The Circus Distracted Us While Congress Pillaged the Country

With the country hypnotized and obsessed by drinking habits and words I had never heard before (Thanks for the education!), we are paying no attention to the terrible bills that are being pushed through Congress by irresponsible legislators on both side of the aisle. Here are a few.

Remember when Republicans under the previous President fought for some semblance of fiscal responsibility and for a return to regular order in the budget-making process? That time is long gone. Last year they passed a tax bill, which in spite of some important provisions – such as the reduction of the corporate income-tax rate and the reduction of the state and local tax deductions – was very much fiscally irresponsible. Revenue lost to this cut in tax rates was assumed to be recovered through economic growth and (of course) more debt.

As much as I love lower taxes, I also understand that Nobel economist Milton Friedman was right when he said that the true size of government is measured by how much it spends rather than by how much taxes we pay.

Unfortunately, legislators not only refused to couple the most-recent tax cuts with spending cuts in order to avoid pushing more debt down the throats of future generations, they also justified tax-cut provisions known for their inability to grow the economy – such as the doubling of the standard deduction – by saying that the American people deserved tax cuts.

However, if there’s no cut in spending, the fiscal cost of government will have to be paid.

Well, now they are back at it. On September 28th, the House passed a bill to cut taxes again, casually called Tax Reform 2.0. While it has no chance of getting through the Senate, this bill is a sign that Republicans have a deep misunderstanding of fiscal responsibility. It also exposes as a sham their stated belief in smaller government. As last year, there is in this bill no mention of cutting spending.

In fact, Republicans are doubling down on their spending addiction by voting for this $850 billion spending bill that covers only 65 percent of discretionary spending.

In a rare action of bipartisanship—which once again proves that bipartisanship should be feared by those of us who believe in smaller government—the Democrats and Republicans jointly embraced increased spending on everything, as well as another successful effort to bust spending caps on defense and nondefense spending. (The Senate voted 93-7 in favor of the bill and the House passed it by a vote of 361 to 61.)

Granted, most of the harm was already done when the bipartisan mob agreed to the higher spending by voting last February for the Bipartisan Budget Act of 2018. This move further eroded 2011's fiscal restraints while growing the debt by an additional $300 billion.

House Republican Justin Amash (R-MI) wasn’t amused. He took to Twitter to vent that “$850 BILLION of spending in one year in one bill—and Republican leaders have been bragging to everyone about this massive spending increase. Vote is TODAY. The same Republicans who used to blast GWB’s spendthrift GOP have become far worse than the politicians they once derided.”

While they were at it, the Senate passed an earmark-riddled 1,200 page Federal Aviation Authorization bill by a large 93 to 6 vote margin. And what an accomplishment. Among its many other paternalist idiocies, this bill prohibits cellphone calls on planes, forces airlines to allow passengers to check strollers when flying with small children, and requires that pregnant passengers be allowed to board ahead of others.

The FAA will also have to provide more regulation on drones, give increased grants to airports, and study “cockpit security, [to] consid[er] whether a protective screen might be put in place when pilots use the restroom at the front of the plane.”

And then there’s the “Build Act,” which provides yet another clue that legislators understand nothing about how the market works. You see, authoritarian China is investing a ton of money on infrastructure abroad – a fact that, according to our leaders supposedly gives to the Chinese vast comparative advantages over Americans.

Forgot about all that we know about how government investments suffer from bad incentives and the lack of market signals and, as a result, generated malinvestments and other distortions. China is doing it and so we have to respond with our own nonmarket program. Crazy.

To achieve their misguided goals legislators picked the perfect crony program: The Overseas Private Investment Corporation (OPIC), a federal agency that subsidizes U.S.-owned overseas businesses with taxpayer-backed financing.

For years, the agency has been ripe for termination but continued to live on. Now it has been not only revamped, the Senate has voted to double its funding. Under its new name - the U.S. International Development Finance Corp. - this crony agency will supply the U.S version of China’s predatory development loans.

They have also passed a bill to expand the battering ram on civil liberties that is the Patriot Act. This expansion is done in the name of ending sex trafficking. As Amash notes, "GOP leaders put 'Fight Human Trafficking' in the title to conceal the bill's true purpose: to give the government more power to unconstitutionally spy on law-abiding Americans without a warrant." As Elizabeth Nolan Brown writes:

“ H.R. 6729 would allow financial institutions, federal regulatory bodies, nonprofit organizations, and law enforcement to share customer bank records between them without running afoul of rules regarding consumer privacy and without opening themselves up to lawsuits. Ostensibly, this would be done "in order to better identify and report potential human trafficking or money laundering activities." But these entities need not demonstrate that the "sharing was made on a good faith basis," according to the current text of the bill.

But rest assured, Congress also voted for a resolution criticizing San Francisco for how it conducts school-board elections. Way to go!

An action such as this one would be funny if this small sample of the disgusting legislation that got approved by Congress without anyone caring weren’t tragic for those of us who want smaller government. You can now go back to talking about drinking while in high school.

 

Sign up here to be notified of new articles from Veronique de Rugy and AIER.

Veronique de Rugy

AIER Senior Fellow Veronique de Rugy is also a Senior Research Fellow at the Mercatus Center at George Mason University and a nationally syndicated columnist. Her primary research interests include the US economy, the federal budget, homeland security, taxation, tax competition, and financial privacy.