MARCH 20, 2013 -- Senators are constantly leaving the Senate and finding fault. When I left in 2005, to retain credibility, I wrote a book Making Government Work. Then I wrote numerous articles and sent copies to all the Republicans and Democrats in the Senate to tell how we can compete in globalization and pay for government. Nothing happened.
At 91 years of age, I don't have long to tell it like it is, so I'll be direct. The President and the Congress have no idea of governing. They all play the game of: "I can do politics better than you can," refusing to pay for government, create jobs, compete in globalization and save the economy. The United States is in trouble.
to be conscientious about paying for government. We instituted the budget
process in 1973, balanced the Social Security Budget in 1983, cut spending
with Graham-Rudman-Hollings in 1985 and President George H.W. Bush broke
his pledge to help us pay for government in 1992. In 1993 Newt Gingrich
started his shenanigans, refusing to pay for government and attempting
to close down the government in 1996. In 1993, we Democrats cut spending
$250 billion and raised taxes $250 billion without a single Republican
vote in either the House or Senate. This gave the U.S. eight years of
the strongest economy and we gave President George W. Bush a balanced
budget in 2001. Then President Bush, Congressmen Boehner and Cantor cut
taxes, waged wars, added prescription drugs to Medicare, stimulated and
bailed out - all without paying for them. Boehner, Cantor and the Republicans
had eight years to cut spending, cut the size of government. Instead,
they increased the national debt $5 trillion and increased the size of
government. Now taking control of the House: "the government is too
big" and "spending is the problem". President Obama stimulated
the economy another $5 trillion in four years. The President and Congress
engage in a charade of governing with super committees, ten year plans
to cut trillions of dollars, debt ceilings, fiscal cliffs, sequesters,
and government closings. All they do is raise money for reelection. The
government is going out of business.
It takes private investment to build a strong economy. The President and Congress have the duty to develop a competitive economy for private investment like our Founding Fathers did with the enactment of the Tariff Act of 1787 - two years before the Constitution. Rather than invest offshore, Corporate America withholds almost $2 trillion in offshore profits hoping to repatriate the profits tax free to invest in the United States. It knows taxes are going up and awaits the President and Congress to determine the increase. The President and Congress can give Corporate America certainty by replacing the 35% Corporate Tax with a 7 % Value Added Tax. This immediately releases the offshore profits for Corporate America to invest in the United States and create millions of jobs. The CBO estimates the 2012 Corporate Tax produces revenues of $236.8 billion. A 7% VAT for 2012 would have produced $922.5 billion in revenues - producing billions to balance the budget in two years rather than ten. Since the VAT has no loopholes, and is self-enforcing, we have instant tax reform and can cut the size of government - IRS. Since Main Street or small business is paying the full 35%, this tax cut helps small business. Then President Obama can give Corporate America certainty that its production will be protected by enforcing our trade laws. If President Obama enforced the Defense Production Act of 1950, like President Kennedy in 1961, we wouldn't be begging Russia for helicopters for Afghanistan and it would create millions of jobs. If President Obama protected steel, motor vehicles, computers and machine tools like President Reagan in 1984, we could create millions of jobs.
Republican and Democrat Senators started raising money against each other,
they wheeled and dealed and fixed the vote. Today, lobbyist's wheel and
deal. They know which lobbyist can influence a particular Senators vote
and the vote is fixed long before the Roll is called. In fact, they tell
the Leader when to call the Roll. Lyndon Johnson couldn't lead the Senate
today. Lobbyists control. Wall Street, the big banks, Corporate America
and the U.S. Chamber of Commerce cry "Free Trade!", "Protectionism!"
as they develop China's controlled market while their lobbyists oppose
our trade laws and the VAT tax cut. Their lobbyists contribute to the
President and Congress to do nothing. Yet, people wonder why nothing gets
done in Washington.
Senator Hollings of South Carolina served 38 years in the United States Senate, and for many years was Chairman of the Commerce, Space, Science & Transportation Committee. He is the author of Making Government Work (University of South Carolina Press, 2008).
© 2013, Ernest F. Hollings. All rights reserved. Contact us for republication permission.
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