Having Your Cake-¦

By U.S. Senator Jon Kyl If there's one thing every American on a budget knows, it's that you can't have it all. Americans know that, if you increase spending in one area of your budget, you have to limit spending somewhere else, or risk going into debt. And they know that, if you're already in debt, you have to cut back to pay the money you owe. Unfortunately, the budget proposal approved by the Senate in March fails to stick to the principles that Americans on a budget must do. The Democrat-drafted budget sent one loud and clear message: You can have it all. You can increase spending to the tune of $150 billion, pay down the deficit, and create a budget surplus all at the same time. Only one problem where to get the money for all of this? The budget conveniently disguises that it allows massive tax increases to pay for increased spending. The budget claims to balance the federal budget by 2012, and produce a surplus, while spending approximately $150 billion more than the President's proposed over the next five years. At first, proponents argue that all of this could be accomplished by closing or narrowing the "tax gap," which is the difference between what the government expects to collect in taxes and what it actually collects. But, as the New York Times recently reported, even Senate Budget Committee Chairman Kent Conrad "conceded that reducing the so-called tax gap would not provide enough money on its own." Without any way of paying for these spending increases, Democrats are left with their old standby: raising taxes and the budget proposal does just that. By failing to extend the 2001 and 2003 Republican tax relief initiatives, the budget will result in a $900 billion tax increase over the next five years the largest tax increase in U.S. history. Beginning in 2010, millions of American families would face punishing tax increases. Families with the lowest incomes would face the heaviest increases. I introduced two amendments during consideration of the budget that would have averted some of the punitive taxes that come roaring back after 2011. My amendments would have found ways to permanently and significantly reduce the burden imposed by the death tax, which most Americans consider the most unfair tax in our tax code. As a result of 2001 and 2003 Republican tax relief initiatives, the death tax rate is 45 percent this year through 2009. It returns back to its original levels in 2011 and skyrocketing to as high as 60 percent (and exempting only $1 million). My amendments would have protected families, family farms, and small businesses by raising the death tax exemption to $5 million and reducing the maximum death tax rate to no more than 35 percent. Republicans also introduced amendments to the budget that would preserve other tax relief initiatives for hundreds of thousands of families by extending the 10 percent income tax rate reduction. On this we were successful. Unfortunately, our efforts to protect tax relief for students, teachers, senior citizens, and small businesses were rejected by Senate Democrats. The final budget will contain a $736 billion tax increase despite Republican efforts. During the last election cycle, Democrats talked a lot about their commitment to fiscal responsibility and a balanced budget, but their budget demonstrates that they're still committed to the same old tax-and-spend policies. Republicans were criticized last year for not holding spending down. I agreed with that criticism, but warned that it would be worse if Democrats controlled Congress. Now, we'll not only have more spending, but more taxes too over $2,000 more for the average family. We can, and should do better.