Blackburn holds Town Hall meeting with Chamber members
By Carole Robinson, Staff Writer
Cong. Marsha Blackburn uses a slideshow to present information to members of the Williamson County Chamber of Commerce during Friday's Town Hall meeting.
Cong. Marsha Blackburn met with members of the Williamson County Chamber of Commerce who were eager for news from Washington.
Using charts on a big screen, Blackburn held her “Budget School” with about 60 business leaders schooling them about the long road the nation has been traveling to the “Fiscal Cliff” and proposals made to avoid going over the cliff.
“We did not get here with fiscal problems overnight,” she said. “It took decades to make them.”
The cost of waiting to breach a widening fiscal gap of unfunded promises that, if not checked soon, may mean bankruptcy for the nation and has grown from $62.9 trillion in 2009 to $99.6 trillion in 2011.
According to Blackburn, raising taxes is not the answer.
With the Bush tax cuts, “We reduced the burden of taxation,” she said. “Making certain rates low equals more economic growth and more revenue. It’s an economic principle that has proven itself to be true. What we should have done as well was reduce spending. We can not spend our way to prosperity.”
Increasing tax rates does not increase tax revenue, it reduces revenue, she said pointing to a graph correlating tax rates and revenue to the Gross Domestic Product (GDP) from 1950 to 2005.
While tax revenue from 1947 to 2077 hovers between 15 and 20 percent of the economy, spending during that time rose as high as 23 percent in the late 1970s through the early 1980s, began dipping in 1987 and was below 20 percent by 1997. In 2007 government spending rose back up to 20 percent and by 2012 reached 25 percent of GDP. By 2077, if the nation continues on this spending high, the CBO projects spending will reach 80 percent of GDP.
“We are in a spending-driven debt crisis,” Blackburn said.
Raising taxes is not the answer, she added.
“Raising taxes on the top two percent [of tax payers] isn’t going to help at all. Two percent of what you need means we’re still running a $4 billion a day deficit. That two percent will only pay for eight days of government. The spending is what we have to get under control.”
Blackburn added the nation couldn’t sustain 25 percent of the GDP being spent by the government.
The Budget Control Act of 2011 increased the nation’s debt limit while imposing measures to limit spending and decrease the national debt.
With the first $900 billion of the debt increase, came a $900 billion cap in discretionary spending. The so-called Super Committee was charged with finding an additional $1.5 trillion in savings over 10 years before the second installment. Failing to do that triggered sequestration, which goes into effect Jan. 2, 2013.
Sequestration automatically reduces the defense budget an additional $55 billion per year above the cuts made by the BCA leaving the military with the smallest ground force since 1940.
It also affects non-defense programs like Medicaid, which will see $16.4 billion in cuts and the loss of hundreds of thousands of jobs.
The House passed the Sequester Reconciliation Act in May to implement mandatory spending reductions to discretionary spending that replace cuts in the defense accounts.
It also passed a pathway to job creation plan – a pro-growth tax reform that flattens and lowers tax rates, reduces spending and mandates to cities and states and extends current tax rates one year to allow the development of the new tax code.
“We need to bring the government in line,” Blackburn said. “Let’s deal with this now and be fair to our children and grandchildren, not leave it to them to deal with.”
Chamber members questioned how the problem could be dealt with when the House, the Senate and the President are at a stalemate.
Posted on: 12/19/2012