Economy & Budget

The President’s Health Care Tax Deduction initiative proposed during the State of the Union was designed to produce two main results: (1) limit the economic distortions currently present in the tax code with respect to health care, and (2) reduce the number of uninsured in America.

How Does It Work?

The President is seeking to accomplish these two goals by eliminating the exclusion of employer-provided health insurance from income and replace it with a standard tax deduction – $15,000 for family and $7,500 for individual – available to anyone who has health insurance, regardless of the price.

Such a change in the tax code would largely accomplish the first goal. However, introducing a deduction in the income tax system alone would not affect a large fraction of the uninsured who already pay no federal income taxes. Therefore, the President was forced to look at what federal taxes those uninsured actually pay if he wanted to lure them to purchase health insurance from his plan. Read more...

A lot is being made of this being President Bush’s first address to a Democratic-led Congress. I appreciate that President Bush has proven he’ll take a stand and fight for his programs and initiatives. It’s the kind of leadership that makes things happen.

On the specifics, the President’s focus on making America energy independent and less reliant on fossil fuel is good for the nation and good for Iowa. He’s describing a very ambitious agenda. Based on the performance thus far in reaching the renewable fuels standard, his goal of increasing the standard is very realistic. That will benefit agriculture and rural America. Most importantly, though, this goal is necessary. Major goal-setting is the only way we’re going to wean ourselves off of foreign sources of energy.  Tonight’s goal is admirable, but only if it doesn’t come at the expense of existing supportive policies for renewable fuels, such as the ethanol excise tax credit and import tariff. Read more...

More and more I’m convinced that anything we can do to hold down wasteful spending is a good thing. I believe the efforts made already this year with earmark reform and with lobbying reform will promote fiscal responsibility and discourage wasteful spending. Senator DeMint’s amendment was really a way to say to the taxpayers that we’re going to have the most transparent process possible. I think senators need to have a way to direct money to certain projects in their respective states, but that process ought to be a completely open one. It was quite a victory though, to be honest, that we got the Senate lobby reform back to where it should be–the original reform would still have left taxpayers in the dark on 95 percent of earmarks.

Democratic leadership tried to keep DeMint’s amendment from being considered, but in the end we got a strong majority of Republicans and nine Democrats to support increased disclosure. Read more...

President Bush amended Executive Order 12866, which was issued by President Clinton in 1993 as an attempt to get control over the proliferation of rules issued by agencies. In it, he broke new ground in the sense that he reassured a regulatory planning process, cost-benefit analysis, and regulatory impact analysis.

Between 1993 and 2000 it was honored more in the breech, and agencies did whatever they wanted to do. When President Bush came in one of his first acts was to issue an interpretation of 12866, indicating this time it was really going to be enforced—that he was going to put in a new team at OMB and make sure the executive agencies complied with the order. He nominated John Graham, and for five years John made a valiant attempt to get control of the agencies, but the agencies were issuing 40,000 new rules every year.
This time what President Bush did was he amended the executive order to do several things. The first is to require all agencies, before they issue a new rule, to state specifically what market failure occurred that requires the rule and to explain the significant impact of the rule and assess how it will be implemented. Read more...

In the last decade, we've lost more than three million manufacturing jobs and tens of million of other jobs to unfair foreign competition.

Failed U.S. trade policies like NAFTA, the WTO, and preferential trading status for China have led to a ballooning trade deficit, lowered wages and deteriorating working conditions. And, through fast-track and an erosion of oversight, Congress has abdicated its constitutional duty to "regulate commerce with foreign nations."

Congress is in need of independent, nonpartisan, neutral expertise on trade issues. That's why I have introduced legislation creating a Congressional Trade Office (CTO). The CTO would be similar to the Congressional Budget Office, which was created by Congress to provide such expertise on economic and budget decisions and to reduce reliance on the executive branch for insight and analysis. With trade legislation affecting millions of American workers, a neutral source of information is needed in order for Congress to conduct better oversight and to make measured, thoughtful decisions on these issues.

The Department of Labor has reported that applications for jobless benefits totaled a seasonally adjusted 290,000 last week, the lowest level in 11 months, a clear indicator of growing strength of the American economy.  By including relief to small businesses as part of a minimum wage increase, we can work to preserve the strength of America’s economy and create even more jobs.

Small businesses are the backbone of the American economy, and I am pleased that so many of my Senate colleagues recognize the role they play and the need to protect them as we debate a minimum wage bill.  Small businesses employ more than half of all private sector employees and generate 60 to 80 percent of net new jobs annually, so pairing a minimum wage increase with targeted tax and regulatory relief is vital to helping these businesses continue to create new jobs, stay competitive and keep our economy growing.

Last week I introduced the Municipal Deposit Insurance Protection Act to provide additional FDIC coverage so that local governments and schools can keep their deposits within the community.

As you know, deposits are currently insured by the FDIC up to $100,000. In small communities, such as those across my district, municipalities must often choose between fostering economic development by placing their deposits in local banks or receiving guaranteed FDIC coverage through large out-of-state banks, or other complex financial arrangements.

My bill would provide public deposits with greater FDIC protection through a raise in coverage levels. H.R. 382 would authorize FDIC insurance coverage for 80 percent of the deposits beyond the standard level of FDIC coverage up to $2,000,000.

Raising FDIC coverage on municipal deposits is not a new idea as my bill passed the U.S. House in the 107th, 108th, and 109th Congresses. Unfortunately, this commonsense bill never received a vote in the Senate. In my district, I saw firsthand what the lack of adequate FDIC coverage can do when bank fraud cost the municipality and local school district hundreds of thousands of dollars. The lessons learned from inadequate deposit coverage can be cruel and deserve a commonsense fix to protect our communities.

As we witnessed last week, the results of November's elections have culminated on Capitol Hill.  For several of my colleagues, this is their first time in the minority.  As we adapt to our new circumstances - at least temporarily - I am reminded of my 17 years in the South Carolina State Senate - 16 of which were spent in the minority.  I remember the frustrations and the setbacks.  I also remember successes borne of cooperation.  We passed welfare reform.  We restructured the state government.  We produced results.

While Republicans and Democrats have fundamental philosophical differences, we are united in a desire to protect America and create opportunities for our fellow citizens.  Focusing on these similarities, I believe we can work together for the good of our country.

While pledging to work with Democrats on matters benefiting the American people, Republicans will make our case on the issues.  We will promote fiscal responsibility and oppose tax increases.  We will work to secure our borders and deny amnesty to illegal immigrants.  We will advocate for a strong national defense and perseverance in the Global War on Terrorism.  Read more...

As the new 110th Congress begins its work, the Teamsters Union is making sure that workers are the focus. In November, working families demonstrated our strength. Our votes and voices changed the nation’s priorities. Americans decidedly rejected six years of failed policies from the Bush administration.

This is an important year for working Americans. The challenges we face include the lack of affordable health care, growing retirement insecurity, dwindling workplace rights, job-killing trade agreements, unsafe highways and concerns about our national security. Read more...

Representing an industry that will feel the greatest financial impact of a wage hike as one of the nation's largest private sector employers providing jobs to 12.8 million individuals, the National Restaurant Association has concerns about the $2.10 federal minimum wage increase proposal. Without tax offsets (such as those supported by Rep. Howard P. "Buck" McKeon and Rep. Jim McCrery) or other measures to mitigate the negative financial impact a wage hike would have on the nation's 935,000 restaurants and other small businesses, the industry cannot support this bill.

Seventy percent of all restaurants are small businesses, so a minimum wage increase without sufficient targeted offsets will severely impede job creation. The restaurant industry is predicted to create an additional 2 million positions in the next decade, and an increase in the starting wage will hamper that growth. Read more...