Economy & Budget

A case for earmarks

Earmarks are evil, right? Do you remember “the bridge to nowhere;” the “Cowgirl Hall of Fame,” the “Museum of Corn;” or road improvements on the private land of Supporters? These are extreme examples of targeted federal spending—Congressional earmarks—have given the practice a very bad name. Indeed, the public has taken note as well at the members of Congress elected under the Tea Party banner. At the start of the 112th Congress, the House and Senate banned the practice of earmarking the appropriations bills.

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Washington has a spending problem, Not a revenue problem

It will be the end of the world as we know it if the federal government does not reform its fiscal ways, according to the Congressional Budget Office’s recent Long-Term Budget Outlook. The results from this year’s report, particularly the extended alternative fiscal scenario, are even worse than last year’s.  The alternative fiscal scenario projects non-interest expenditures to reach 26.1% of GDP in 2037. This surpasses last year’s gloomy outlook in which CBO projected expenditures to reach 25.0% of GDP in 2035. Historically, non-interest expenditures have averaged about 19%. Alarmingly, CBO projects debt held by the public, which excludes trust fund debt like Social Security, will be 199% of GDP in 2037, up from 69% in 2011.

The explosive increase in spending is driven primarily by growth in the Big Three entitlements: Social Security, Medicare, and Medicaid. In 2012, these three entitlement programs cost 10.4% of GDP. CBO projects these costs to increase to 12.9% of GDP in 2022 and 16.6% of GDP in 2037. CBO is actually projecting “other” spending – which is everything but these three programs --to decrease from 11.6% of GDP in 2012 to 9.6% of GDP in 2037. In the alternative fiscal scenario, CBO assumes that budget caps from last year’s Budget Control Act, which largely exempted entitlements, will be enforced but sequestration will not.

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A bipartisan solution to aid America's low-income communities

The lower-than-expected May jobs numbers released last week are further proof that the magnitude of our nation’s economic problems defies traditional solutions. Too many Americans are unemployed and too many communities are hard-pressed to maintain the jobs they have, much less offer new opportunities. Even our most respected economists can’t agree on the solutions that will revitalize our country.

We think our nation’s great economic minds could learn a great deal by putting down their statistical analyses and taking a walk through economically distressed areas in Reading Pennsylvania and Holyoke, Massachusetts that have seen the benefits of NMTC. In Reading, an NMTC investment created jobs and opportunity in a Quaker Maid Meats family owned meat processing business. In Holyoke, the Green High Performance Computing Center is paving the way for new jobs. These aren’t just successful businesses; they are answers to many of our economic challenges.

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In favor of zero-based budgeting

Imagine sitting at your kitchen table or in your study planning out your family’s annual budget. You don’t really know what all your expenditures will be.  In fact, you’re not exactly sure if you need some of the things you normally budget for or actually used all of what you bought last year. Just in case, though, you add in all these costs to this year’s budget anyway. Oh, and that car and refrigerator you purchased last year gets lumped  into this year’s overall spending as well. 

Of course, this is a ridiculous approach to financial planning. Nobody in their right mind budgets this way. Unless, that is, you are the federal government.

Unlike most hardworking American families who each year account for every incoming and outgoing dollar, the federal government assumes ongoing expenditures and rolls them over from year to year. Through a process known as incremental budgeting, existing government programs perpetuate from one year to the next simply because they were there the year before, with their need and effectiveness seldom analyzed and underlying assumptions rarely questioned.

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Rise in unemployment and debt is troubling

Last week’s jobs report showed a concerning rise in unemployment to 8.2 percent in the month of May. There are many factors interfering with our nation’s recovery. I believe high unemployment and our inability to see a true recovery is directly related to uncertainty due to bad policies such as the health care law and Congress’ inability to gets our country’s fiscal house in order.
 
I participated in a “Pen and Pad” event on Tuesday with fellow Representatives Price (R-Ga.) and Lankford (R-Okla.) regarding 40 consecutive months of unemployment at or above 8 percent. This has been one of the weakest recoveries on record. High unemployment figures are another reminder that Congress needs to focus on creating an atmosphere where businesses can thrive.

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Rescuing a critical missile defense system from Pentagon bureaucracy

Albert Einstein once said, “Bureaucracy is the death of all work.” Validation of those prescient words can be found in the Pentagon’s handing of a missile defense system that performs and is primed for fielding; the Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System (JLENS). It is the latest in cruise missile defense technology and fills a vital military need.
 
As a combat officer in Iraq and Afghanistan, I know first hand the importance of America's technological advantage. Technology like this levels the playing field and allows our troops to deal with threats, known and unknown. Not only can it protect battle space in Afghanistan and other theaters, JLENS is capable of over-watching strategic geography like the Korean Peninsula, the Strait of Hormuz and elsewhere. Future threats are difficult to predict and technologies like JLENS helps America set the terms of future engagements. But JLENS also demands the attention of taxpayers and those concerned with our budget crisis and debt burden.

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A lame-duck Congress can make a difference

We are facing a fiscal cliff at the end of this year. And everyone from the presidential candidates to the most junior Congressional staffer realizes that how we address this challenge will have an enormous impact on our economy in both the short term and over time. If we allow all the tax cuts to expire, and the automatic across the board cuts to take place as scheduled on January 1, 2013, the result will be sending our economy back into recession. While some, including Speaker Boehner, are wisely pushing to begin negotiations, it’s virtually certain that Congress won’t reach any significant agreement about our structural debt challenges until after the election.

However, there is some hope that a lame duck Congress can make a difference.

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In lean times, the Pentagon must only finance vital programs



Modern military fighters carry incredible radars, but every so often, older
fighters require radar upgrades. Specifically, they need "X-band active
electronically scanned array" radars built around "gallium arsenide" chips.



Is that a mouthful?  Well, they're called "AESA" radars for short. And the
 Pentagon is getting ready to buy a few billion dollars worth of them.



Basically, an AESA radar is a grouping of many thumb-sized transmitter and
receiver modules -- as opposed to a big mechanical dish antenna. Radar
experts generally consider AESA the biggest improvement in this field of
technology since combat radar was first invented by the British during World
War II.



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The fiscal train wreck(s) awaiting us unless Congress acts

In Texas, there’s an old saying that goes like this. A train signalman sees that two trains heading towards each other, one from the north and one from the south, on the same track. If he doesn’t stop the trains, it will be a huge wreck. So what does he do?  He runs and tells his Uncle Leo to come watch, because Leo has never seen a train wreck before.
 
As a former Congressman, I have seen my share of potential train wrecks. I have experienced the midnight votes, all-night debates, and the last minute compromise to pass legislation that is vital for the American consumer and economy. But never before have I seen such a catastrophic number of train wrecks scheduled to happen at the same time.

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100 years on - Low wages continue to impoverish many

Low-wage work is nothing new -- but, as we arrive on the 100 year anniversary of the first minimum wage law passed in the United States, we must recognize an even more dispiriting fact about the low-wage workforce: It could have been a thing of the past.
 
The first minimum wage law in the United States was established on June 4, 1912 in Massachusetts. More than a dozen states would follow over the subsequent 10 years, and by 1933 the new U.S. Secretary of Labor, Frances Perkins, wrote an essay to make the case for a federal minimum wage.
 
Reading Perkins’ essay today reminds us of the potential that minimum wage laws hold for shaping a fair and productive economy.

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