A newsletter covering budget reform and the latest news and views on the federal budget, published by The National Center for Public Policy Research, 20 F Street NW, Suite 700 , Washington, D.C. 20001, (202) 507-6398, Fax (301) 498-1301, E-mail BudgetWatch@nationalenter.org Web http://www.nationalcenter.org and the Small Business Survival Foundation, 1320 18th St. NW, Washington, D.C. 20036, (202)785-0238, Fax (202)822-8118, Web http://www.sbsc.org.
By 2005, the budget deficit will reach $454 billion, the national debt will grow another $3.3 trillion and interest payments on the debt will hit $412 billion, if current trends hold.
President Clinton's "almost doing nothing" approach would fare better, but still produce abysmal results. By 2005, the budget deficit would stand at $209 billion and the national debt would grow by another $2.3 trillion.
And just how do deficits affect average Americans? According to a Budget Committee report, interest payments are two percentage points higher today than they would be if the budget were balanced. That adds about $37,000 in interest payments over the life of a 30-year mortgage of $75,000. An increase of two percentage points also slows the economy, costing up to 4.25 million jobs over ten years, reducing per capita incomes by as much as 14%, and reducing federal and local and state tax revenues by $235 billion and $232 billion, respectively. These figures are based on current debt levels -- the adverse effect on American families and the economy will be even more dramatic if Congress does not act now to stop further deficit spending. Source: IMRA
*Hill Watch - Update on Hill Efforts for a Balanced Budget
House to Solicit Ideas from Private Sector:
Even during the July 4 recess, budget-conscious members of the House were working overtime to down-size and restructure the federal government. Representative Bill Clinger (R-PA), Chairman of the House Committee on Government Reform and Oversight, is planning the first in a series of regional meetings throughout the country to solicit ideas from the private sector and state and local governments to "create a new 21st Century Government." In early June, Speaker Newt Gingrich asked the committee to spearhead government reorganization efforts. Chairman Clinger and other committee members will be in Cleveland, Ohio on July 14 to hear success stories and testimony from witnesses on how to bring the government into the high-tech 90s while preparing for the next century. The hearing will include an open microphone session.
Waste Patrol - Where Government Can Slim Down
Department of Education Fails One of the Three "Rs" - arithmetic:
According to a study written by John Berthoud, Visiting Fellow at The Alexis de Tocqueville Institution, taxpayers could save at least $15.7 billion over a five-year period by abolishing the U.S. Department of Education. From 1970-1979, prior to the Department's creation, federal spending on education grew at approximately half the rate of other non-defense discretionary spending (35% compared to 65.7%). But since the department's creation, federal education spending has risen more than three times as fast as non-discretionary spending (29.5% compared to 7.9%). Simple arithmetic tells us it's time for the Department to go. For more information, contact The Alexis de Tocqueville Institution @ (703)351-4969.
Legal disServices Corporation:
The Legal Service Corporation (LSC), a program established in 1974 to provide legal services for the poor, has become a politicized government agency with its agenda set by "elite attorneys rather than the poor," according to Peter Flaherty, president of the National Legal and Policy Center. According to critics, LSC attorneys use taxpayer dollars to find more ways to spend taxpayer dollars -- those tracking LSC activities over the years show that the activities of the LSC have added $2 trillion on the taxpayers' tab. For example, taxpayer-susidized LSC attorneys in Massachusetts have developed a brochure for welfare recipients who may receive an unexpected cash windfall. The goal? To delay losing public assistance. "Prepay a portion of your rent or mortgage so that you can use the [welfare money] for other things. Buy a special gift, take a vacation...put the [windfall money] into savings," reads the brochure.
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