Tax, Economic Policies Lead To Deficit Reductions

Tax, Economic Policies
Lead To Deficit Reductions

Washington, D.C. - On Tuesday the Office of Management and Budget announced that the federal deficit is projected to be $127 billion less than was projected just six months ago. Republicans in Congress have been fighting for years for tax relief to grow our economy and allow the American people to keep more of their hard-earned money, and this announcement is another example that those policies are working.

When we passed tax relief to reduce tax rates for every American taxpayer, eliminate the death tax, and reduce the tax on capital gains, opponents argued that these tax cuts would deprive the government of revenues, but the opposite effect has happened. Tax cuts have increased revenue to the government and driven down the deficit. And they've helped spur the economy.

In June, the U.S. economy gained 121,000 jobs, marking the 34th straight month of job gains. The current unemployment rate of 4.6 percent is lower than the average of the 1960s, 1970s, 1980s, and 1990s. And in the first quarter of 2006, our economy grew at a robust annual rate of 5.6 percent.

In Oklahoma, revenues from the oil and gas sector have helped buoy the state's budget situation. Although a devastating drought has put our farm sector in a financial bind, with this year's wheat harvest being the smallest in more than 40 years, our state's unemployment rate is at 4.1 percent, below the national average.

The President has set a goal of cutting the deficit in half by 2009, and Congress has delivered on that goal by cutting non-security spending. Another way Congress can help reduce federal spending is by passing legislation to give the President line-item veto authority. President Bush has indicated he will sign the legislation to give the president increased authority to remove unnecessary or wasteful spending items from spending bills, if Congress will pass the legislation.

The House passed the Legislative Line Item Veto Act in June, and I'm hopeful that the Senate will do the same. Under the proposed legislation, the president would have 45 days to propose to Congress the cancellation of a spending item in legislation sent to his desk. Congress then must introduce a bill reflecting these cancellations and bring it to the floor for an up-or-down vote.

I voted for this legislation because a line-item veto bill will increase transparency and accountability in federal spending and discourage wasteful and unnecessary spending.

The recent economic news and deficit reduction numbers point to real progress in our efforts to use fiscal restraint in Congress. But we must continue to fight excessive spending in Congress, maintain our watchdog oversight of Washington bureaucrats, and work to cut government waste. We have a responsibility to future generations to hold the line on spending and leave them with a federal government that is fiscally responsible.

http://www.house.gov/list/speech/ok03_lucas/deficitreduction.html