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Morning Bell: A Budget to Save the American Dream

Posted By Mike Brownfield On March 15, 2012 @ 8:49 am In Economics | Comments Disabled

America’s fiscal condition is dauntingly dismal. The national debt is well on its way to $17 trillion, 13 million Americans are out of work, and the country is stuck in the slowest recovery in the post-war era. Despite Washington bleeding taxpayers dry with reckless overspending, the U.S. Senate has not passed a budget since nearly a year before Apple released the original iPad, leaving the country in a lurch, desperate for leadership in Congress that will bring bold changes and an end to the unconscionable pattern of spending and borrowing.

Last spring, America saw a bright spot emerge from the abyss when Budget Committee Chairman Paul Ryan (R-WI) introduced a budget resolution that confronted the twin crises of spending and debt head on. Ryan’s proposal, which passed the House, was a solid step in the right direction — his budget would have gotten spending under control, repealed Obamacare, transformed Medicare, and offered a solid approach to controlling Medicaid’s spiraling costs. Unfortunately, the Senate said “no,” and America watched Washington get stuck in gridlock last summer, only to emerge with a half-baked deal that postponed real reform and put our national security in jeopardy.

In the coming weeks, the budget will again pass through Congress’ orbit, and it will be up to Ryan to steer it in the right direction. The Heritage Foundation’s Vice President for Domestic and Economic Policy, David S. Addington, lays out six conservative goals that Ryan should include in his proposal [1] — a tighter budget that spends less next year than this year; a budget headed toward balance (sooner rather than later); fixes to entitlements that get costs under control; no tax hikes; job-creating pro-growth tax reform; and ensuring a strong national defense:

The Heritage Foundation showed how best to achieve these goals with Saving the American Dream [2]: The Heritage Plan to Fix the Debt, Cut Spending, and Restore Prosperity.

The Heritage plan achieves a balanced federal budget within ten years and keeps it balanced thereafter, without raising taxes. The plan moves Social Security, Medicare, and Medicaid toward the principle of insurance against the risk of poverty and away from the principle of open ended entitlement to government guaranteed income and benefits.

The plan abolishes the individual income tax, capital gains tax, and many other taxes and instead imposes a simplified, single-rate tax on expenditures by individuals–with no taxes on amounts saved–and a single tax on the domestic net cash flow of businesses. The plan also ensures that America has the capabilities it needs to defend our country and its interests around the globe.

With these policies, the Heritage plan achieves a permanently balanced budget and spurs economic growth, investment, and creation of jobs. The Heritage Foundation measures congressional progress toward conservative goals against the standard of Saving the American Dream [2].

Of course, there are those in Washington who stand opposed to these kinds of reforms. Yesterday, faced with the prospect of congressional conservatives’ calls for a budget that spends less, Senate Majority Leader Harry Reid (D-NV) accused Republicans [3] of violating last summer’s agreement. “This wasn’t only a handshake, a pat on the back, it was a law we passed,” Mr. Reid told reporters. “Now the Republican right-wing in the House is trying to change the law.” Meanwhile, Reid and the Senate Democrats have offered no solutions to the problems staring them in the face.

Conservatives are looking for leaders in Congress to recognize the desperate times the country is in and take the necessary steps to put Washington on sound fiscal footing. As Addington writes [1], “The job will not get done with a little budget-trimming here, a few tax changes there, and the annual, never-realized promise that Congress will do better next time, as our national debt of more than $16 trillion continues to mount.” Chairman Ryan and the House of Representatives should now take the lead and propose a budget that gets federal spending and borrowing under control while advancing the conservative principles laid out in the Saving the American Dream [2] plan.

Quick Hits:


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2012/03/15/morning-bell-a-budget-to-save-the-american-dream/

URLs in this post:

[1] lays out six conservative goals that Ryan should include in his proposal: http://www.heritage.org/research/reports/2012/03/federal-budget-control-spending-and-create-jobs

[2] Saving the American Dream: http://savingthedream.org/about-the-plan/

[3] accused Republicans: http://blogs.wsj.com/washwire/2012/03/14/fight-breaks-out-over-2013-budget-cuts/

[4] says one of his top priorities is to reverse $487 billion in cuts to the Pentagon’s budget: http://thehill.com/blogs/defcon-hill/budget-approriations/216125-mckeon-wants-to-stop-sequestrationand-previous-pentagon-budget-cuts

[5] the policy represents a threat to religious freedom of “unprecedented magnitude”: http://www.nationalreview.com/articles/293529/no-compromise-george-weigel

[6] It has been one year since protesters in Syria first took to the streets: http://www.washingtonpost.com/as-violence-in-syria-escalates-a-year-into-uprising-protesters-say-they-wont-give-up/2012/03/14/gIQAGeA2BS_story.html?hpid=z1

[7] suffering tribal violence which left 200 people dead last week: http://www.latimes.com/news/nationworld/world/la-fg-south-sudan-massacres-20120315,0,1298112.story

[8] Read about it on The Foundry.: http://blog.heritage.org/2012/03/14/side-effects-doctors-fear-obamacare/

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