WASHINGTON, Feb. 27 /PRNewswire-USNewswire/ -- The following is a statement by Robert Greenstein, Executive Director of the Center on Budget and Policy Priorities:
The President's budget represents a bold and courageous proposal to make progress in restoring fiscal discipline while addressing two central problems of our time -- a broken health care system and the threat of catastrophic global warming -- and other national needs.
Particularly courageous are several proposals that take on vested interests to fully pay for the costs of health care reform and tackling global warming, including:
The budget also makes a significant commitment to restoring fiscal responsibility while meeting high priority national needs, by:
By themselves, these budget proposals would prove insufficient to keep deficits at 3 percent of GDP indefinitely. Policymakers will need to take additional steps in subsequent years, as President Obama noted at his "fiscal summit" on Monday.
The budget also deserves high marks for transparency and honesty. Gone are the gimmicks that have been an annual feature of both Presidential and Congressional budgets, under which policymakers pretended to reduce deficits markedly over time by omitting costs in the "out years" for operations in Iraq and Afghanistan, natural disasters, and continued relief from the Alternative Minimum Tax and the scheduled reductions in Medicare fees for doctors -- and by printing in the budget numbers for the costs of discretionary programs in the out years that everyone knew were unrealistically low.
Those gimmicks, sleights-of-hand, and convenient omissions are absent from this budget. Its greater realism and transparency makes the President's pledge to cut the deficit in half in four years a meaningful one; we will now know each year whether we are on course to meet that goal.
The budget also provides needed investments in key areas for long-term economic growth, such as energy efficiency and early childhood education. And it proposes savings from lower priority programs such as bloated agricultural subsidies and from unwarranted tax breaks, such as one that millionaire equity fund managers have exploited to pay taxes at lower rates than many middle-income families and others that benefit oil companies. The budget also follows in the tradition of the 1990 and 1993 deficit-reduction laws in both shrinking the deficit and reducing poverty, which is higher in the United States than in other Western nations.
Predictable but Unfounded Criticisms
The budget already is facing several lines of attack that rest on inaccurate or misleading charges. Chief among them is the claim that the tax increases for people who make over $250,000 will seriously injure small businesses.
In fact, small businesses would win under this budget. Tax Policy Center data show that fewer than one in every ten people with small business income have incomes over $250,000, the only group that faces higher taxes under this budget. Moreover, many people with small business income who are in this category are wealthy individuals who have invested in businesses, but who are not proprietors and have little or nothing to do with running those businesses. The vast majority of small business owners are middle-income individuals who would receive tax cuts under the budget; many of them would also benefit from its universal coverage and health care cost containment reforms.
To be sure, many will oppose various proposals to close tax loopholes, the Medicare and agricultural subsidy reforms, and the cap on the value of itemized deductions for the most affluent Americans -- while saying that they, too, favor universal health coverage, curbing global warming, improvements in education, and the like. This budget challenges them to propose their own ways to finance such measures.
This statement can be found on the Center's web site at: www.cbpp.org.
The Center on Budget and Policy Priorities is a nonprofit, nonpartisan research organization and policy institute that conducts research and analysis on a range of government policies and programs. It is supported primarily by foundation grants.
|SOURCE Center on Budget and Policy Priorities|
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