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In the coming weeks, Congress will be talking a lot about the future of America’s economy and what it will take to get our economy back on track. The Democrats have offered legislation (H.R. 1) with a price tag of $825 Billion dollars, which for the most part, is a borrow and spend approach.

You can read all 647 pages for yourself right here.


Some Highlights of H.R. 1:

- EVERY DOLLAR of this “stimulus” is borrowed. We are asking our kids and grandkids to pay for this.

- There are 32 new programs totaling $136 Billion.

- Not one nickel of this “stimulus” is used to protect America’s national security. There is no new national defense spending in this bill.

- This legislation would increase the national debt by 8%.

- This legislation is equal to 28% of all federal spending in 2008.

- According to the Congressional Budget Office, just 7% or $26 Billion will be spent in 2009. And only 38% will be in the first two years.

- While the press releases touting the plan highlight the importance of shovel-ready projects, only 5% of the total $825 Billion package goes toward transportation infrastructure.

- $54 Billion goes to programs that the Office of Management and Budget has deemed “ineffective” or has not been able to show a result for the money spent.

- The Tax provisions increase outlays from the IRS by more than $80 Billion – much of it through a transfer of wealth by sending checks to millions of Americans who pay no federal income tax. Sending money to people who don’t pay taxes used to be called welfare, now it’s called a “tax cut”.

- This legislation fails to address the Alternative Minimum Tax liability which will mean roughly 24 million middle-class families will owe more taxes at the end of the year.

- H.R. 1 includes $350 million for STD prevention and education at the Centers for Disease Control and Prevention.


Are there any alternative plans? Yes, Congressman Posey has joined in introducing a plan called the American Recovery Effort (H.R. 470) which cuts taxes for all taxpayers and small businesses.

Read the text of the American Recovery Effort (H.R. 470).
 
The Heritage Foundation has an interesting report on how repealing capital gains and dividend taxes creates jobs and encourages investment in America.

Some Highlights of American Recovery Effort:

- This bill provides fast acting tax relief vs. the slow burn, big government spending of the Democrat legislation.

- Rather than sending checks to those who pay no taxes, the American Recovery Effort reduces the lowest individual tax rates from 15% to 10% and from 10% to 5%. As a result every taxpaying-family in America will see an immediate increase in their income with an average benefit of $500 in tax relief from the drop in the 10% bracket and $1,200 for the drop in the 15% bracket. A married couple filing jointly could see their federal tax bill cut by $3,200 this year.

- Small businesses (those employing fewer than 500 individuals) employ about half of all Americans and create 70% of all new jobs, yet they can be subject to tax rates that siphon away one-third or more of their income. H. R. 470 allows small businesses to take a tax deduction equal to 20% of their income. This will immediately free up funds for small businesses to retain and hire new employees, purchase new equipment and expand operations.

- The real-estate market is paralyzed as potential buyers sit on the sidelines waiting for prices to fall even further. This is becoming a self-fulfilling prophecy. In order to encourage responsible buyers to enter the market and stabilize prices, the bill I cosponsored provides a home-buyers credit of $7,500 for those buyers who can make a minimum down-payment of 5%.