GOP’s plan to save Israel would cause America’s debt to balloon significantly – The plan proposed by House Republicans to fund aid to Israel by cutting the budget for the Internal Revenue Service (IRS) is a bad idea, according to experts, who warn that going forward with such a plan could further balloon the U.S.’ debt by billions of dollars over time.
Government spending has been a critical issue of contention between the Republican and Democrat factions in Congress, with conservatives pushing the federal government to enact more belt-tightening measures.
Seemingly emboldened and energized by the election of a new Speaker, GOP members in the House have put forward a bill that proposes to slash the IRS’ budget by a staggering $14.3 billion.
Experts warn, however, that doing so could cause the national debt to increase by more than $30 billion within the next ten years after such a plan is implemented.
In a statement, Maya MacGuineas, president of the Committee for a Responsible Federal Budget (CRFB) said, “Paying for new spending by defunding tax enforcement is worse than not paying for it at all.”
“Instead of avoiding new borrowing, this plan doubles down on it,” she added.
The budget cut to the IRS would also severely hamper its activities to close the “tax gap” – which refers to the hundreds of billions of dollars owed to the government annually that the government fails to take in.
MacGuineas’s statements were echoed by Howard Gleckman from the Urban-Brookings Tax Policy Center at the Urban Institute, who said that “cutting this kind of IRS funding would actually increase the deficit.” Gleckman, a senior fellow at the Institute, explained that, “Instead of being an offset, it (the IRS budget cut) would actually make matters worse. The general rule of thumb that the budget scorekeepers use is it’s about 2-to-1. So if you cut IRS funding (by $14 billion to $15 billion), you’re actually going to increase the deficit by about $30 billion.”
A report released by the Congressional Budget Office (CBO) estimated that the increase in deficit caused by a cut to the IRS budget at $24 billion over ten years, while at the same time cutting government revenue by as much as $49 million over the same period. In contrast, increasing the IRS’ budget by $80 billion would enable the deficit to go down by more than $100 billion due to the tax agency’s improved collection and enforcement capabilities, according to the CBO.
The CBO is a non-partisan governmental agency tasked with looking at how bills put forward in the legislature affect the national deficit.
On top of expert opinion, the bill from the GOP will also have to contend with the Democratic majority in the Senate. Senate Majority Leader Chuck Schumer reported said of the bill, “It’s dead before it’s even voted on,” and calling the House Republicans’ bill “a joke.”
Tim Ramos has written for various publications, corporations, and organizations – covering everything from finance, politics, travel, entertainment, and sports – in Asia and the U.S. for more than 10 years.
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