Paul Pounces On Lagging Super Committee

By Adrianna McGinley

Presidential hopeful Rep. Ron Paul (R-Texas) blasted the so-called super committee for failing to produce a plan to reduce the national deficit by $1.2 trillion over the next 10 years, an amount Paul called “laughably small.”

In a statement released Monday, Paul said the super committee “merely needs to cut about $120 billion annually from the federal budget over the next 10 years to meet its modest goals, but even this paltry amount has produced hand-wringing and hysteria on Capitol Hill.”

Paul said the cuts the 12-member panel was tasked with making were from previously proposed increases, and nothing substantial would have emerged even if a deal was made. The fact that they did not accomplish that goal, Paul said, “shows how unserious politicians are about our very serious debt problems.”

The Texas congressman accused the federal government of “lying” when promising to provide Social Security, Medicare and Medicaid benefits to future generations while simultaneously “maintaining our wildly interventionist foreign policy.”

To eliminate new debt and create a balanced budget, Paul proposed returning to the $2.3 trillion federal budget of 2004, a figure he estimates will match that of the national GDP.

“Was the federal government really too small just seven years ago, in 2004? Of course not,” Paul said. “Only Washington hysteria would have us believe otherwise.”

The super committee is expected to announce Monday that no deal has been reached.

CBO Projects Lower Living Standards If Current Laws Are Not Modified

By Sarah Mamula - Talk Radio News Service

Congressional Budget Office (CBO) Director Douglas W. Elmendorf announced Wednesday that the CBO’s most recent projections offer a bleak future for the nation’s standard of living and it’s federal debt.

According to a report released by the CBO, federal debt will hit 62% of the United States’ GDP by the end of 2010, a percentage not reached since the aftermath of WWII. If current laws are not modified, the CBO projects that federal spending on healthcare programs will grow from about 5% of GDP today, to nearly 10% by 2035.

“Reaching agreement on longer term reductions in spending or increases in taxes or some combination as quickly as possible would support the economic recovery,” said Elmendorf.

The CBO Director said there are two scenarios that will work to prevent such projections from becoming a harsh reality. The “extended-baseline scenario” would implement a steadily increasing average tax rate. In addition, rising tax rates and provisions in the newly passed healthcare bill, the CBO projects that revenue would grow to 23% of GDP by 2035. 

Under an “alternative fiscal scenario,” major changes in current legislation would have to take place. According to the CBO, under this plan “most of the provisions of the 2001 and 2003 tax cuts would be extended, the reach of the alternative minimum tax would be kept close to its historical extent, and that over the longer run, tax law would evolve further so that revenues would remain at about 19 percent of GDP.” 

Dodging giving recommendations to Congress, Elmendorf said that “ultimately, if the debt grows unchecked… it means declines in people’s standards of living.”

Senators Call For Task Force To Repair Debt

By Leah Valencia, University of New Mexico- Talk Radio News Service

Sens. Kent Conrad (D-N.D.) and Judd Gregg (R-N.H.) called on Congress Wednesday to repair the national debt, introducing legislation to create a bipartisan task force to address the long-term budget crisis.

“The biggest threat that faces our nation today is our fiscal situation at the federal level,” Gregg said during a press conference. “We are on a path to bankruptcy as a nation.”

The Task Force for Responsible Fiscal Action Act would be made up 16 Congressional Members and two officials from the Obama administration, including the Secretary of the Treasury. The task force would deliberate to create recommendations to solve fiscal imbalances.

The commission would function under a supermajority. For recommendations to be submitted for a vote, 14 of the 18 members would have to approve it.

“What we have outlined here has the best prospect of success but what is absolutely essential is that there be a special process, that it be bipartisan and that it lead to an assured vote on the work product of the task force,” Conrad said.

Both Senators said they want the bill to be a part of the upcoming vote to increase the debt limit, adding that they will not vote to raise the federal debt limit unless Congress commits to the task force.

“We’re saying very clearly that we’re not going for debt limit extension without an approach like this being included,” said Conrad. “We’re not going to relent on this and we’re not going to agree to any kind of long-term debt limit extension.”
 
The bill has 24 bipartisan co-sponsors thus far: nine Democrats, 14 Republicans and one Independent.

Bipartisan Group Pitches Commission To Examine Federal Overspending

John DuBois - University of New Mexico/Talk Radio News Service

Speaking before the Senate Budget Committee on Tuesday, Rep. Frank Wolf (R-Va.) called for the creation of a bipartisan, 16-member panel to examine federal spending. The "Securing America's Future Economy" (SAFE) Commission would make recommendations to Congress regarding ways to limit overspending and would force lawmakers to vote on them.

According to Sen. Joe Lieberman (I-Conn.) the nation's deficit exceeded $1.4 trillion during the last fiscal year. Lieberman and other Democrats including Sen. Kent Conrad (D-N.D.) are in support of Wolf's proposal, making it a truly bipartisan bill.

Said Conrad, “We must also address the demographic challenge we face in Social Security and the revenue challenge we face from an outdated and inefficient revenue system."

The SAFE Commission mirrors legislation proposed by Wolf and Rep. Jim Cooper (D-Tenn.) in 2006. That bill, called the "Securing America’s Future Economy Commission Act," aimed to reform U.S. tax policy and entitlement benefit programs.

Lieberman argued that implementing Wolf's proposal will effectively help the country get back on the right fiscal track.

“The only way we will be able to make the difficult decisions needed to reduce our national debt is to create a special commission whose sole focus is to develop solutions to the long-term fiscal problems that our country faces,” said Lieberman.

Added Sen. George Voinovich (R-Ohio), “The federal government is the worst credit card abuser in the world and we’re putting everything on the tab of our children and grandchildren.”

“We can continue down the same path, which means that in just 15 years every penny of the federal budget will go toward entitlement spending and retiring our debt, or we can start making the hard choices now," said Wolf.

"Spending money I haven't made yet for things I don't want."

Coffee Brown, University of New Mexico, Talk Radio News

Paul Ryan (R-Wis.) said, “The president is proposing to increase our national debt more than all prior 43 presidents combined,” adding $2.3 trillion more “to the national debt in higher deficits” than his own budget office stated.

Ryan said the budget increases taxes and spending. “But what’s so galling about this – we read today the Chinese are talking about a new currency, the Russians are talking about a new currency. We are debasing the value of the American dollar by borrowing way beyond our means,” he said.

“We are consigning our next generation to an inferior standard of living,” Ryan said.

He estimates the national debt will double in six years and triple in ten.

Dan Mitchell, senior fellow at the CATO Institute, a libertarian think tank, said, “That’s just the tip of the iceberg, because … we have trillions and trillions of unfunded liability for entitlement programs, … tens of trillions of dollars of unfunded liabilities in the future. We are in effect on a path to become the next Argentina.”

That other countries would consider a reserve currency other than the dollar is, he says, “a referendum that we are on the wrong track.”

Rep. Jim Jordan (R-Ohio), Chairman of the Fiscal Responsibility Task Force of the Republican Study Committee, said that one of the elements of greatness is the willingness of one generation to sacrifice for the next. The next generation, he said, will never be able to repay this debt.

He quoted Sen. Judd Gregg (R-N.H.) as saying this budget would bankrupt the country.

Rep. Marsha Blackburn (R-Tenn.) said “One of my constituents said it best, ‘I am tired of Congress spending money I haven’t made yet for things I don’t want.’ When you look at the push for nationalizing healthcare, when you look at the cap-and-tax scheme (Cap-and-Trade), this is what people are afraid is going to pile on more and more debt.”

“I look at this as being economic abuse of (her grandchildren’s) future,” she said.

Rep. Gregg Harper (R-Miss.) said, ”When you find out you’ve dug yourself a hole, you should quit digging, but we’ve brought in heavy machinery, and we’re making the hole so deep that we’re not going to be able to get out of it.”

“We tell our children we can’t afford to get everything,” he said, and now the children, the public, are telling the parents, the legislators, “We don’t really have to have that.”