If Congress showed restraint, we wouldn't have a deficit
Congressional Democrats remain confident voters will hand them the keys to Congress on Nov. 7. However, amid their relentless chatter about the House page scandal and Iraq, a confluence of events has brought them concern on the domestic front: The U.S. economy is profoundly ... strong.
Unemployment remains low. A quiet hurricane season and relative political calm in the Middle East have resulted in lower gasoline prices. The Dow Jones Industrial Average is at an all-time high. Job creation, wages and consumer confidence are up.
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On the government side, federal tax collections grew 11.8 percent this fiscal year -- more than three times the rate of inflation -- to a record $2.41 trillion. Income tax receipts increased 12 percent to more than $1 trillion, and corporate tax receipts ballooned 27 percent to $354 billion. "Corporate tax receipts as a share of (the economy) are at levels not seen since the late 1970s," the Congressional Budget Office wrote in its August report.
As a result, the federal budget deficit is shrinking. It now stands at about $248 billion, a four-year low. Earlier this year, the Bush administration predicted the 2006 budget deficit would top $420 billion.
Republicans are attaching their re-election campaigns to the economy, hoping Americans will vote with their pocketbooks. The GOP is touting the tax cuts ushered by President Bush during his first term as a driving force behind the economy's recovery and subsequent growth.
And if Republicans can retain their majority in the House and the Senate, President Bush wants to make those tax cuts permanent.
"Tax relief fuels economic growth," President Bush said. "And ... when the economy grows, more tax revenues come to Washington."
But the economic good that has resulted from tax cuts has been diminished because Congress can't hold the line on spending. That Republicans, the purported proponents of limited government, would hit the campaign trail boasting of "improved" deficit spending is enough to make Barry Goldwater and Ronald Reagan roll over in their graves.
How much stronger would the U.S. economy be if President Bush and congressional Republicans cured their pork addiction and merely held the line on government growth (forget actual cuts to the leviathan bureaucracy), allowing them to reduce taxes further? By betraying one of their core principles, Republicans have given Democrats an opportunity to claim their party is the standard-bearer of fiscal responsibility, and to cast the budget deficit as a symptom of an unhealthy economy.
Democrats have pointed out that even if Republicans continue to view the economy through rose-tinted glasses, the Congressional Budget Office forecasts deficit spending of at least $1.76 trillion over the next decade. That would push the national debt over $10 trillion.
"Only a president with such a historically bad economic record would be this excited about a $248 billion deficit," said Rep. Carolyn Maloney, D-N.Y.
Republicans lack the pecuniary credibility to point out that Democrats aren't interested in reducing spending, either. Instead, if given control of Congress, Democrats will try to raise taxes to erase the budget deficit, then raise them more to take federal spending through the exosphere.
If the Republicans running Washington could simply balance the federal budget, they wouldn't have a problem winning support for their tax reduction goals. The government isn't running a deficit because of a lack of revenue, and it certainly isn't because the country is tilting toward another recession. Washington is awash in red ink because impulsive congressional Republicans can't put away the credit cards that will one day come due to taxpayers.
Democrats can expect to win converts next month by tweaking a familiar election catchphrase: It's the spending, stupid.