Americans for Tax Reform Calls Paygo a Vote Against Taxpayers

One of the first House votes under Democratic leadership included the "Paygo" rule, which requires Congress to immediately identify new funds to pay for any new spending. Grover Norquist, president of ATR, calls this a license to raise taxes, as well as a prohibition on future tax cuts.

Simply put, PAYGO is measure designed to stop further tax cuts. Since 2003, more than $600 billion of tax cuts have been implemented which has worked to increase economic growth, job creation, investment, job creation, and household wealth. As a result of this growing economy tax revenues have soared witnessed by the past two fiscal years experiencing the two largest increases in federal tax revenues ever. PAYGO ends these pro-growth tax cuts.

Though Norquist says he supports earmark reform, which included in the same bill as paygo, he believes the two measures should have been voted on separately.

Republican members say that today's action - rules put in place by Democrats to shut Republicans out of the legislative process - signal how the Democratic leadership intends to conduct business. "This solidifies the fact that this is a closed shop," said Rep. Tom Price (R-Ga.).

The Democratic version of paygo eliminates the requirement of a 60% supermajority in order to raise taxes. The supermajority measure was adopted by Republicans in 1995.

(The Hill) "On the first day that Republicans took majority control of Congress in 1995, one of their first actions was to establish a protective rule requiring a 60 percent supermajority to approve federal tax increases," Minority Leader John Boehner (R-Ohio) said in a release. "On their first day in control of Congress in 2007, Democrats are blocking efforts to maintain that protection, making it easier to raise taxes."

ATR adds:

Simply put, PAYGO is measure designed to stop further tax cuts. Since 2003, more than $600 billion of tax cuts have been implemented which has worked to increase economic growth, job creation, investment, job creation, and household wealth. As a result of this growing economy tax revenues have soared witnessed by the past two fiscal years experiencing the two largest increases in federal tax revenues ever. PAYGO ends these pro-growth tax cuts.

At the same time, this provision does nothing to slow the growth of spending. PAYGO only applies when spending exceeds the baseline which is already growing due to rising entitlement costs. Pulling this altogether, PAYGO is a mechanism that will finance higher levels of spending with tax increases, while at the same time ending all tax cuts from here on in.

I guess the bright side is that Democrats are showing their colors from day one. Grist for the 2008 election mill.