Morning Action: Conservatives Weigh in on Debt Limit Debate
DEBT LIMIT. In light of the approaching debt limit debate – and in light of our nation’s massive spending problem and weakened economy — conservatives have given Congress guidelines as to how to approach this issue. Heritage Action CEO Mike Needham and other top conservative leaders have sent an open letter to Congress, calling on them to put the federal budget on a path to 10-year balance:
In the coming months, you will face tremendous pressure to accept a deal to raise our nation’s debt ceiling. Conservatives around the country will insist the debt ceiling not be raised unless our nation gets on a path to a balanced budget within 10 years and stays balanced. This is not an arbitrary marker; rather, it is the marker laid out by the entire House Republican Conference in what has become known as the Williamsburg Accord.
Conservatives cannot enter into the debt ceiling debate without understanding the promise of the Williamsburg Accord.
On January 18, four current and former chairmen of the Republican Study Committee announced an agreement to re-sequence the 2013 fiscal fights. In exchange for holding the line on the sequester and producing a budget that balanced in ten years, conservatives agreed to postpone the debt ceiling debate for several months. In turn, the debate on the debt ceiling would revolve around enacting the policies that put the federal budget on the path to 10-year balance.
The Heritage Foundation has also stated clearly that the debt limit debate should not be linked to tax reform. Though both are important issues, they ought not be considered together:
Press reports link the coming debt limit debate with the building effort for tax reform. The debt limit and tax reform are both important, but the connection ends there, as it should. Suggestions that some sort of fast-track procedure for tax reform might be the conservative “ask” in exchange for a debt limit increase are way off base.
The debt limit debate is precipitated by ongoing massive deficit spending and the calendar. Tax reform, meanwhile, is precipitated by the need to compensate for President Obama’s economic policies’ failure to launch a robust recovery and to correct a tax system increasingly inconsistent with the dictates of a globally competitive economy.
After May 19 the Treasury will then turn to its usual toolbox of extraordinary measures, now believed sufficient to carry the government certainly through July and quite possibly into the fall. Whatever the time frame, another debate is unfolding as to whether and how to raise the debt limit, by how much, and on what terms.
It is in this context that the debt limit and tax reform have been linked. That link should be broken and never repaired.
IST. The internet sales tax bill was passed in the Senate (sub. req’d), while lawmakers who were the proponents of the bill turned a blind eye to the economic detriments and other burdens this bill will cause:
The Senate on Monday passed legislation that would let states require online retailers outside their borders to collect their sales taxes.
After adopting a manager’s amendment to address objections to the measure and quell House opposition, the chamber passed the bill 69-27.
“This bill is about fairness,” said Wyoming Republican Michael B. Enzi, the sponsor of the measure.
Lawmakers supporting the bill (S 743) have argued that small businesses and brick-and-mortar stores are at a competitive disadvantage with online retailers, many of which do not have to collect sales taxes. Proponents say the situation has caused financially struggling states and localities to lose out on billions of dollars in uncollected revenue. The measure would simply enable the collection of taxes that are already due, they say.
Opponents in the Senate — most vocally lawmakers from Montana, New Hampshire and Oregon, which do not have a sales tax — have countered that the measure would be burdensome for small businesses, which would have to comply with state and local tax laws from around the nation. They argue that the measure would violate state sovereignty, force businesses to be tax collectors for other states without benefitting them, and harm small online businesses.
The House of Represenatives will approach it more slowly and with more discretion, where conservative voices have a strong impact (sub. req’d):
Despite a healthy Senate vote of 69-27 to pass an Internet sales tax bill Monday, House leaders remain hesitant to rush the process there, with the depth of opposition still unclear.
Influential conservative Sen. Ted Cruz, R-Texas, penned a scathing op-ed for Real Clear Politics on Sunday, calling the bill “a national Internet sales tax, which would hammer the little guy and benefit giant corporations.”
That, and opposition from tea party groups, could drum up opposition among Republicans in the House, particularly those aligned with the Republican Study Committee. That group has not taken an official stance on the bill yet.
AMNESTY. The new Heritage Foundation study on the cost of amnesty has already come under attack. The $6.3 trillion price tag for amnesty is not a convenient reality for the left and for proponents of the Gang of Eight’s bill. However, Jim DeMint explains that this cost is simply not a burden that American taxpayers should have to bear:
As Heritage President Jim DeMint put it yesterday, “Any immigration reform should improve the lives, the incomes, and the opportunities” of those who are lawfully in America.
The Gang of Eight’s amnesty proposal does the opposite by burdening taxpayers with supporting unlawful immigrants. The Heritage Foundation’s new report estimates that an amnesty like the Gang of Eight’s bill would cost U.S. taxpayers $6.3 trillion.
“We’re advocating on behalf of those who have come here lawfully and all American taxpayers—this is going to be a huge cost to them, and it will diminish opportunities in the future,” DeMint said on “Your World with Neil Cavuto” yesterday.