Congressional Democrats Pass Budget That Puts Working Families First

Thursday, May 17, 2007

Contact: Chuck Oxley (208) 871-4976 (office)

BOISE, Idaho – After six years of fiscal irresponsibility on the part of Republicans in Congress and President Bush, Democrats passed an economically sound budget that cuts taxes for working families and invests in our future. Democrats are keeping the promises they made this past election by balancing the budget while funding national priorities such as children’s health care, education and veterans benefits.

Prior to the Bush Administration, America enjoyed a $5.6 trillion surplus, but in the last six years the President and his Republicans in Congress have squandered the surplus and run up a $9 trillion deficit. Instead of helping working families, Republicans have been intent on leaving debt to future generations.

“For the past six years Republicans have been spending our money like a lottery winner who’s learned he’s got 24 hours to live,” said Idaho Democratic Party Chairman Richard Stallings. “There’s nothing conservative about running up astronomical deficits, leaving debt to future generations and cutting critical funding. It has taken a Democratic Congress to restore fiscal responsibility. I’m proud Democrats are keeping our promises by funding important national priorities and providing tax relief for Idaho’s hard working families “

Democrats Keep Their Word and Balance the Budget

A Balanced Budget Must Be Accompanied by Balanced Priorities – The Conference Agreement rejects the President’s proposals to again cut critical domestic priorities. It provides needed resources in key areas such as:

Kids’ Health - SCHIP

The Conference Agreement rejects the inadequate funding level proposed by the President for children’s health care and instead provides up to $50 billion for expanding coverage and improving children’s health through the State Children’s Health Insurance Program (SCHIP). There are an estimated six million children eligible but not enrolled in either SCHIP or Medicaid. These additional SCHIP funds will expand coverage to uninsured children and ensure states can maintain current caseloads.

Education

The Conference Agreement rejects the President's proposed cuts in education and training and adds significant new resources that could be used for the Individuals with Disabilities Education Act (IDEA), No Child Left Behind Act, and Pell grants. For 2008 alone, it provides an increase in discretionary funding for the education and training function of $9.5 billion (including $2 billion in additional 2009 advance appropriations) above the President's request.

Veterans

The Conference Agreement provides critical resources to ensure that our nation's veterans get the high quality health care they deserve. The Conference Agreement provides $43.1 billion for discretionary veterans’ programs, including medical care, and is consistent with The Independent Budget, a plan developed by four leading veterans groups, and the recommendation of the American Legion. This funding level is $3.6 billion more than the President in 2008 and more than $30 billion above the President over five years. For veterans’ medical care, it represents the largest increase ever provided.

Protects Middle-Class Taxpayers – The Conference Agreement balances the budget without a tax increase.

Middle-Class Tax Cuts

The Conference Agreement supports middle-class tax relief, including extending marriage penalty relief, the child tax credit, and the 10 percent bracket subject to the pay-as-you-go rule. It also supports reform of the estate tax to protect small businesses and family farms. House provisions include additional procedural protections to help ensure fiscal responsibility.

AMT Relief

The Conference Agreement prevents the spread of the Alternative Minimum Tax (AMT), so that it does not impose higher taxes on middle-class families. It ensures that the number of taxpayers subject to the AMT will not be allowed to increase in 2007 – protecting some 20 million middleclass taxpayers from being subject to the tax.

No Tax Increase

Over the five years of the Conference Agreement, revenues total $14.828 trillion, which is virtually identical to the President’s level of $14.826 trillion, as estimated by his own administration. And revenues are only 2.1 percent above the President’s level, as estimated by the Congressional Budget Office. The modest additional revenues in the plan can be achieved by closing the tax gap, shutting down abusive tax shelters, addressing offshore tax havens, and without raising taxes.

Closing the tax gap is not about raising taxes on anyone. It is simply collecting taxes that are already due under current law. While we will never be able to close the tax gap entirely, it is clear that much more can and should be done. To help close the tax gap, the Conference Agreement supports steps to increase reporting and withholding requirements. It also fully funds the President’s budget request for the IRS, including additional resources available through a discretionary cap adjustment that directs $406 million to IRS enforcement activities.

[Source: Budget Conference Agreement Overview, House/Senate Caucus, 5/16/07 ]