Washington, D.C. – Citizens Against Government Waste (CAGW) today highlighted, from the taxpayers’ perspective, the good and bad from President Bush’s $2.9 trillion fiscal 2008 budget request.

Good

Spending cuts.  The President proposes reducing or eliminating funding for 141 programs, saving $12 billion over five years.  CAGW’s Prime Cuts 2007 will offer 602 recommendations for saving $1.7 trillion over five years.  The Government Accountability Office just released its report on “high-risk” programs.  With so many resources at its disposal, Congress has no excuse for failing to identify and eliminate wasteful spending.     

Tax cuts.  The budget includes plans to make the tax cuts permanent.  The 2001, 2003, and 2004 tax cuts gave workers much-needed relief and helped to stimulate the economy.  Congress must balance the budget by cutting spending, not raising taxes; failing to extend tax cuts is a tax increase. 

Entitlements.  President Bush proposes $95.9 billion in savings over the next five years in mandatory spending, $66 billion of which would come from Medicare by slowing the growth of payments to hospitals and health care providers and increasing premiums for those with higher incomes.  Congress and the President must begin making the hard choices that are necessary to get runaway entitlement spending under control.  

Budget reform.  The budget calls for earmark reforms such as the line-item veto, prohibiting the addition of projects to conference reports, and cutting the number of projects in half.  The President has also spelled out his requests for war funding in the regular budget instead of relying on emergency supplemental bills.  All of these reforms add transparency and accountability to the budget process.

Bad

Alternative Minimum Tax (AMT).  The budget request includes a one-year fix for the AMT, which was never indexed for inflation and threatens to hit a larger share of the middle class every year.  Relying on short-term fixes is a shell game that allows policy makers to make long-term budget forecasts look rosier than they truly are. 

Energy.  Three decades of generous subsidies and tax incentives have failed to make alternative energy sources economically viable.  The President requests $9 billion in loan guarantees for alternative energy and $2.7 billion to fund advanced technologies.  These policies will raise prices, increase dependency on federal handouts, and have a minimal effect on foreign oil dependency.  The free market, not the government, should decide which energy products and services are most efficient.

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