-- Randy's Roundup --

A Weekly Newsletter from Congressman Randy Neugebauer

September 3, 2012

Falling Off a Fiscal Cliff

In recent months, you may have heard media commentators talking about a fiscal cliff.  You are probably asking, what is this “fiscal cliff” and what does it mean to my family or business?  Let me explain.  Fiscal cliff is the name being given to several policies affecting our federal spending and tax rates that are set to change or expire on January 1, 2013.  These policies, without any change from their current path, will have a dramatic effect on our economy. 

What are the policies that make up this fiscal cliff? The first component is mandatory, across-the-board government spending cuts which will take effect on January 1, 2013. These cuts were enacted into law as part of the 2011 Budget Control Act. You may remember the debate over that law as a part of the discussion about raising the national debt limit. In conjunction with raising the debt limit, the Budget Control Act also required Congress to produce significant budget cuts through what was known as the Super Committee. The Budget Control Act also put a backstop in place if the Super Committee failed to make those cuts, which it did. Under a process called sequestration, $1.2 trillion in what is known as mandatory government spending will automatically be cut over the next 10 years starting in January of 2013. Roughly half of the cuts will come from defense spending with the remainder from other government programs. Without a change in direction, these cuts will severely and unfairly target our national defense.

The second part of the “fiscal cliff”  also takes place on January 1, 2013 when the 2001 and 2003 tax cuts expire.  These tax cuts include:  lower income tax rates, death tax, marriage tax relief and the child tax credit.  If these tax cuts expire, everyone who pays taxes will see their rates rise – families and small businesses.  For instance, if you pay 25% in federal taxes now, you’ll pay 28% if these expire.  The 10% tax rate will disappear.  Small businesses—many of which file taxes as individuals—could pay almost 40% in taxes if these cuts expire.  The tax burden on each family or business will likely increase by hundreds or thousands of dollars each year.

Together, the spending cuts and tax increases will severely jolt our economy.  The non-partisan Congressional Budget Office estimates that the unemployment rate will increase to 9% in less than a year if Congress does not act before the end of 2012.  The good news is that we know the cliff is up ahead, and we have the ability to address it on our own terms.  In August, the House passed a bill to extend our current tax rates for one year while emphasizing the need for tax reform that simplifies the tax code.  We’re also working to ensure government spending cuts are targeted to maximize deficit reduction without hurting our national security.  This fall, I’ll be working to turn our country away from this fiscal cliff, and I’ll keep you posted on our progress in this newsletter.

Texas Voter ID Law Struck Down by Federal Court

Last week, a federal court blocked a Texas voter ID law that would require individuals to show official identification, like a driver’s license or passport, before being allowed to vote. I am deeply disappointed with the court’s decision to block this law, which was passed by the Texas legislature, signed by Governor Perry, and clearly reflects the will of Texans. If citizens are required to show identification to open a bank account, board a plane, drive a car or carry a concealed handgun, why wouldn’t voters do the same before exercising one of our most valuable rights as Americans? The right to vote by secret ballot is the foundation of our democracy, and no American should ever be denied that right. But it is also important that we don’t allow that privilege to be tainted by fraud.  An ID law that ensures one vote for every citizen would help ensure our democracy functions as the founders intended. Texas Attorney General Greg Abbott has pledged to take this case to the Supreme Court, and as this case moves forward, I will continue to support justice and fairness in our voting system.

Dyess AFB Welcomes its 22nd C-130J

Last week, the 317th Airlift Group at Dyess Air Force Base in Abilene, TX became the proud home of its 22nd C-130J. Dyess is scheduled to receive six more C-130Js, which are more modern and have more advanced capabilities than the C-130H they are replacing. These next generation aircraft are a product of advanced technology and infrastructure that ensure the superiority of the U.S. Air Force and the American military as a whole. Every day, Dyess men and women play an essential role in the defense of this great nation. Whether it’s 3,000 consecutive days of deployment by the busiest C-130 unit in the Air Force, or 10,000 combat missions by the B-1 Bomber—the workhorse of the bomber fleet—our troops on the ground don’t have to look up at the sky for long before they’ll see a plane from Abilene, Texas.

Action Item of the Week

Today is Labor Day, a day that pays tribute to the contributions and achievements of American workers. In honor of this day, I want to thank all the workers, farmers, small business owners, teachers, contractors, nurses and everyone who works hard every day to build a better life for themselves and their families. I am a strong advocate for individuals who work hard and embody the spirit of ingenuity and individuality that defines us as a country. I wish you and your family an enjoyable holiday. Happy Labor Day.