Senator Jon S. Corzine Statement on
the Republican Budget Resolution
WASHINGTON - 04.03.01 | As many of my colleagues have commented, the President's tax cut proposal has serious problems it is too expensive, it precludes fundamental investments, and it challenges America's sense of fairness.
It's missized. It's misdirected. It's mistimed.
Frankly, it is terrible economics and overreaching because no one can predict the future. And that's mismanagement.
First, the proposal does virtually nothing to stimulate our economy in the near term. It turns its back on the accumulating and troubling signs of economic weakness that we are seeing in the economy particularly in our manufacturing, technology and export sectors.
As you know, most of the Bush tax cuts are delayed until many years down the road 95% of the cuts go into effect after 2003.
More importantly, the excessive size of the Bush tax cut is premised on economic projections that can be little more than guesses or "coin flip outcomes." Even small changes in the underlying assumptions would dramatically change the outcome over 10 years. Most dangerous is the buy-in of the sharply higher productivity numbers.
This isn't just our view. Credible outsiders like the Concord Coalition make the same point. The CBO itself emphasizes that its projections are uncertain. CBO says that, even if Congress takes no action, the budget could either be in deficit, or could be a trillion dollar surplus within 5 years.
Given all this uncertainty, it challenges our common sense to act with certainty in assuming that these projected surpluses will be there. In the world I came from, any C.F.O. worth his salt would not work off budget projections beyond 3 years and even shorter ones only skeptically. Prudent judgment argues long-term guesstimates are bets often bad bets. The Bush tax cut is just that.
If baseline projections become reality, Congress can always cut more taxes later. But if we overreach today, it will be painful to correct our mistakes later. More likely, we will return to the bad old days of deficit spending and weak economic growth.
So yes, we can and should cut taxes moderately and responsibly. We should do it now, when our economy needs a stimulus. But, for the sake of our nation's economic future, we should do it responsibly.
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