Washington, D.C. – Citizens Against Government Waste (CAGW) today blasted Senate Budget Committee Chairman Kent Conrad’s (D-N.D.) budget proposal.  Senate Democrats plan to raise taxes and spending without cutting wasteful programs while ignoring the increasing costs of entitlements.

“This plan is fiscally irresponsible and economically unsound,” said CAGW President Tom Schatz.

Sen. Conrad claims that his budget will produce a surplus by 2012 without raising taxes.  However, his projections assume the Bush tax cuts will expire in 2010, which in effect raises taxes.  He leaves open the possibility of extending the tax cuts if they are paid for, but does not elaborate as to how that would be accomplished.  Allowing the tax cuts to expire will create the biggest tax increase in history: $900 billion.

Senate Democrats rejected President Bush’s proposals to cut or eliminate 141 programs to save $12 billion over five years.  Congress has no excuse for failing to identify and eliminate wasteful spending.  CAGW’s annual Prime Cuts 2007, to be released in April, will offer 602 recommendations for saving $1.7 trillion over five years. 

Under Sen. Conrad’s plan, domestic agencies would receive an average annual budget increase of almost 5 percent.  The budget includes an additional $6 billion for education and $3.5 billion for veterans’ health care over the president’s request. 

To offset this increased spending, the plan aims to increase government revenue by closing the so-called tax gap and offshore tax loopholes.  However, many Democrats are opposed to the use of private collection agencies – the most efficient and cost-effective way to collect taxes owed to the IRS.  Furthermore, it would be far more productive to create a friendlier business climate by lowering the corporate tax rate so that companies migrate to, rather than leave, the United States.  Simply put, the Democrats’ proposals will fail to offset the new spending. 

Most alarmingly, the budget ignores the approaching tidal wave of entitlement spending, allowing it to grow until it eventually crashes on future generations; entitlement spending will reach 20 percent of the gross national product by 2050.  After rejecting President Bush’s plan to save $95.9 billion in mandatory spending over five years, Democrats have no plan of their own to confront stark budget realities.  

Sen. Conrad only slightly improves upon President Bush’s one-year Alternative Minimum Tax (AMT) solution with a two-year fix.  Short-term AMT relief allows policy makers to make rosier budget forecasts based on false assumptions.       

“With a massive tax hike, spending increases without any spending cuts, and no long-term budget solutions, this budget is a bust for American taxpayers.  Clearly, Democrats are not delivering on their campaign promise to bring fiscal responsibility to Washington,” Schatz concluded.

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, mismanagement and abuse in government.