Lee Zeldin is Congratulating Himself

David Posnett — Sat, 02 May 2020 02:06:12 +0000

Lee Zeldin is congratulating himself and claiming he steered 257 million in Federal funding to Suffolk county, money allocated through the CARES act for Coronavirus assistance.

I looked at the numbers to check whether this was a fair allocation of funds and how the CARES funds were allocated in the first place.

	CARES $$	Population	Total COVID cases*	COVID cases/100K*
USA	150,000,000,000 (100%)	328,200,000 (100%)	1,030,487 (100%)	314
Suffolk	257,670,000 (1.72%)	1,477,000 (0.45%)	32,724 (3.2%)	2209
Nassau	236,790,000 (1.57%)	1,357,000 (0.41%)	35,085 (3.4%)	2584

* based on reports from end of April

First, although Suffolk and Nassau counties are flashpoints of the current COVID-19 outbreak with few other counties anywhere in the USA rivaling the numbers of cases per 100K population, neither county is getting the dollar amount reflecting that. Going by total COVID cases, they should be getting about 3.2-3.4% of the CARES dollars, but they are actually only getting about half of that.

So why is Lee Zeldin bragging about this? Is he perhaps suggesting that as the president’s friend and big supporter, he has procured a special deal for us? The numbers tell a different story: Long Island is getting squeezed.

Second, part of the problem is the method by which allocation was calculated:

“Allocation is by population, … each state is guaranteed at least $1.25 billion even if its population share would otherwise indicate a lesser amount.” https://taxfoundation.org/federal-coronavirus-aid-to-states-under-cares-act/

This obviously skews the money allocation to the less populous states which are mainly red states.

“Local governments with populations of 500,000 or more (like Suffolk and Nassau) are also eligible for aid, a provision responsible for much of the confusion. Localities are permitted to claim 45 percent of the amount allocated for their population, while the state retains the other 55 percent as it also serves that population. The state also retains 100 percent of the amount allocated to populations not within a locality of 500,000 or more.” https://taxfoundation.org/federal-coronavirus-aid-to-states-under-cares-act/

The executive branch and the US Treasury Dep., in particular, are running this show. And allocations are determined by their formula. It is unclear to me how Lee Zeldin can claim any bragging rights for the money allocated to Suffolk county.

Should we not insist on having a congressional representative who actually fights for his constituents? Instead, we have a Trump imitator who all too often uses tragedy to promote himself and his political campaign.

What goes much further in my book is when credit is received from others and in particular from Democratic leaders. Here is an example from the East Hampton Star:

Mr. Steve Bellone, the Suffolk County Executive (a democrat) explained that The Municipal Liquidity Facility gives counties the ability to do short-term borrowing to address cash flow issues caused by revenue almost completely drying up because of the wholesale shutdown of certain parts of our economy. Previously, a county must have had at least two million residents, which Suffolk county does not, to qualify for the Municipal Liquidity Facility. So Bellone wrote a letter to Steve Mnuchin.

Mr. Bellone credited Senator Charles Schumer and Rep. Lee Zeldin with persuasive advocacy for Suffolk. Mr. Schumer “literally walked the letter into Steven Mnuchin’s office,” he said of his letter to the Treasury Secretary and spoke with Jerome Powell, the chairman of the Federal Reserve. Mr. Zeldin lobbied President Trump and Mr. Mnuchin, Mr. Bellone said, “and the congressman put me on the phone, set up a call with the Treasury secretary and himself so I could make the case directly about why Suffolk County needs this and why this is so important.”

CRFB President: Trump’s Tax Plan Will Add $5.5 Trillion to the Debt

David Posnett — Sat, 29 Apr 2017 14:33:35 +0000

This column first appeared in Time

Maya MacGuineas

Apr 27, 2017

Maya MacGuineas is president of the nonpartisan Committee for a Responsible Federal Budget.

President Trump is on the right track by turning focus toward fixing our nation’s broken tax code. But so far, he is going about it all wrong.

We desperately need tax reform. True reform requires making the tough choices about what works and what doesn’t, not simply offering tax giveaways for all. Tax rate cuts are important and a driver of growth, but do not be hoodwinked: no way will they pay for themselves.

The President understands the challenges we face. Growth is sluggish; our 35% corporate tax rate is the highest in the developed world; our strategy for international taxation is a mess; and the income tax seems to get more complicated and opaque every year.

But these problems cannot be solved by simply lowering all businesses taxes to 15% while cutting taxes for individuals. In fact, the President’s current proposal is likely to worsen our country’s growth prospects by ballooning our record high national debt.

The President’s plan could add over $5 trillion to the national debt over the next decade. As a result, debt would rise to a higher share of the economy than any time in history.

Treasury Secretary Steve Mnuchin, in a Wednesday morning speech, said the proposed overhaul would amount to “the biggest tax cut” and the “largest tax reform” in U.S. history.

When it comes to tax cuts, there is always the free lunch crowd claiming if we cut taxes, they will pay for themselves through growth. Here in the real world, smart, pro-growth tax cuts can at best cover a fraction of their costs. In fact, large tax cuts can actually harm economic growth by creating a massive debt load.

So if the initial Trump offer is unaffordable, what should we do?

Step one is thoughtful and responsible business tax reform. The average corporate tax rate among wealthy countries is about 10 points below ours, putting them at a competitive advantage. America is the greatest economy in the world, and if we can get our corporate rate to 25 or even 28 percent, we’ll be the most competitive as well. We should finance those rate cuts by ending tax breaks that favor some businesses over others and distort business decision-making. We can also raise revenue by shifting taxation from mobile business entities to the shareholders who actually profit from corporate gains. We can cut the rate further with more aggressive payfors.

Step two is to clean up and simplify the individual tax code. Most of the nation’s $1.6 trillion of annual tax breaks go to individuals – largely to wealthier Americans and mostly in ways that add complexity and hurt economic efficiency. The more tax breaks we can repeal or reform, the better. Most of the revenue can go to cutting individual rates; some should go for deficit reduction. One idea worth trillions is a cap I developed with Marty Feldstein and Dan Feenberg to limit the total value of major tax preferences as a share of income. The Administration could keep all the tax breaks it wants to protect (like the mortgage deduction) but include it in this limit.

Step three is to reform our entitlement programs. Social Security, health, and interest spending are responsible for 82 percent of projected spending growth over the next decade; and both Social Security and Medicare are headed toward insolvency. Thoughtful reforms can improve health outcomes, encourage work, strengthen retirement security, and reduce the long-term debt all while protecting the most vulnerable.

The final step is to do everything else we can to encourage economic growth. While promises of 4 percent annual growth are pure fantasy, we need to get our growth rates well above 2 percent. That faster economic growth needs to be broadly shared so it lifts all incomes, improves everyone’s wealth, and helps our fiscal situation. To achieve faster growth, policymakers need to fire on all cylinders — pursuing reforms to taxes and entitlements but also regulations, immigration, federal investment, trade, and energy. A critical component of the growth agenda is to get our debt under control.

As a nation, we cannot pretend we can grow our way out of any hard choices.

But the President is right to focus on economic growth. If we don’t get our economy growing again, the American dream may be history.

Mnuchin – R&R – Reachout and Rebuild

Lee Zeldin is Congratulating Himself

CRFB President: Trump’s Tax Plan Will Add $5.5 Trillion to the Debt

This column first appeared in Time