In 2009, when Congress passed the American Recovery and Reinvestment Act (stimulus), economists and pundits alike scoffed at the Obama administration’s estimates of the number of jobs that the bill had “created or saved.” Greg Mankiw, Harvard economics professor and former chairman of the Council of Economic Advisors, called the term “an act of political […]
Though Some Cuts Made, Farm Bill is still Flush with Waste
On June 21, 2012, the Senate voted 64-35 in favor of S. 3240, the Agriculture Reform, Food, and Jobs Act of 2012, which would cut the deficit by $23.6 billion over a ten year period. At first glance this seems like a lot of money, until you realize that the bill authorizes a total of $969 billion in spending for fiscal years (FY) 2013 to 2022, and that the $23.6 billion reduction represents just 2.4 percent annual savings or $2.36 billion per year over the coming decade. The legislation does eliminate some wasteful programs, such as the Average Crop Revenue Election program, direct payments, and counter-cyclical payments, but many profligate programs are left largely unreformed and new ones have been created.
Cutting Spending and Waste in Fisheries
Bureaucratic, command-and-control regulation of coastal fisheries wastes taxpayers’ dollars and endangers the sustainability of this common resource. Managing a shared resource like fish in the sea is a difficult problem. Since no one owns them, there has always been simply a race to capture as many as you can and bring them to market. Ownership […]
Trivial Resolutions Come at a High Cost to Taxpayers
According to a June 2012 Gallup poll, 79 percent of Americans disapprove of the way Congress is handling its job. Perhaps this is because legislation passed by members of Congress is all too often a reflection of their parochial rather than overarching national interests. What this means for taxpayers is that instead of focusing on job creation, deficit reduction, and turning the economy around, Congress is wasting its resources on inconsequential measures, such as commemorative resolutions.
Low Hanging Fruit Not Too Low to Cut
When evaluating the overall budget picture, many analysts understandably and appropriately focus on the big ticket spending items, especially the largest and fastest growing portions of the federal budget, entitlements. Sometimes, it pays to think smaller scale and evaluate low hanging fruit when looking for areas to reduce costs.
Undocumented Workers Receive Billions in Tax Credits
On July 7, 2011, the Department of the Treasury’s Inspector General for Tax Administration (TIGTA) issued a telling report. TIGTA found that unauthorized workers who are ineligible to obtain Social Security Numbers (SSNs), the vast majority of whom are illegal immigrants, were paid $4.2 billion in refundable tax credits in 2010.
Gulp! Mayor Bloomberg’s Ban on Large Sodas is Hard to Swallow
New York City Mayor Michael Bloomberg believes that the local government should crack down to help those with a coke addiction…but he’s not talking about drug addicts. On May 31, 2012, Mayor Bloomberg proposed banning the sale of large-sized sodas, sports drinks, sweetened tea or coffee, and other sugary beverages as an antidote to the rising obesity problem. Bloomberg noted that more than half of NYC adults (58 percent) are overweight or obese.
Higher Education: The Next Bubble
The nation’s outstanding student loan balance climbed to more than $1 trillion in May, which includes $460.2 billion held by the federal government. If the higher education bubble bursts, taxpayers will have to clean up the mess.
Reform the Senate Office Allowance System
A culture of inefficient government spending is endemic in Washington, D.C. However, such behavior is particularly frustrating for taxpayers when the rare example of spending less money produces an unsatisfactory outcome. This is unfortunately how the funding structure for Senate office expenses is designed. Due to a perverse system of incentives, senators who do not […]
Tobacco Excise Taxes Burn Down Federal Revenues
An April 2012 Government Accountability Office (GAO) report found that excise tax increases on certain tobacco products have resulted in dramatic shifts by manufacturers and consumers toward lower tax products. Specifically, the implementation of taxes on roll your own tobacco and small cigars have led to increases in production and consumption of pipe tobacco and large cigars. While the government has historically used tobacco taxes to raise revenue, GAO’s study revealed that these disparities in taxation instead decreased federal revenues.