If you have cheated on your federal taxes or plan to do so in the future, well, the Republican Congress has a deal for you. The “Limit, Save, Grow Act”, passed by the Republican dominated Congress last month, would repeal the infusion of cash to the Internal Revenue Service which was authorized last year under the Inflation Reduction Act. Although this cut would reduce federal expenses by $80 billion, the IRS investment was expected to generate $204 million in revenues through better enforcement.
The bill, however, makes up for this deficit by incorporating additional work requirements in programs serving people on Medicaid or food stamps. In other words, the act would mandate sacrifices from poor people in order to provide a shelter for tax cheats.
There are a number of other troubling items in the Republican bill, but the reader might be particularly interested to know that half a $trillion in tax credits for clean energy passed by Congress last year would be eliminated from the budget over the next decade. The goal of the tax credit is to put the country on a path to reduce greenhouse gasses by 40 percent below 2005 levels by 2030. Defending the bill as a means to lower government debt, Republican House Budget Committee Chairman Jodey Arrington declared that “… not one time did my Democrat colleagues mention the children and grandchildren of the people … the future generation of Americans who will inherit the whirlwind.” With the UN claiming that climate change “is the largest, most pervasive threat to the natural environment and societies the world has ever experienced,” the irony is that Arrington’s prophecy is more likely to come to fruition if the bill’s provisions become law.
The Republicans passed this bill in the House with the expectation that they could use it to bargain with the Senate and the President over raising the debt ceiling. You may already be aware that the debt ceiling (or more formally, the debt limit), is the “total amount of money that the United States government is authorized to borrow to meet its existing legal obligations.”
Although Congress has raised the debt limit numerous times since it was first created in 1917, there are legitimate concerns with allowing debt to surpass a certain threshold. Many economists measure debt against the Gross Domestic Product (GDP), a measure of the monetary value of purchased goods and services produced within a country’s boundaries in a given period of time. The comparison provides some indication of how likely the country is to pay off its loans. The current debt-to-GDP ratio in the US is 123.4 %, considerably more than the 77% threshold of what the World Bank considers to be acceptable.
Cataclysmic events such as the great Recession and COVID-19 over the past 20 years have certainly increased borrowing (primarily for the purpose of stimulus spending) while depressing GDP, but the tax cuts under George W. Bush and Donald Trump have also played a significant role.
So, yes, the debt is something that we need to address, but the “Limit, Save, Grow Act” is obviously not the way to do it. While all of the provisions of the act would cut $4.8 trillion over ten years from a federal debt that currently stands at $31 trillion, Moody’s Analytics forecast that the budget cuts in the bill would also cost the economy 784,000 jobs. Moody’s also forecast the possible loss of 7 million jobs if Republicans fail to raise the debt ceiling immediately, thereby defaulting on the country’s current loans.
Republicans are hoping that somehow, they can make the debt ceiling debate a major issue in their favor in the 2023 and 2024 elections. Let’s prove them wrong.
Here’s what you can do.
Contact your elected U.S. House representative, and tell them that:
1. they need to hammer out a long-term solution to the country’s debt problems, but
2. the debt ceiling must be raised now;
3. People receiving food stamps and Medicaid should not be forced to subsidize tax cheats; and
4. solutions to the world’s environmental problems are inviolable.
It is particularly important that Brian Fitzpatrick hear from his constituents. Mr. Fitzpatrick portrays himself as a moderate, but his support of the Limit, Save, and Grow Act is worrisome. You can find your representatives and how to contact them by going here.
You may also want to write a letter or an op-ed to the Inquirer or local newspapers emphasizing the points listed above.
Here are some of the contacts:
For the Bucks County Herald: email@example.com