Hearing of the House Budget Committee - The President's FY 2016 Budget

Hearing

Today Maryland Congressman Chris Van Hollen, Ranking Member of the House Budget Committee, made opening remarks at the House Budget Committee hearing on the President's Fiscal Year 2016 Budget. Below are his remarks as prepared for delivery:

"Thank you, Mr. Chairman. Director Donovan, I join the Chairman in welcoming you to the House Budget Committee, and I thank you for your service to our nation.

"I am pleased we have a chance to discuss the President's Budget for fiscal year 2016. Unfortunately, here in Congress, we have not completed work on the FY2015 budget process. The short term funding for the Department of Homeland Security will expire in a few weeks. Despite terrorist attacks in Europe and elsewhere, Republicans in Congress have threatened to cut off funding for homeland security because of disagreement with the President's immigration reform actions.

"Republicans also voted yesterday -- for the 56th time -- to repeal the Affordable Care Act. But the Republican budget last year would not have come to balance without the revenues and savings generated by the reform law. So while the Chairman is quick to criticize the President for not balancing, it's important to note that Republicans simply cannot have it both ways on the ACA.

"We meet at a time when our economy is improving. Jobs grew last year at the fastest pace since 1999. Indeed, we've seen the fastest economic growth in over a decade. Our deficits have been cut by two-thirds. The stock market has doubled. Gas prices are down. And health care cost growth is at its lowest rate at any time in the last 50 years. This is all very good news, and it would not have been possible without the tough decisions President Obama made right after he was first sworn in to stop the economic free-fall and put the nation on the path to recovery.

"It is certainly a good thing that we did not pursue the advice of those in Congress who pushed for a European-style austerity program to slash federal investments. The reality is that since 2010, more jobs have been created in the United States than in Europe, Japan, and all advanced economies combined. Good thing we pursued a different course.

"While there has been much good economic news, one stubborn challenge remains -- Americans are working harder than ever, but their paychecks have been flat and wages have stagnated. This is not a new problem. American workers' productivity has increased dramatically since the late 1970s, but workers' real compensation has remained relatively stagnant over that period. Meanwhile, the economic benefits from these productivity gains have increasingly been concentrated at the highest income levels. Addressing this challenge is not just a question of economic fairness; it's a question of economic growth. A pro-growth strategy is one that promotes broadly shared prosperity. Giving working Americans a larger share of the economic pie can make the entire pie to grow faster -- and that is the focus of the President's budget.

"The budget boosts take-home pay for the middle class and those working to join the middle class. The budget's tax reforms include tax cuts for two earner middle class families, provides significant tax credits to cover the cost of child care and college, supports increased retirement saving by working families, and improves the Earned Income Tax Credit and the Child Tax Credit. The budget pays for these improvements with measures reducing tax giveaways to special interests and the wealthy.

"The United States spends a significant amount of money through our tax code. In fact, more is spent on tax exemptions than on Medicare and Medicaid combined each year. While some tax expenditures promote worthwhile activities such as personal retirement saving and research and development investments, the code is also littered with special-interest giveaways, and it imposes higher tax rates on income earned through work while providing preferential treatment to unearned financial gains and multi-million dollar inheritances. The tax code's preferential treatment of non-work income contributes to the fact that 17 percent of the major tax expenditures in the tax code flow to households with the top 1 percent of incomes. Taken together, the President's tax proposals create a simpler and fairer tax code that invests in middle-class families.

"President Obama also understands that raising pay requires strategic investments to sharpen America's competitive edge in the global 21st century economy. This budget helps accomplish that by making education more accessible and affordable, from preschool through college; making a $478 billion, six-year investment in roads, transit, and other infrastructure; and beginning the process of undoing the mindless sequestration cuts that have undermined our ability to make critical strategic investments. By restoring that funding, this budget allows for strategic investments, such as a $3.6 billion education funding increase and $1 billion more for cutting-edge research at the National Institutes of Health.

"The President's budget accomplishes these ambitious goals while putting us on a path to fiscal sustainability through smart, responsible deficit reduction. The budget reduces ten-year deficits by about $2 trillion through targeted spending cuts and elimination of many special-interest tax breaks and loopholes. The budget stabilizes the debt as a share of the economy and puts it on a downward path.

"The President understands that a pro-growth economic strategy is one that lifts the paychecks of all Americans. The trickledown economics and tax cuts to the wealthy were a miserable failure. The only thing that went up was the incomes of the already wealthy and the deficit.

"It seems as though our Republican colleagues have no problem redistributing wealth -- just as long as it is going from the middle class up to the top 1 percent. It's time to focus on growing an economy that works for 100 percent of Americans. And the President's budget moves us in that direction.

"Thank you."

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