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Republican senator Mike Lee introduces bill to cut taxes on parents

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National Review reports on a new tax cut plan from Republican senator Mike Lee.

Excerpt:

Today at AEI, Senator Mike Lee of Utah introduced an idea that’s been missing in Congress for a long time: A conservative tax-reform plan that aims to improve opportunity and reduce the bias against families inherent in the U.S. tax code.

It would significantly simplify how individual income taxes work, and result in a large tax cut on families with children, especially married ones: The system would be reduced to just two brackets — 15 percent on all income below $87,850 (at which the rate currently jumps from 25 percent to 28 percent) and 35 percent on all income above that. Most interestingly, though, it would provide much more compensation in the tax code for raising children: “The centerpiece” of the plan, as Lee put it, is a $2,500 tax credit per child under the age of 16, which would reduce what parents owe in income taxes dollar-for-dollar, and if that’s reduced to zero, what they owe in payroll taxes, too. (The tax code currently provides a combination of a tax deduction for children, which only reduces the amount of one’s income that’s subject to the income tax and isn’t, for most couples, nearly as valuable per dollar, and a smaller tax credit.)

That represents a significant tax cut on a lot of middle-income earners, but a number of tax expenditures (deductions and credits) would be eliminated, and some would be smartly restricted — the mortgage-interest deduction, for instance, would be capped at $300,000 in principal, as Lee says, “focusing the deduction on the families and communities who need it the most.” He highlights a “new charitable deduction that would be available to all taxpayers,” which would be available to people who don’t currently itemize their deductions (lower-income Americans, for one). The “marriage penalty” would be eliminated, because the bracket sizes would now just be doubled for married couples (preserving a “marriage bonus” for many couples).

[…]The plan hasn’t been scored for its revenue effects, but it seems likely, overall, to reduce the receipts of the federal income tax slightly. Over the long term, though, while this isn’t the main intent, a rise in fertility and increased investment in raising children should go a ways to reducing America’s long-term fiscal gap (AEI’s Jim Pethokoukis likes to refer to such an idea as a “human-capital tax cut” — while, again, it’s about fixing a distortion in the tax code and not adding one, at the margins it’s a big tax cut for having children).

So often on this blog, I post articles critical of Democrats, but not much about what Republicans want to do. Here’s an example of what Republicans want to do.

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Governor Bobby Jindal’s fight to give poor, minority children quality education

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Here’s an update on the Democrat war on vouchers in Louisiana, posted by governor Bobby Jindal in the left-leaning Washington Post. In it, he explains how is trying to reform education in his home state of Louisiana, and how the federal government is trying to stop him for doing that.

Excerpt:

We all know the harsh cycle of poverty that exists in the United States and that a disproportionate share of those in poverty are minorities. Studies of health-care outcomes, incarceration levels and economic opportunity all show that education is key to improving quality of life.

Millions of single parents in this country work two jobs to make ends meet, hoping that their children won’t have the same struggles. Hope is their only option because they live in neighborhoods with chronically failing public schools and lack the means to move to better school districts or to send their children to private schools.

Obama and Holder think this should continue to be the reality. In Louisiana, we think the opposite is true. We believe every child deserves the opportunity to get a great education.

That’s why we started a school choice program in 2008 in New Orleans and expanded it statewide in 2012. Low-income families with children in schools graded C, D or F by the state are eligible to apply for a scholarship and send their children to schools of their choice.

The program works. From 2011 to 2013, students who had been trapped in failing schools and now attend scholarship schools showed improvement on literacy and math tests. The share of students performing at grade level rose 7 percent, state data show, even though in 2013, 60 percent of students taking the test had been in their new schools for only eight months. More than 90 percent of parents of students participating in the program reported satisfaction with their children’s schools.

This opportunity is perhaps these children’s best chance to escape the cycle of poverty. No one in their right mind could argue that the Justice Department’s efforts to block the scholarship program will help these kids. This can only be an attempt to curry favor with the government unions that provide financial largess and political power.

President Obama should do the right thing and order the Justice Department to drop the lawsuit. Not because I am asking, but because the parents and children in the scholarship program deserve an opportunity. For generations, the government has forced these families to hope for the best from failing schools. Shame on all of us for standing by and watching generations of children stay in failing schools that may have led them to lives of poverty.

We in Louisiana are rejecting the status quo because we believe every child should have the opportunity to succeed. A scholarship program is not a silver bullet for student success. Maybe a student will perform well in a traditional public school, or a charter school, or a virtual school, but the point is that parents should be able to decide, not bureaucrats in Baton Rouge or Washington.

If the president and the attorney general believe their path is right, I invite them to come to Louisiana and look these parents and children in the eyes and explain why they believe every child shouldn’t have a fair shake.

If the administration does not drop this lawsuit, we will fight every step of the way until the children prevail. Giving every child — no matter race or income — the opportunity to get a great education is a moral imperative.

You might remember that the Obama administration previously went after the D.C. voucher program, which was also for helping poor, minority students.  Why are the Democrats doing this? The answer is simple. Come election time, the Democrats rely heavily on the fundraising and activism of the teacher unions. The teacher unions have more money if they have more children trapped in their failing public schools. Therefore, Obama has every incentive to make sure that no child is allowed to leave a failing school. He needs the help of the teacher unions at election time more than he needs to help children who cannot even vote. That’s what is really going on here. Bobby Jindal would love to have the support of teacher unions, but given the choice between helping the unions and helping the children, he’s choosing the children.

The main point here is that the politicians who talk the most about spending more money on education may not be thinking about what is best for children at all. They might be thinking about paying their union supporters more, so that they will do more at election time. An alternative to just giving more money to the unions would be Jindal’s plan of giving money directly to parents and letting parents choose. Parents might not be as politically connected as teacher unions, but if your goal is to help children get an education, then maybe unions and elections don’t matter as much.

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How governor Rick Scott created jobs and eliminated a $3.5 billion debt in Florida

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This post at A View From The Right had the full transcript of the Florida governor’s recent speech at the recent “Defending the American Dream Summit”. I thought it was interesting to see what he was doing, since I have sort of been neglecting him and concentrating my attention on other Republican governors like Scott Walker, John Kasich, Bobby Jindal and Mike Pence.

He inherited a bad situation from his predecessor:

In 2010, our state was in a free fall. We had lost more than 800,000 jobs during the four years before I took office. Our real estate market had collapsed. Our state debt had grown by about a billion dollars a year for two decades. And, thousands of government regulations were killing job creation.

[…]DC’s spending addiction had spread to Florida. Hard decisions had been delayed and replaced with the shortsighted policies of more debt and more spending. Florida was in a hole, and for about four years the state just kept digging.

When I took office, the bill had come due.

It was time to stop digging and climb out of the hole. We knew the only way out was to create jobs. Taxes are primarily paid by successful companies and people with jobs. In Florida, it was time to make the hard decisions to: Right-size government. Reduce spending. And pay down debt.

Here’s some of what the Scott administration has done:

I took office with a projected $3.6 billion budget gap. As we made the hard decisions to live within our means during my first year in office, there was plenty of criticism to go around. We streamlined services and targeted reforms to help businesses compete. But, we heard from the critics when we turned down stimulus funds and balanced the budget. They said, federal money was “free.” I was told to grab all the free federal money I could.

As part of our effort to reduce fraud and help families, we also passed legislation requiring drug testing for welfare recipients. The critics were mad. They said that drug testing someone applying for welfare was a violation of their rights. I disagree. Welfare is designed to support children, and parents receiving government assistance should be drug free. Illegal drug use has no place in any family. Unfortunately, this reform is still stuck in the courts. But, we will keep fighting.

To further reduce government waste, we reformed our unemployment assistance program. Federal unemployment money was pouring out of DC, but there wasn’t enough oversight in place to limit waste and abuse. We passed a law to require people on unemployment to show they were actively seeking a job every week.

And more:

I have now been in office for more than two years and we are beginning to see the results of conservative, pro-growth solutions in Florida:

*  We have turned around a four-year record of 800,000 lost jobs before I took office, and the private sector in Florida has now created nearly 370,000 jobs over the last 2 1/2 years.

*  Our unemployment rate has dropped below the national average, and Florida’s rate has had the second biggest improvement in the country.

*  We have paid off $3.5 billion in state debt.

*  We have downsized our state government workforce to the lowest level in the history of Florida. Why? Because the private sector is the engine to job creation -– not government.

*  We have eliminated more than 2,600 state regulations on job creators.

*  We paid back $3.5 billion in federal loans for re-employment assistance.

*  And, we did all this while also cutting taxes five times in three years, including: The elimination of the sales tax on manufacturing equipment to help jump-start manufacturing investment. Continuing to roll back the business tax, so that today around 70 percent of our businesses no longer pay it. And, we cut property taxes for homeowners and businesses.

[…]*  After right-sizing government and cutting taxes, this year, we had our first budget surplus in six years. But, it gets better.

*  Just a few weeks ago, our State Revenue Estimating Conference announced that the general revenue now forecasted for 2014-2015 in Florida will be the highest ever. The highest ever.

How are they doing it? With big government spending on “stimulus” programs? No:

Working with the Florida Legislature, we have cut taxes year after year, even while forcing government to live within its means. This year, we are committed to returning even more money to the hard-working Florida families who earn it. I look forward to working with our friends in the Florida Legislature to make these tax cuts a reality.

They are cutting government spending and returning the taxes to the taxpayers. This is a good state to be in now, especially if you want to run your own business. What I liked about the speech is that he is passionate about pro-growth policies. While others seemed to be ashamed of low taxes and small government, Governor Scott is producing results and linking those good results to his conservative policies. I think that the next time we have an election, it should be about choosing the person who has proven that they know how to run an economy. Governor Scott should be in the mix. The best stimulus program is a job, and we should be picking people who have proven that they know how to create jobs.