Congressman Bill Pascrell

Representing the 9th District of NEW JERSEY

Its Time to Set Real Budget Priorities

Apr 17, 2002

In January of 2001, the first month of the George W. Bush presidency, the non-partisan Congressional Budget Office announced that the federal government would have a budget surplus of $5.6 trillion over the next ten years. One year later, in January of 2002, that surplus number had shrunk an astounding $4 trillion, to $1.6 trillion. Four separate congressional reviews were undertaken to determine where all the money went. Each came to the same conclusion. About 45% of the surplus went to pay the cost of last year's tax cut, one where the benefits were tilted disproportionately to the top 2% of income earners in the United States.

As that tax and budget plan was being debated in February of 2001, President Bush made the following statement in an address to Congress, "We should also prepare for the unexpected.we should approach our nation's budget as any prudent family would." What Congress and the President did was exactly the opposite. A budget was enacted that made politically motivated tax cuts the top priority. Instead of passing a balanced budget that avoided deficit spending, addressed the priorities of Social Security and Medicare, and provided targeted tax relief to those who really need it, "feel good" politics won out. Tax cut fantasy replaced fiscal credibility.

Amazingly, this year some in Washington want to again go down this path of fiscal mismanagement. The House voted recently to make permanent the tax cuts enacted last year, which were set to expire in 2010. As our hard-earned surplus slips away, and as the Social Security Trust Fund is raided of $845 billion over the next decade due in large part to the last tax plan, House Republicans and the Administration believe it "prudent" to take another $374 billion directly from Social Security to pay for more tax cuts. Is it any wonder why the United States does not have a prescription drug plan on the books? It has been sacrificed at the altar of tax cuts.

As we borrow from the Social Security and Medicare surpluses, we are adding to our nation's debt, and doing this at the same time when baby boomers begin to retire and become eligible for Social Security and Medicare. This is not fiscally sound policy.

I have voted to cut taxes by $100 billion over 5 years, eliminate the excise tax on telecommunications services, cut taxes on married couples by $182 billion, ban state and local taxes on internet access, and eliminate the estate tax. I also wrote and fought for local property tax relief in the form of the first ever federal fire safety grant program. Local taxpayers no longer have to be the sole source of funds paying for our local fire departments.

What I do oppose vigorously is shifting dollars earmarked to pay Social Security benefits or Medicare payments to cover the cost of more tax cuts.

Seven times since 1999, the Republicans in the House voted to fully protect the Social Security Trust Fund. Seven times they voted to put Social Security dollars in a "lock-box." It now appears those "lock-boxes" were as reliable as Enron's balance sheet.

These budgetary choices impact people's lives everyday. After three years of budget surpluses, we are back to running deficits, driving up interest rates on car payments, mortgages and student loans. We are back to piling up massive debt for our children and grandchildren, and weakening Social Security and Medicare for beneficiaries today and tomorrow.

Temporary budget deficits may be necessary in times of war and national emergency. But the Administration's recently released budget plan actually allocates more for a second round of tax cuts than it does for defense. The war is not the reason for the current budget mess, and it is utterly irresponsible in light of our current economic situation to compound the mistake of last year's budget by making its tax cuts permanent.

It's time the House Republicans stop talking about strengthening Social Security and Medicare, and do it. It's time we pay down our national debt, and make sure our budget deficit is only created to ensure victory in the war on terrorism. It's time we focus tax relief on those who need it, and those who will spend those dollars strengthening our economy. In short, it's time to craft a budget that reflects our short and long term priorities.