In a Milwaukee Biz Blog on Monday, Congressman Jim Sensenbrenner argued that the Congress he has belonged to and shaped for almost three decades is responsible for creating the Alternative Minimum Tax (AMT) "mess" that may delay refunds for millions of taxpayers.
Instead of delaying until Christmas the temporary tax fix Sensenbrenner voted for, he argued that Congress should "put the American taxpayer first."
He continued by disparaging "misguided" efforts to "compensate for the AMT funds," which presumably included proposals to either cut spending or raise taxes.
What Congressman Sensenbrenner doesn’t tell you is that his vote for the temporary AMT "patch," combined with the "yes" vote he also cast that same day on a massive, $555 billion, 3,400 page spending package filled with earmarks – including $213,000 for olive fruit fly research in France – didn’t lower taxes. It raised them – tomorrow.
Between 2001 and 2007, Congressman Sensenbrenner and the Republican leadership abandoned traditional conservative values by embracing both tax cuts and massive government spending, a process that left America $3 trillion further in debt in just six years. Year after year, appropriation after appropriation included thousands of earmarks, massive deficit spending and accounting trickery. And in 2003 he voted for the biggest expansion of government since 1965 – Medicare’s Prescription Drug Program.
Our Congressman and the rest of party leadership could get away with this by distorting long-term budget projections. There is no need to cut spending to pay for the 2001 and 2003 tax cuts, he said: "This (tax cuts) is more of a brake on spending than anything else." Later that year he voted for what Comptroller General David Walker of the Government Accountability Office called "the most fiscally irresponsible piece of legislation since the 1960’s." The Congressional Budget Office (controlled by the party leadership) facilitated this spending spree by using accounting rules that would land any private sector chief financial officer in prison:
Tax cuts were "sunset" to expire by the end of the decade, allowing party leaders to claim, falsely, that revenue to the federal treasury would spike in 2010 (when tax cuts revert to their previous rates) and produce a surplus.
The Alternative Minimum Tax’s steady reach downward was also factored into long-term budget projections, allowing party leaders to falsely point to a coming surplus.
Iraq war expenditures and Katrina relief were placed "off budget," not included in annual deficit numbers but moved directly to the cumulative federal debt, allowing party leaders to claim that the budget deficit is declining. Future Iraq expenditures were also left out of long-term budget projections.
These, combined with cash accounting procedures that violate GATT and Congress’s continued spending of the now-declining Social Security surpluses, leave us in the precarious situation we find ourselves in today.
In approving the AMT "patch," Congressman Sensenbrenner again violated a traditional Republican approach to legislating – adherence to "pay-go," a standard that any spending increases or tax cuts cannot rely on deficit spending. The biggest objections to the "patch" came from Blue Dog Democrats, a coalition of mostly southern, fiscally conservative Democrats.
The AMT "patch" added $50 billion to the national debt because it wasn’t offset by spending cuts, raising tomorrow’s taxes by several hundred dollars per taxpayer. The $3 trillion in debt accumulated between 2001 and 2007 added nearly $30,000 to tomorrow’s tax bill for each taxpayer. Little wonder Republicans lost control of Congress last year, or that more Americans trust Democrats to be the party of fiscal responsibility in Washington.
If Republicans hope to retake Congress this year or anytime soon, they must return to the traditional core of conservatism – a hawkish adherence to fiscal responsibility. This means supporting pay-go (as they did under Newt Gingrich), demanding that Congress adhere to the same accounting rules the private sector follows, and promising never – particularly during times of economic growth – to vote for legislation that raises tomorrow’s taxes.
Jim Burkee is an associate professor of history at Concordia University Wisconsin and a Republican candidate for U.S. Congress in the 5th District.
