Blog: The Fine Print / Revenue & Spending

Frist Adds ET Repeal Amendment to Energy Bill

Jun 16, 2005 by Guest Blogger

From today's TaxAnalysts: An amendment proposing permanent repeal of the estate tax has been added to an energy bill - the Energy Policy Tax Incentives Act - going to the Senate Finance Committee today, June 16, for markup. The amendment was one of five added by Senate Majority Leader William Frist (R-TN) to the $16 billion energy tax title including 56 total amendments. Although many of the amendments will be withdrawn and others added before reaching the Senate floor, some suspect that Senator Frist will keep the estate tax amendment to obligate Democrats to vote on the contentious issue. Before becoming law, the amendment would have to be approved by the Finance Committee and full Senate as well as survive conference negotiations with the House of Representatives.

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Social Security and Pension Hearings

Jun 15, 2005 by Guest Blogger

A number of important hearings have taken place this week. Yesterday, the House Ways and Means subcommittee on Social Security held a hearing examining the impact of the American population’s increasing longevity on Social Security’s finances and exploring ways to encourage work at older ages. Members of the panel heard a range of proposals to address the impact of longer-living individuals on solvency. Witness testimonies can be read here. Also, this morning the Senate Budget committee held a hearing on the solvency of the Pension Benefit Guaranty Corp., which we wrote about in our last issue of the Watcher. The committee heard from Bradley Belt, Director of the PBGC, and CBO head Douglas Holtz-Eakin. The hearing was held because it is clear the defined-pension benefit system needs to be reformed. Rep. Boehner has offered a bill (HR 2830) to overhaul the pension system; however his bill has been criticized by both Republicans and Democrats. Boehner's bill raises pension insurance premiums that companies pay from $19 to $30 to ensure that the PBGC does not need a taxpayer bailout.

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DeLay Announces Delays in Budget Process Reform

Jun 14, 2005 by Adam Hughes*

House Majority Leader DeLay today said floor consideration of the budget process bill spearheaded by Rep. Jeb Hensarling (R-TX), and other conservatives has been delayed. "We've been put back just a little bit because we've asked a lot of the Appropriations Committee and a lot of [Appropriations] Chairman Lewis," DeLay told reporters today. "He's a vital part of budget process reform, and he's asked us to sort of give him a leave of absence until he gets all 11 appropriations bills done." Lewis has said repeatedly he will have all 13 appropriations bills finished by the July 4 recess in three weeks. Hensarling's bill would give the budget the force of law, as well as eliminate the practice of emergency spending bills, limit entitlement spending, and establish a committee to study waste, fraud, and abuse. DeLay said he was hopeful they could introduce a bill before the August break, but did not elaborate on a deadline. Read the latest Watcher article on these proposed budget process reforms.

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Watcher: June 14, 2005

Jun 14, 2005 by Guest Blogger

Federal Budget
  • House Conservatives Coopt Delay into Pushing Dangerous Budget Process Reforms
  • Erosion of Retirement Security Continues in America
  • Horrific and Costly Legislation to Repeal the Alternative Minimum Tax Introduced
  • Tax Cuts Often Slide Through Congress Undetected

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Senate Hearing Today on Govt. Accountability and Results

Jun 14, 2005 by Adam Hughes*

Today at 2:00 pm in Dirksen 562, there is a hearing before the Committee on Homeland Security and Government Affairs regarding accountability and results in federal budgeting. The hearing will focus on the specific metrics and tools (e.g., the Program Assessment Rating Tool, or PART) used by the OMB to determine the effectiveness of federal programs, the advantages and disadvantages of using these metrics, and how information provided by these metrics is being used to increase effectiveness and accountability in federal budgeting. Witnesses include GAO Comptroller David Walker, OMB Deputy Director Clay Johnson III, Research Fellow on government accountability issues Eileen Norcross, and Professor of Government and Public Administration at the University of Baltimore Dr. Beryl Radin. OMB Watch recently wrote an op-ed on PART, the President's tool for managing federally funded programs. The op-ed finds that FY 2006 budget cuts were made based on ideology?not on a measured, objective system of program evaluation.

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Smith and Conrad Unveil Retirement Savings Bill

Jun 10, 2005 by Guest Blogger

Sens. Gordon Smith (R-OR) and Kent Conrad (D-ND) announced yesterday their plans to introduce a Retirement Savings and Security Act, which they could unveil as early as next week. The purpose of the bill is to promote automatic enrollment of workers into company 401(k) plans, in order to minimize the risk of future generations outliving their retirement income. The bill could possibly produce 5.5 million new 401(k) participants over the next five years. The bill would also make changes to the saver's credit, a tax credit for low- and moderate-income workers who contribute to retirement plans and IRAs created under the Economic Growth and Tax Relief Reconciliation Act of 2001. Conrad said, "We think this can and will be passed this year."

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Senate 302(b) Allocations; Defense Allocations Lower

Jun 10, 2005 by Guest Blogger

Yesterday the Senate Appropriations Committee approved allocations for the FY 2006 spending bills. The committee is hoping to finish work on all bills by September 30, and avoid a year end omnibus. A total of $842 billion in discretionary funds was allocated to the 12 subcommittees. The allocations, which were prepared by committee chairman Thad Cochran (R-MS), differ from the levels requested by President Bush, as well as the spending plans developed by the House. In particular, the plan calls for moving billions from the Defense side of the ledger to domestic programs, which are slated for deep cuts in the president's budget. According to the committee, the allocations for the 12 bills will be as follows:
  • Agriculture at $17.3 billion, up from Bush's $16.9 billion;
  • Commerce-Justice-State at $48.6 billion, up from Bush's $47.3 billion;
  • Defense at $400.7 billion, down from Bush's $407.7 billion;
  • District of Columbia at $593 million, up from Bush's $573 million;
  • Energy and Water at $31.2 billion, up from Bush's $29.7 billion;
  • Homeland Security at $30.8 billion, up from Bush's $29.6 billion;
  • Interior at $26.2 billion, up from Bush's $25.7 billion;
  • Labor and Health and Human Services at $141.3 billion, the same level as Bush proposed;
  • Legislative Branch at $3.9 billion, down from Bush's $4 billion;
  • Military Construction/Veterans Affairs at $44.4 billion, up from Bush's $43.1 billion;
  • State-Foreign Operations at $31.7 billion, down from Bush's $32.7 billion; and
  • Transportation-Treasury-HUD at $65.4 billion, up from Bush's $63.1 billion.

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    Senate Finance No Closer to Consensus on SS Reform

    Jun 10, 2005 by Adam Hughes*

    Republican members of the Senate Finance Committee met yesterday to discuss options to reform Social Security and achieve solvency for the program. Chairman Chuck Grassley (R-IA) said a number of options were discussed during the meeting (including gradually increasing the retirement age and reducing benefits for high-income seniors), but that he was holding off on pushing only private carve-out accounts - a non-solution favored by President Bush - because of lack of consensus on the policy. Democrats were not involved in the meeting, with Grassley saying he needs to achieve consensus among Republicans before talking with Democrats and also because of the Democrats unwillingness to discuss private accounts created from taking a portion of payroll taxes away from Social Security. One of the most vocal critics of the private accounts, Senator Olympia Snowe (R-ME) applauded the chairman's efforts but added she thought the process should begin in a bipartisan way and be deliberate despite President Bush's call for legislation by the end of this year.

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    Another Critic of Bush's SS Plan Comes Forward

    Jun 9, 2005 by Guest Blogger

    Rep. Jim Gerlach (R-PA) has joined the long list of Republican opponents to President Bush's plan to reform Social Security. In a letter to Pennsylvanians United, Gerlach stated, "I am opposed to the President's PRA proposal and my focus is on finding other ways to [resolve the unfunded liability]." (more info here). Despite continuous opposition, Congressional GOP leaders seem bent on pushing legislation through. Tom DeLay (R-TX) said yesterday that Democrats "are obviously playing politics. They have decided that they're not going to participate and that creates a very difficult approach to getting the bill done." It is obviously not Democrats alone who are refusing to participate in discussions for reforms which include private accounts.

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    House and Senate Timelines for SS Legislation

    Jun 9, 2005 by Adam Hughes*

    Both the House and Senate are moving closer to crafting legislation for Social Security reform. Senate Republicans are hoping to move Social Security legislation through the Senate Finance Committee before Congress recesses for the Independence Day holiday in three weeks. The House has continued to hold weekly hearings on Social Security reform and believes it will mark up legislation shortly after the July 4 recess. Republican members of the Senate Finance Committee have been holding weekly meetings on Mondays to discuss policy options, and a Senate GOP Social Security task force has been holding weekly meetings on Wednesdays. The task force includes leadership Republicans, members of the Finance panel, and other lawmakers. White House aides also have been involved in the task force meetings. It is still unclear if the Finance committee bill will include payroll-financed private investment accounts since Chairman Grassley (R-IA) is unclear if enough panel members support such a provision. On the House side, hearings have continued about one per week over the last month, the most recent scheduled for today, June 9. The hearing will focus on two benefit adjustment provisions in current law, the government pension offset and the windfall elimination provision. The two provisions affect Social Security benefits paid to federal, state, and local government employees who contribute to a government pension plan instead of Social Security.

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