We cannot continue to kick the can down the road on our national debt. It now exceeds $20 trillion, which equates to more than $60,000 for every American citizen. In the last eight years alone, the debt swelled by $9 trillion.
Our children and grandchildren will bear this burden. As my wife and I prepare to welcome our first child into the world, the fiscal crisis hanging over the heads of the next generation is a heavy weight. We need to take decisive action.
We know we can’t tax our way out of debt. The best way to bring down the deficit is by growing the economy through better tax policy and holding the line on spending.
This is why the House fulfilled its constitutional power of the purse by passing the Fiscal Year 2018 budget resolution during the first week of October. This budget balances within 10 years and unlocks our ability to pursue pro-growth tax reform through reconciliation.
The reconciliation process, as created by the Congressional Budget Act of 1974, requires designated congressional committees to find a certain amount of savings within their jurisdictions by a specified date if mandated by the annual budget resolution. Once the committees submit their recommended spending cuts, the Budget Committee produces one reconciliation bill for a vote. The bill cannot be filibustered in the Senate and only needs a simple majority to pass – 51 votes rather than the usual 60.
The House budget resolution instructs 11 committees to cut spending by a combined $200 billion in order to start paying down our debt. It outlines a pathway to $6.5 trillion in total deficit reduction over 10 years. It also reforms Medicaid and strengthens Medicare, two of the largest drivers of our debt. Additionally, it redirects resources toward securing our border.
With a budget in place, we can move forward on our tax reform framework introduced at the end of September to simplify the code. When Americans keep more of what they earn, they can invest more money into our economy. When businesses are incentivized by a competitive corporate tax rate and full and immediate expensing, they can create jobs and more actively drive economic growth. Pro-growth tax reform means more jobs, fairer taxes, and bigger paychecks, which will transform our country’s fiscal course.
Doubling the standard deduction, or the “zero bracket,” increases the percentage of Americans’ income exempt from taxation. Nine out of 10 Americans will be able to file their taxes on a form the size of a postcard. Americans currently spend 2.6 billion hours each year filing individual income tax returns, with an annual compliance cost of $99 billion. Streamlining this process will help reverse the enormous drain on our economy caused by an overly complicated tax code.
The budget resolution passed by the House paves the way for the first comprehensive, permanent tax reform in more than 30 years. On the Ways and Means Committee, we are moving full-steam ahead on turning the framework into legislation to create a simpler, fairer tax code for all.