The Concord Coalition said today that the Senate, in adopting a Fiscal Year 2018 budget resolution calling for deficit-financed tax cuts of up to $1.5 trillion over 10 years, has abandoned fiscal responsibility and embraced deepening debt as a misguided economic growth strategy.
“No amount of window-dressing can hide the fact that the Senate is giving up on the tough choices needed to put the budget on a sustainable path and truly grow the economy,” said Robert L. Bixby, Concord’s executive director. “The flawed premise of this budget is that tax cuts alone, regardless of their financing, composition or magnitude, will enhance long-term economic growth. This thinking mistakes an adrenaline shot for a cure. It is far more likely that the added debt will give future Congresses an even bigger hole to dig out of.”
While the Senate budget claims more than $5 trillion of spending cuts, it does not include enforcement mechanisms to put them into effect. This is in contrast to the fast-track “reconciliation” process used to ease the passage of tax cuts. It is also in stark contrast to the more responsible House-passed budget which assumes deficit-neutral tax reform and $200 billion of mandatory spending cuts enforced through reconciliation.
In celebrating the 25th anniversary of The Concord Coalition this year, we have been reviewing “lessons learned” to guide policymakers on fiscal reform in the future. This budget fails when evaluated according to some of our key lessons: tax cuts don’t pay for themselves, PAYGO (pay as you go) is an important standard, and the budget process should be focused on long-term planning.
With this budget passage primarily being a procedural vehicle for tax legislation, it’s important to point out something to those writing that legislation: Just because they can now increase deficits with a tax bill doesn’t mean they have to. There is still time to create fiscally responsible, revenue-neutral tax reform.