment | Sign up for NTU Action Alerts
On Monday, NTU Foundation released a line-by-line study of what Newark Mayor Cory Booker and former Bogota Mayor Steve Lonegan would support if elected as Senator of New Jersey. We found that, of the policies we were able to quantify and score, Mayor Booker would increase spending by $33 billion and former Mayor Lonegan would decrease the federal budget by $68 billion. However, that's not the whole story. Both candidates had large holes in their agendas by either offering proposals that were too vague to be matched with current legislation or CBO cost estimates or they failed to even address an issue category (both said nothing regarding changing veterans programs).
What you should take away from this study: While it appears that Booker would grow the federal government and Lonegan would shrink it, both needed to offer taxpayers more information and details on exactly what they would do. This is something that plagues many campaigns and races, be it Senate races in 2010 or the 2012 GOP primaries. Both candidates touted themselves as the best choice for New Jersey and for improving the lives of Americans but neither laid out how they would accomplish such goals.
What you should espeically pay attention to: The largest proposal of each candidate. Booker would seek to pass comprehensive immigration reform legislation that has already worked its way through the Senate. The bill would increase spending by $20.2 billion each year and, similar to previously introduced measures, would increase border security spending and remake the immigration process. Lonegan has pledged to repeal the Affordable Care Act, which NTUF found would result in a $63.9 billion spending decrease each year.