Copy of AFF Sentinel V22 #15-Getting In Gear
- Steve Dittmer
- Jul 22
- 3 min read
Senate Jabs House, House to Try This Week
Steve Dittmer | AFF Sentinel
Colorado Springs, CO
Originally sent to subscribers 02/22/25
President Trump has been moving fast to affect change in many areas. People are policy and Trump has put many change agents in place.
Congressional leadership is struggling to keep up but members of Congress, as a group, are not used to moving fast on anything.
Bills that appropriate funds are supposed to originate in the House. Since the House Republicans, even after the mandate they could claim from November’s elections, have not inspired confidence that they can agree and move quickly, the Senate went ahead on the first of its planned two-bill strategy for a reconciliation bill. It is not a great bill, containing no spending cuts, mostly extra spending, though for needed purposes -- immigration, defense and energy actions -- but nothing for tax continuation.
We use the expression “continuation” deliberately. People seem to forget that the tax cuts of 2017 have been in place for seven years. They were not temporary, even though they are due to expire by 2026. By the end of 2025, they will have been the law of the land for eight years. But the Congressional Budget Office (CBO) acts as if this tax schedule was passed last year. They want to classify any extension of the eight-year tax schedule as something brand new and regard it as a new tax schedule, new tax cuts that will “cost” the federal budget some $4 trillion. The fact that the tax cuts of 2017 have created some $2 trillion in increased federal revenue beyond CBO estimates is something the CBO cannot fathom.
We’ve already shown you in past columns the exact figures of federal revenue increases resulting from the 2017 tax cuts. But the CBO, which forecast huge federal revenue decreases from the 2017 tax cuts, has not learned anything and continues to ignore the data from their own government. It’s as if the relatively recent history of JFK, Ronald Reagan and Donald Trump didn’t exist.
The CBO has a lousy record and luckily, the House Budget Committee is smartly going to ignore the CBO’s scoring of any extension of the 2017 tax cuts as a catastrophic ballooning of the federal deficit. Sen. Mike Crapo was one of the first members of Congress that pointed out that by law, it is the Congress who is empowered to set baseline budgets, not the CBO. As the Senate Finance Committee chairman, he has said the committee is going to set its own budget baseline and ignore the cries of doom from the CBO.
Rep. Brandon Gill (R-Tx), a member of the House Budget Committee, told Larry Kudlow this weekend that their committee was going to ignore the CBO also. The plan was to hold a vote on the instructions that would be given to the committees on Tuesday of this week. That would be the first step in the process of getting a bill together.
Kudlow speculated that the Senate bill not including any tax provisions was disheartening to the country, with the stock market shedding 1,200 points since that bill passed the Senate.
Gill said that besides continuing the 2017 tax schedule, the House was working on some other tax cuts plus some DOGE provisions. He added that they are not using CBO assumptions, like only 1.8 percent growth.
But businesses need to have some certainty about tax rules and deregulation so they can plan capital investment.
Also on the Oversight Committee, Gill said they can claw back some of the fraudulent and corrupt payments made, e.g. what Lee Zeldin has found at the EPA. Other money will require a rescission bill passed by both Houses of Congress. The Senate will not be a big help on that, as they have been part of the problem in the first place, Gill said. However, they will try to get some rescission elements in the reconciliation bill. Of course, the challenge of using the reconciliation process is the complicated and somewhat opaque rules determined by the Senate parliamentarian as to what can be included in the bill.
Incidentally, a recent McLaughlin poll indicated tax reform was the most important issue to voters, now that the Administration has quickly shut down the border.
Consumer sentiment has dropped recently but close examination showed that it was the Democrats and independents who are discouraged over inflation and tariff concerns, Liz Peek said.
Sentiment can change quickly if Congress gets in gear and does what the voters voted for: tax reform, border security and crime reduction, deregulation and energy production and cost reduction. But they need to move now, especially as regards tax law, not put it off until the second half of the year.
Our address: Agribusiness Freedom Foundation, P.O. Box 88179, Colorado Springs, CO. 80908.
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