Well, it appears that our efforts are paying off.  Responding to our charge that the GOP was violating the pledge against bundled megabills, Boehner announced that he will split the proposal into three separate bills; the highway bill (HR 7), pension reform (HR 3813), and expanded oil and gas drilling (HR 3408).  This from Roll Call:

In a joint statement with Rules Chairman David Dreier (Calif.), the Ohio Republican sought to cast the decision as part of his pledge for a more open environment in the House.

“Republicans pledged to pass bills in a more transparent manner and reverse the era of quickly moving massive bills across the floor without proper examination. Accordingly, the energy/infrastructure jobs plan will be considered on the floor in the same manner in which it was written and voted upon in committee — in separate pieces,” Boehner and Dreier said.

Such a process will allow “each major component of the plan to be debated and amended more openly, rather than as a single ‘comprehensive’ bill with limited debate and limited opportunity for amendment,” they added.

This is great news.  But here’s the catch (via CQ subscription):

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Well, it appears that our efforts are paying off.  Responding to our charge that the GOP was violating the pledge against bundled megabills, Boehner announced that he will split the proposal into three separate bills; the highway bill (HR 7), pension reform (HR 3813), and expanded oil and gas drilling (HR 3408).  This from Roll Call:

In a joint statement with Rules Chairman David Dreier (Calif.), the Ohio Republican sought to cast the decision as part of his pledge for a more open environment in the House.

“Republicans pledged to pass bills in a more transparent manner and reverse the era of quickly moving massive bills across the floor without proper examination. Accordingly, the energy/infrastructure jobs plan will be considered on the floor in the same manner in which it was written and voted upon in committee — in separate pieces,” Boehner and Dreier said.

Such a process will allow “each major component of the plan to be debated and amended more openly, rather than as a single ‘comprehensive’ bill with limited debate and limited opportunity for amendment,” they added.

This is great news.  But here’s the catch (via CQ subscription):

Read More →

We all agree that a temporary payroll tax cut without permanently restructuring Social Security, along with its funding source, is a ludicrous idea.  Sadly, Democrats would rather play politics by introducing this inane stimulus measure, in an attempt to get Republicans to vote against a tax cut.

For far too long, the extension of the payroll tax cut was coupled with more entitlement spending, in the form of 99 weeks of unemployment benefits and extension of Medicare ‘doc fix.’  We have long advocated that Republicans should decouple the tax cut from the spending in order to preclude a situation where conservatives, who oppose more entitlement spending, would be forced to vote against a tax cut.  Today, House Republicans announced that they will decouple the two issues and pass a clean payroll tax cut extension until the end of the year.  They are leaving out the entitlement spending extensions and daring Senate Democrats to oppose their clean tax cut – one that they have “championed” for the past few months.

Going forward, Republicans must stand strong against pressure to slip the entitlement spending into the payroll tax cut deal.  Once they are free from the burden of shooting the hostage (the tax cut), they should negotiate hard for the rest of the package.  They should be guided by the following principles:

Read More →

We all agree that a temporary payroll tax cut without permanently restructuring Social Security, along with its funding source, is a ludicrous idea.  Sadly, Democrats would rather play politics by introducing this inane stimulus measure, in an attempt to get Republicans to vote against a tax cut.

For far too long, the extension of the payroll tax cut was coupled with more entitlement spending, in the form of 99 weeks of unemployment benefits and extension of Medicare ‘doc fix.’  We have long advocated that Republicans should decouple the tax cut from the spending in order to preclude a situation where conservatives, who oppose more entitlement spending, would be forced to vote against a tax cut.  Today, House Republicans announced that they will decouple the two issues and pass a clean payroll tax cut extension until the end of the year.  They are leaving out the entitlement spending extensions and daring Senate Democrats to oppose their clean tax cut – one that they have “championed” for the past few months.

Going forward, Republicans must stand strong against pressure to slip the entitlement spending into the payroll tax cut deal.  Once they are free from the burden of shooting the hostage (the tax cut), they should negotiate hard for the rest of the package.  They should be guided by the following principles:

Read More →

Throughout the week, Republicans have expressed their shock and dismay that we would have the unbridled temerity to oppose a highway bill.  They want to know why we are suddenly opposed to such basic things as transportation bills, even ones that will leave us with a $70 billion budget shortfall.  They are impugning our motives, charging us with opposing everything that emanates from leadership.

Well, once upon a time, it wasn’t just conservative outsiders who supported the notion that we peg transportation spending to the level of gas tax revenue.  In fact, just last July, members of the T and I Committee, led by Chairman John Mica, introduced a bill that would do just that.  They drafted a plan for a 6-year reauthorization bill that would cost $230 billion, roughly commensurate to the gas tax revenue over that same period.  At the time, we heaped accolades upon that bill.  On July 18, I wrote the following in these pages:

“As a new spirit of fiscal discipline slowly seeps into Washington, John Mica, Chairman of the House Transportation Committee, has drafted the framework for a new highway bill that will cap the funding for highway and transportation projects to the amount of revenue supplied by the gas tax and other highway user fees.”

In fact, it wasn’t just conservative outsiders who stressed the importance of maintaining the integrity of the highway trust fund as a pay-as-you-go system.  The draft proposal from the T and I Committee made that the selling point of their legislation.  It appears that the document has been removed from the committee’s website (the link in the aforementioned quote is defunct), but I still have the pdf from the time I wrote the article.  It reads like this:

Read More →

Throughout the week, Republicans have expressed their shock and dismay that we would have the unbridled temerity to oppose a highway bill.  They want to know why we are suddenly opposed to such basic things as transportation bills, even ones that will leave us with a $70 billion budget shortfall.  They are impugning our motives, charging us with opposing everything that emanates from leadership.

Well, once upon a time, it wasn’t just conservative outsiders who supported the notion that we peg transportation spending to the level of gas tax revenue.  In fact, just last July, members of the T and I Committee, led by Chairman John Mica, introduced a bill that would do just that.  They drafted a plan for a 6-year reauthorization bill that would cost $230 billion, roughly commensurate to the gas tax revenue over that same period.  At the time, we heaped accolades upon that bill.  On July 18, I wrote the following in these pages:

“As a new spirit of fiscal discipline slowly seeps into Washington, John Mica, Chairman of the House Transportation Committee, has drafted the framework for a new highway bill that will cap the funding for highway and transportation projects to the amount of revenue supplied by the gas tax and other highway user fees.”

In fact, it wasn’t just conservative outsiders who stressed the importance of maintaining the integrity of the highway trust fund as a pay-as-you-go system.  The draft proposal from the T and I Committee made that the selling point of their legislation.  It appears that the document has been removed from the committee’s website (the link in the aforementioned quote is defunct), but I still have the pdf from the time I wrote the article.  It reads like this:

Read More →

We’ve directed a lot of attention to the deficiencies of the House version of the highway bill (here and here).  We must also work to defeat the Senate version, which is even worse.  The 2-year $109 billion Senate bill (S.1813) offers no reform to mass transit and continues to mandate that states use 10% of their funding for wasteful “enhancement projects.”  As bad as the House bill is for conservatives, the Senate bill is absolutely indefensible.  Yet, amazingly, it was reported out of the Senate Environment and Public Works Committee with unanimous support from Republican members last year.  Last night, it was approved by the Finance Committee.

The Senate bill will spawn even larger deficits in the long-run.  Even for the two-year authorization period of the bill, there will be a $35 billion deficit between trust fund outlays and gas tax revenue.  Both the House and Senate versions rely on drawing down all existing funds in the trust fund to cover some of the gap ( to the extent that those funds really exist outside of an accounting gimmick).  However, there will still be a $13 billion shortfall over the next two years (and much more in the long-term).  The House bill relies on new royalties from oil exploration (that will never be approved by Democrats), but the Senate bill relies on phantom savings (from revenues that are already used to offset other expenditures) plus…you guessed it; tax increases.

After the EPW committee approved the underlying provisions of the bill, the Senate Finance Committee voted last night to approve $7 billion in sundry tax increases to fund this terrible bill.  One of those provisions includes a tax hike on inherited “stretched” IRAs and 401(k)s.

Here are the details from the horse’s mouth (Baucus Chairman’s Mark).

Read More →

We’ve directed a lot of attention to the deficiencies of the House version of the highway bill (here and here).  We must also work to defeat the Senate version, which is even worse.  The 2-year $109 billion Senate bill (S.1813) offers no reform to mass transit and continues to mandate that states use 10% of their funding for wasteful “enhancement projects.”  As bad as the House bill is for conservatives, the Senate bill is absolutely indefensible.  Yet, amazingly, it was reported out of the Senate Environment and Public Works Committee with unanimous support from Republican members last year.  Last night, it was approved by the Finance Committee.

The Senate bill will spawn even larger deficits in the long-run.  Even for the two-year authorization period of the bill, there will be a $35 billion deficit between trust fund outlays and gas tax revenue.  Both the House and Senate versions rely on drawing down all existing funds in the trust fund to cover some of the gap ( to the extent that those funds really exist outside of an accounting gimmick).  However, there will still be a $13 billion shortfall over the next two years (and much more in the long-term).  The House bill relies on new royalties from oil exploration (that will never be approved by Democrats), but the Senate bill relies on phantom savings (from revenues that are already used to offset other expenditures) plus…you guessed it; tax increases.

After the EPW committee approved the underlying provisions of the bill, the Senate Finance Committee voted last night to approve $7 billion in sundry tax increases to fund this terrible bill.  One of those provisions includes a tax hike on inherited “stretched” IRAs and 401(k)s.

Here are the details from the horse’s mouth (Baucus Chairman’s Mark).

Read More →

Last week, several House committees favorably reported the $260 billion 5-year House GOP highway bill to the full body.  This 846-page behemoth is now headed to a floor vote sometime next week.  Simply put, conservatives oppose the House leadership’s highway bill (H.R. 7) because it continues the failed top-down federal approach to transportation spending, while precluding devolution to the states for at least another five years.  Moreover, it eschews the pay-as-you-go funding mechanism of the Highway Trust Fund (eerily similar to the Social Security Trust Fund!) by permanently authorizing a higher level of spending than the fund’s corresponding revenue source; the federal gas tax.

Nevertheless, let’s disregard the policy concerns for a moment and focus on the political argument.  Just as they did with the budget battles of 2011, GOP leadership is selling this bill as the best alternative, a virtuous improvement of past policies.  And undoubtedly, on paper, the version that will be presented to conservative House members (as opposed to the final version after they cave) contains many good provisions:

• It eliminates the mandate requiring states spend 10% of their transportation funds on transportation enhancements and bike lanes.
• No earmarks. Dozens of old and/or redundant programs are eliminated.
• While it continues to fund Mass Transit to the tune of $8.4 billion annually, this legislation bars gas tax revenue from being diverted in order to support public transportation. [Although, in fine print, the legislation will still fund public transportation projects with a one-time $40 billion appropriation transfer from an unknown source (general fund?) into a renamed account called the “Alternative Transportation Account.”]
• The deficit between the trust fund outlays and the gas tax revenue (anywhere from $30-60 billion over 5 years) will be offset, in part, with royalties from opening lands in Alaska, parts of the continental US, and offshore to oil and gas exploration.
• Yet again, there is a provision slipped into the bill that grants a permit to TransCanada Corp. for construction of the Keystone pipeline.

Read More →

Last week, several House committees favorably reported the $260 billion 5-year House GOP highway bill to the full body.  This 846-page behemoth is now headed to a floor vote sometime next week.  Simply put, conservatives oppose the House leadership’s highway bill (H.R. 7) because it continues the failed top-down federal approach to transportation spending, while precluding devolution to the states for at least another five years.  Moreover, it eschews the pay-as-you-go funding mechanism of the Highway Trust Fund (eerily similar to the Social Security Trust Fund!) by permanently authorizing a higher level of spending than the fund’s corresponding revenue source; the federal gas tax.

Nevertheless, let’s disregard the policy concerns for a moment and focus on the political argument.  Just as they did with the budget battles of 2011, GOP leadership is selling this bill as the best alternative, a virtuous improvement of past policies.  And undoubtedly, on paper, the version that will be presented to conservative House members (as opposed to the final version after they cave) contains many good provisions:

• It eliminates the mandate requiring states spend 10% of their transportation funds on transportation enhancements and bike lanes.
• No earmarks. Dozens of old and/or redundant programs are eliminated.
• While it continues to fund Mass Transit to the tune of $8.4 billion annually, this legislation bars gas tax revenue from being diverted in order to support public transportation. [Although, in fine print, the legislation will still fund public transportation projects with a one-time $40 billion appropriation transfer from an unknown source (general fund?) into a renamed account called the “Alternative Transportation Account.”]
• The deficit between the trust fund outlays and the gas tax revenue (anywhere from $30-60 billion over 5 years) will be offset, in part, with royalties from opening lands in Alaska, parts of the continental US, and offshore to oil and gas exploration.
• Yet again, there is a provision slipped into the bill that grants a permit to TransCanada Corp. for construction of the Keystone pipeline.

Read More →