Center for Effective Government | Because government matters

Taxonomy: Term ID

House Ways and Means Keeps Talking Private Accounts

Jun 30, 2005 by Guest Blogger

Yesterday the House Republican Conference met to discuss a Social Security proposal to create private accounts by using the "Social Security surplus." The House Republicans, who could move a bill as early as July, have called the creation of private accounts one of three parts they would hope would be included in reform legislation; the other two parts would address solvency and private pension security issues. House Subcommittee on Social Security Chair Jim McCrery (R-LA) said the legislation would "stop the raid on Social Security.... Every penny of payroll taxes will be paid on Social Security benefits." However, the plans discussed so far do not address solvency and will drain money from other government programs. Ways and Means Ranking Member Charles Rangel (D-NY) called the GOP plan "a scam that doesn't stop their raid on Social Security and starts privatization." House Republicans are also arguing that the GOP bill will increase transparency by exposing the true size of the deficit, since the government won't be able to "borrow" from the surplus anymore to pay down the deficit. In 2004, $155.2 billion of the Social Security surplus was loaned to the government in return for Treasury bonds. Had the government not been able to borrow that money, the deficit would have been $567 billion as opposed to $412 billion (which was a record high as it is). However, if Social Security were simply "on-budget" instead of "off budget," the surplus would not help mask the true size of deficits, because the government wouldn't be able to borrow it in order to pay down the deficit. Therefore, there are other ways of increasing transparency besides the creation of these surplus-funded private accounts.

read in full

Shays-Meehan Reported Out of Cmte

Jun 30, 2005 by Guest Blogger

The House Administration Committee approved legislation June 29 that aims to rein in so-called Section 527 political organizations (H.R. 513). The committee approved the bill with a 5-3 party line vote after approving a substitute amendment by the same vote. The committee reported out the measure without recommendation. The Shays-Meehan legislation, co-sponsored by Reps. Christopher Shays (R-Conn.) and Marty Meehan (D-Mass.) would seek to impose contribution limits on Section 527 groups now claiming exemption from such limits. For more information. (Subscription required)

read in full

Ney Mandates E-Filing of Lobby Reports

Jun 30, 2005 by Guest Blogger

FYI - Rep. Bob Ney, Chairman of the House Committee on House Administration, has instructed the Clerk of the House of Representatives to only accept electronically filed lobbying reports starting in 2006. Chairman Ney also instructed the Clerk to develop an electronic filing system for Representatives to use in filing privately paid travel forms, expenditures for official foreign travel, and contributions in lieu of honoraria. Those systems should be fully deployed by the end of 2005.

read in full

Tax Panel May Reveal Some Details in July

Jun 30, 2005 by Adam Hughes*

The president's advisory commission on tax reform could hold a hearing in mid-July that may offer a more detailed glimpse at the changes the panel will recommend in September, a senior Treasury Department official said June 29 at a tax roundtable sponsored by the District of Columbia Bar Association Tax Section. Also speaking at the roundtable event was the Commissioner of the Internal Revenue Service Mark Everson, who reiterated five points that he believes are significant as the panel works to produce its recommendations. The five points the panel's proposals should reflect include:

the increasinly global nature of many tax transactions
retaining "adequate progressivity"
being administrable
being simple for taxpayers to comply with, and
providing for a smooth transition

For more information on the tax panel's work to date, see OMB Watch's Tax Panel Webpage

read in full

Sinking science at oceans agency

Jun 29, 2005 by Guest Blogger

Politicos are editing or suppressing scientific conclusions about fisheries and marine wildlife, according to a survey of agency scientists conducted by PEER and Union of Concerned Scientists:

read in full

Homeland unsecured: the milk supply

Jun 29, 2005 by Guest Blogger

The National Academy of Sciences published in its journal an article about homeland security and the food supply, after delaying publication at the request of the administration. The article essentially models the likely scenario of a bioterror attack on the food supply via dumping botulinum toxin into a milk silo.

read in full

Smaller Deficit Could Lessen Pressure For Fiscal Discipline

Jun 29, 2005 by Adam Hughes*

Congressional observers and Wall Street analysts have once again projected down the U.S. fiscal deficit for 2005, with some believing the deficit could be almost $100 billion smaller than the White House's initial projection from January of $427 billion. Increased tax receipts and stronger than projected economic growth have contributed to the smaller deficit projection. Through May, receipts have increased 15.5 percent as compared to the same period in 2003, outpacing a 7.1 percent increase on the spending side, and the economy grew at a rate of 3.8 percent in the first quarter of 2005. Yet the lower deficit projection is hardly news for celebrating. Even $325 billion - the low mark for projections - would be the third largest deficit in history (the two others, incidentally, were in 2003 and 2004). And despite the better economic numbers, deficits are projected to remain for decades. The Bush administration has hailed the smaller projections as good news and says it is part of the plan to cut the deficit in half by 2009. What the administration does not say, however, is that after 2009, if current policies stay in place, the deficit will start to rise again. The government is currently running a structural deficit, meaning that no matter how larger our economic growth becomes, the current tax code will not be able to bring in enough revenue to pay for current programs, policies, and priorities. This is due to a lack of a long-term outlook for fiscal planning in the government and lack of discipline among the GOP in Congress to resist yet another round of unpaid-for tax cuts. This trend continues to be troubling.

read in full

Hit list under fire again

Jun 28, 2005 by Guest Blogger

OMB's controversial hit list of regulatory protections to be weakened or eliminated was debated today before the Regulatory Affairs Subcommittee of the House Government Reform Committee. (Read testimony by Public Citizen's Joan Claybrook here.) Although Rep.

read in full

Bank of International Settlements Issues Warnings in Report

Jun 28, 2005 by Guest Blogger

The Bank for International Settlements released their annual report yesterday. In the report (see also a summary), they issued warnings on economic imbalances, the U.S. budget deficit, and dollar depreciation. The report found that the world economy is marked by increasing internal and external economic imbalances. These imbalances raise serious questions about future global growth and financial stability. The report said, "One simply cannot ignore the number of indicators that are now simultaneously exhibiting marked deviations from historical norms," and went on to warn that the U.S. budget deficit was an increasing concern of global importance. The report basically stated that without any sort of budgetary discipline, the continued decline of the U.S. dollar against other currencies appeared "inevitable." The report also stated that the U.S. deficit "expanded to a record high as a proportion of GDP [almost 6%], and this in spite of a reduction in the effective real value of the dollar of more than 20% from its peak in early 2002.... It is unprecedented for a reserve currency country to have a current account deficit of such magnitude." The high deficit has resulted in the global financial system seemingly becoming increasingly prone to various sorts of financial turbulence. The Bank of International Settlements is warning Bush and Congress that if deficits continue to rise, there could be serious consequences. Given the current fiscal health of the U.S. economy, now is not the time for Congress and the President to be considering any extremely expensive legislation, without figuring out a way to pay for it.

read in full