The following article by NC Congresswoman Virginia Foxx is from an email newsletter.
$5,700,000,000,000 tab rung up in six months
By Congresswoman Virginia Foxx
The approach of springtime is notable for two things in Washington: cherry blossoms and budget season. Washington’s famous cherry trees haven’t yet emerged from their winter hiatus, but the budget juggernaut is already in full swing. As you can probably imagine, it’s not a pretty picture.
Before we take a closer look at the budget it is important that we lay some groundwork. The past six months have witnessed an historic and unprecedented spending spree in Washington.
In the rush to bailout anything that moves, almost any fiscal context has been lost. Stimulus package, bailout, trillion dollar budget deficits. Each of these terms has steadily lost meaning over the course of our economic meltdown. For the sake of clarity here are a few definitions and please bear with me if you are one of those who have this all down pat.
TARP bailout: passed by Congress last fall and signed by President Bush. This program set aside $700 billion to buy the so-called toxic assets (mostly bad mortgage debt) held by America’s banks. Of this amount, $350 billion was made available immediately and the second half required Congressional sign-off. The second $350 billion was recently approved by the Senate for President Obama to use as he see’s fit. I joined a bipartisan group in voting against the TARP bailout in 2008 and 2009.
Stimulus package: passed by Congress in February. This package had a price tag of about $800 billion. Despite the promise of no earmarks, it was plagued from the start with pet projects and carve-outs for special interests. President Obama pushed for its passage as a job creation measure. Because it contained little in the way of job-creating tax cuts and instead was stuffed full of expensive big government programs that will do almost nothing to revive our economy, I voted against it.
Omnibus appropriations: nine separate budget bills totaling $410 billion that passed the House in late February. As a holdover from last year’s spending legislation this bill finishes the job of appropriating money to many federal agencies. It contains about 9,000 earmarks and represents an 8.3 percent increase over the previous year’s spending. This massive bill included spending gems such as money for tattoo removal programs in California and huge funding increases for UN programs that promote and provide abortions around the world.
Housing bailout: a plan proposed by President Obama in mid-February that will spend $275 billion in an effort to stabilize the housing market. The problem with this housing bailout plan lies in the simple fact that it rewards bad behavior—something called “moral hazard” by economists. This plan will use taxpayer money to lower the payments of homeowners who bought houses they can’t afford.
Of course more than 90 percent of American homeowners are current on their mortgages and are not in danger of losing their homes. This plan does not give those who played by the rules a fair shake. Instead it rewards bad behavior and risky lending practices. In turn it punishes hardworking families who are paying their mortgages on time and are trying to make ends meet in a troubled economy.
President Obama’s Budget Request: last but certainly not least, President Obama presented his proposed budget to Congress in the last week of February. It will serve as a guideline for next year’s federal spending. This year, federal spending will approach $4 trillion–a one-third increase in the size of government in a single year. His budget blueprint for next year totals $3.5 trillion and provides $750 billion for yet another bank bailout (see TARP bailout), $646 billion in taxes on energy and an overall increase in non-defense spending of 9.3 percent.
All told these proposals and programs total about $5,700,000,000,000 in federal spending—a number thought inconceivable until now.
I am sure that many of the loudest voices in favor of government bailouts in the banking sector, the housing market, and anywhere else that “needs” an infusion of your tax dollars sincerely believe runaway spending is the cure for what ails this economy.
The proponents of massive government spending claim that this money will stimulate the economy. That remains to be seen and with very little of the money going to actual job-creating projects, I’m convinced that it may simply inflate our debt and do more harm than good.
But even if these programs, from bank bailouts to bloated budgets, fail to achieve their purpose, America has an ace up its sleeve. America is a strong and resilient nation and I am confident that once again American ingenuity and hard-working Americans will bring us back—even if today’s policies are flawed and misguided.