Copy of Sentinel V22 #38-Sunday Not Silence
- Steve Dittmer
- Jul 22
- 4 min read
Who’s Really Responsible for Budget Committee Fight?
Steve Dittmer | AFF Sentinel
Colorado Springs, CO
Originally sent to subscribers 05/18/25
We know working on the weekend is nothing new for most of you. With Congress, we don’t see it too often. But Sunday night at 8:00 EDT the House Budget Committee will be meeting to re-vote on the reconciliation bill that failed Friday. Negotiations have no doubt gone on all weekend.
The Republicans know they have to pass this bill, so what has been going on? The conservative Freedom Caucus has been getting the blame for torpedoing the vote Friday but there’s an easy case to make that it is the moderate Republicans that are breaking ranks on policy to gum up the works. By refusing to give up on spending issues that are closer to Democrat positions, they are forcing the conservatives to set their feet and yell whoa.
What issues are triggering the problems? Republicans in some districts are pushing to keep Green New Deal subsidies from the Inflation Reduction Act passed during the Biden administration. Again, it is a case of Republicans fearing what the “news” media or Democrats will harp on, instead of doing what Republicans -- back by voters in November -- should do.
Then there is SALT -- the state and local tax deduction. Republicans in blue states with huge state tax burdens -- like New York, California and Illinois -- got a 2017 boost in allowing them to deduct up to $10,000 in state and local taxes paid from their federal income tax liability. The new reconciliation bill would raise that to $30,000 -- and they are complaining that it’s not enough. They want the taxpayers out in flyover country to subsidize their high state tax rates.
Another example, is not requiring able-bodied people to work for food stamps and Medicaid until -- wait for it -- 2029, not now. Not only was Medicaid intended to support pregnant women and the disabled, it was not supposed to provide free rides for abled-bodied males with no young kids at home. The eligibility rules were loosened by Presidents Obama and Biden. And, of course, funding those extra eligible people with 90 percent federal money just ballooned the total cost of the federal Medicaid budget.
Rep. Claudia Tenney (R-NY) said there are five million people in her state alone that are ineligible but getting benefits anyway. Then there are many thousands of illegal aliens in some states getting benefits. Out and out Medicaid fraud is estimated at $150 billion a year.
Is it any wonder the holdouts, like Rep. Chip Roy, (R-Tx.), Ralph Norman (R-SC), Josh Brecheen (R-OK.) and Andrew Clyde (R-Ga.) are raising cane? Front-loading tax cuts and delaying spending cuts just makes the deficit calculations worse.
Added to that, is the problems with Senate reconciliation rules. They force the bill to be constructed and calculated using static CBO calculations instead of dynamic calculations that reflect actual, real-world situations
For example, the CBO is going with estimates of 1.7 GDP growth, nearly half of what we’ve been doing now. Those are Obama years GDP figures. House Ways and Means Committee is using a 2.1 GDP figure, not much better. The difference between 2 percent GDP and three percent GDP is $4 trillion in tax revenue, Kevin Hassett, director, Trump National Economic Council said. Supply side economists figure on three percent on the bottom and four percent not out of the question, given a reconciliation bill that includes tax cuts generating more revenue; deregulation cutting costs in time and money for businesses; DOGE spending cuts; other discretionary spending cuts; already lower inflation from lower government spending and the Federal Reserve not pumping more money supply into the economy.
Larry Kudlow, economist who was there during the fights over tax cuts during Ronald Reagan’s years, decries what he calls “root canal” Republicans, who agonize over spending cuts and deficits instead of going for growth and increasing revenue. Cuts are necessary but...
Commentary from supply-side advocates are most frustrated that some Republicans still don’t seem to understand supply-side economics, on a weekend when several publications feted the 50th anniversary of Art Laffer’s famous napkin sketch of the Laffer curve for President Ford’s whiz kids Dick Cheney and Don Rumsfeld. Lower tax rates generate growth and more government receipts. And growth is imperative to fixing our financial problems in America.
Ironically, polling indicates that the average American understands the situation better than some Republicans in Congress and the support for the tax cuts is 70-80 percent. Yet, as economist Steve Moore points out, the bill doesn’t even include the 15 percent tax rate Trump has wanted.
Commentator Liz Peek put it succinctly. This is a once-in-a-lifetime chance to cut spending. Congressmen need to have some backbone. Go for growth.
House Budget Committee Members:
Our address: Agribusiness Freedom Foundation, P.O. Box 88179, Colorado Springs, CO. 80908.
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