GOP Alternative Budget Announced

RECOVERY COUNTDOWN, 3/26/2009, posted by John - President Obama has claimed on several occasions that the Republicans "don't offer an alternative budget." The fact is that they do. The GOP plan costs far less and does more by applying the lessons of economic history:

• Ronald Reagan's response to the deep recession early in his presidency was to cut income tax rates by 25% and lower the capital gains tax rate to 20% from 25%. A massive expansion ensued, extending well beyond his two terms.
• After the 9/11 attacks, President George W. Bush made across the board income and investment tax rate cuts. The result was well over 8 million new jobs and about 4.5% unemployment for several years.

The GOP plan can be summarized as follows:


Limit the Federal Budget from Growing Faster than Family Budgets
Instead of spending money on wasteful programs under the guise of stimulus and investments, the GOP plan would seek to ensure that the federal budget cannot grow faster than families’ ability to pay the bill.

Provide Universal Access to Health Care and Secure Entitlements
With Democrats trying to sneak their disaterous overhaul of the medical system into law, the GOP offers "tax incentives for millions more working families and small-business owners to obtain access to coverage." The GOP plan would also let people "shop across state lines to purchase affordable policies that best meet their needs."

Lower Taxes
Instead of raising taxes on all Americans in the midst of a recession, the GOP plan replaces history's biggest spending spree with deep tax cuts, an economic jump-starter proven time and again. The plan would establish "a simple and fair tax code with a marginal tax rate for income up to $100,000 of 10%, and 25% for any income thereafter, with a generous standard deduction and personal exemption." Businesses with fewer than 500 employees would get a deduction of 20% of their income, so "these engines of growth will continue to fuel our economic recovery and companies can compete with their foreign counterparts, while keeping jobs here at home."

Keep Energy and Fuel Costs Low
Instead of a new national energy tax that will cost up to $3,128 per household, the GOP plan calls for energy independence with increased development of all our natural resources, including renewable energy sources such as wind and solar.

End the Bailouts and Reform the Financial System
Rather than nationalizing the private sector financial system and heaping trillions of dollars of debt on future generations, Republicans want to protect taxpayers and provide a transparent recovery process that does not favor those that have made unsound business decisions. We will ensure that this financial crisis can never occur again.

Keep the Cost of Living Low
Instead of a return to double digit levels of inflation and the failed economic policies of the 1970s, Republicans support maintaining the cost of living after witnessing the booms and busts triggered by loose monetary policy.

House Minority Leader John Boehner (R-OH) introduced the plan, directly accusing the president’s plan of being "anti-stimulus" and arguing that the GOP plan will "return fiscal sanity" to Washington. The complete alternative budget itself will be unveiled next week by Representative Paul Ryan (R-WI).

House Republicans know that Obama and the democratic congress will not be doing a 180 on economic policy and give the GOP plan serious thought. But they refuse to let the president suggest that adding trillions to the debt of future generations is the only way out of the current situation.