Wyoming Lawmakers Offer Explanations For Low Revenues And High Debt
The nation's treasury secretary initially thought lawmakers wouldn't have to raise the debt ceiling until October or November, but White House officials have moved that deadline to early September. That's because projected federal revenues are way down, according to the Bipartisan Policy Center, a wonky think tank that tries to avoid the partisan tit-for-tat that's come to mark contemporary politics.
That nonpartisan analysis doesn't sit well with Wyoming Senator Mike Enzi who chairs the Budget Committee. Enzi usually doesn't stop to talk to reporters in the Capitol's halls but he did when confronted with that analysis.
"Wait a minute, wait a minute, wait a minute, federal revenues are not down. Federal revenues are ahead. Unfortunately, spending is dramatically ahead. We're spending three times as much as the extra revenue that's coming in from the Tax Cuts and Jobs Act. We can't keep doing that," Enzi says.
Enzi says the case in point is the debate from earlier this summer over funding natural disasters.
"The disaster bill started at $13 billion at the beginning of the week. In order to buy enough votes, it got to $19.1 billion by the end of the week. That's three-months worth of revenue off of the increase in revenues," Enzi says.
Enzi's not alone. We hopped on the tram that runs underneath the Capitol with Wyoming junior senator John Barrasso and asked him why the Trump administration is rushing to make up for a short fall in federal revenues even after he and other party leaders promised revenues would go up under their tax cut package.
"It's not that we're taxed too little, it's that we spend too much. People in Wyoming understand that: we balance our budget every year in Wyoming. I think that we need a constitutional amendment to balance the budget, I support that. I've introduced and cosponsored it in the past. If the federal government ran the way Wyoming ran, it would be a lot better for the whole country," Barrasso says.
At the start of this year the Director of the nonpartisan Congressional Budget Office Keith Hall told lawmakers that the tax bill was falling short of GOP claims that it would pay for itself, which he has since reaffirmed.
"Obviously, projecting the future you can be wrong, we can be wrong. We did a really careful analysis of the tax bill. We looked at research. We tried to base it on real data, real evidence, and our estimate did in fact show that the GDP benefits of the tax bill would increase revenues, but not enough to fully cover the bill…and it covers about 30 percent of the tax bill, with respect to the deficit," Hall testified.
GOP leaders like Barrasso sold the sweeping tax cut package as a bill that didn't need to be offset elsewhere in the budget because they argued it would pay for itself. To Democrats, it doesn't take a rocket scientist to understand why there's been such a steep decline in revenue. Here's the ranking member on the Senate Appropriations Committee Patrick Leahy of Vermont.
"Well, one of the biggest reasons was of course the Trump tax cut and all that money didn't really create any new jobs. Corporations used it for stock buybacks, made a whole lot of people wealthy," Leahy says.
For more moderate Democrats, like Delaware Senator Tom Carper, it's not simply an either-or question.
"Do we need to watch the spending? Yes. Do we need more revenues? We need both," Carper says.
Carper says that's partly why the GOP needs to agree to hike taxes even just a tad, or else he knows his party won't budge on its preferred spending priorities.
"I think, at the end of the day, if we're serious about making progress we need both. And if it's not both, then there's not an incentive for the Democrats to go along," Carper says.
Partisan politics aside, Senator Enzi says he's working on potential budget reforms that could help avoid situations like this in the future. For years, he's pushed party leaders to move to two-year budgets, like they do in Wyoming, along with a number of other sweeping reform proposals. And now that Enzi is retiring, he says more lawmakers are willing to embrace some of his ideas.
"And I'm having some bipartisan success on that, maybe because I'm not running. Some of it probably won't take effect until after the next election. That's when neither side knows who the president is going be, nobody knows who the majority is going to be, so both sides are being reasonable. And it's the prime time to get something in place that will protect your generation and future generations from this heavily increasing debt," Enzi says.
While Enzi won't get into all of the specifics as negotiations are ongoing, he is vowing to leave Washington with a budgetary bang.
"I'm going to have to create a verbal crisis here to get my colleagues to come along," Enzi says. "And it's not just verbal, it's real."