Republicans Shrug Off Deficit Woes In Half-Trillion-Dollar Binge

Republicans in the U.S. Congress who came to power pledging tight-fisted budgeting are going on a tax-cut and spending binge that would boost federal deficits by a half-trillion dollars.

In part, they’re doing it by sidestepping their own warnings about the perils of ringing up even more national debt. Instead, they’re choosing tax cuts and the promise of long-term savings -- and some of the Tea Party members who came to Congress on the pay-as-you-go promise are going along.

So are some Democrats, but it’s the Republican majority that has pushed these bills forward for a mix of motives -- to show voters they can cut taxes and get things done, and to avoid looking like the Party of No. Even some Republicans say it’s wrong.

“How are you going to balance the budget when you are spending all of this money?” said Republican Walter Jones, a North Carolina Republican. “We were the party that advocated less government and less spending. We aren’t keeping our promise.”

Stan Collender, a budget expert and executive vice president of Qorvis MSLGroup, put it simply: “Hypocrisy, or worse.”

Republicans say they’ll balance their budget with $5 trillion in cuts over 10 years, yet budget experts say the damage is done.

“They clearly are a party in conflict with themselves,” says Joel Friedman, vice president for federal fiscal policy at the Center on Budget and Policy Priorities, a Washington group that advocates for the needs of low-income Americans.

Tax Breaks

The House last week voted to repeal the estate tax, paid by only 0.2 percent of U.S. estates, and to permanently extend tax deductions for state and local sales taxes -- without offsetting the cost of either measure. Those moves would combine to expand the deficit by $311 billion over 10 years.

Another $141 billion will be added over 10 years in a measure signed by President Barack Obama last week that leaders of both parties touted as a sign of getting something done in Congress. The law will permanently fix how physicians who treat Medicare patients are paid. The measure also included a two-year extension of the Children’s Health Insurance Program past its current Sept. 30 expiration.

Other deficit-expanding moves include House passage of a bill to revive a lapsed tax break for small businesses that encourages them to purchase equipment, which combined with other language would cost the government $79 billion over a decade in forgone revenue.