October 20, 2014

CONCORD COALITION WARNS BASELINE AGREEMENT SHOULD COME BEFORE TAX CUTS

WASHINGTON -- The Concord Coalition today urged Congress to agree on a budget baseline before approving any tax cuts, including the Marriage Tax Penalty Relief Act (H.R. 6) scheduled to be debated Thursday in the U.S. House of Representatives.

 

“Tomorrow's tax cut vote is nothing less than a preemptive raid on an undefined surplus. Congress should first agree on a baseline and thereby define its projected surplus, before voting on any legislation to spend the surplus. Giving away chocolates, rather than giving away the surplus, would be a less expensive and more appropriate way to celebrate Valentine's Day,” said Concord's Executive Director Robert Bixby.

 

“There will be plenty of time this year to debate the best use of the surplus. But as of now, it is impossible to do so in a responsible manner because Congress has not decided which of the many baseline assumptions it will use to determine just how much of a surplus they're anticipating,” Bixby said.

 

“CBO has developed three baselines to choose from and OMB has come up with its own baseline.  Even so, Congressional leaders have said they want to consider additional baselines. Whatever the merits, marriage penalty relief does not need to be taken up now, before the baseline issue has been settled.  Nor is there any good reason to give this particular tax cut a privileged position ahead of all other competing uses for whatever surplus projection Congress finally agrees upon,” Bixby said.

 

Baseline Menu ¾ Non-Social Security Surplus in Billions of Dollars

 

Baseline

2001-05

2006-10

Total

OMB

  95 (13%)

  650 (87%)

  746 (100%)

CBO “inflated”

148 (18%)

  690 (82%)

  838 (100%)

CBO “freeze”

379 (20%)

1,480 (80%)

1,858 (100%)

CBO “capped”

594 (31%)

1,325 (69%)

1,918 (100%)

Other

?

?

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Note:  numbers may not add up due to rounding

 

The Concord Coalition is a nonpartisan, grass roots organization dedicated to balanced federal budgets and generationally responsible fiscal policy.  Former U.S. Senators Warren Rudman (R-N.H.) and Sam Nunn (D-Ga.) serve as Concord's co-chairs and former Secretary of Commerce Peter Peterson serves as president.