Today is Tax Day. Federal tax returns are due to the Internal Revenue Service with a postmark before midnight. The Congressional Budget Office (CBO) projects that the federal government will collect $3.2 trillion in revenue this year.
Revenue comes from five main sources:
The Small Business Administration’s (SBA) stated mission is to aid small businesses and strengthen the economy. Under its popular 7(a) program, SBA provides private lenders with loan guarantees. In the case of default, SBA steps in to cover up to 85percent of the lender’s losses.
This structure encourages lenders to provide more loans, but also encourages the approval of riskier loans. The lenders are insulated from most of the risks of default.
Two years after whistleblowers submitted tips to the Commerce Department Inspector General’s office, the United States Patent and Trademark Office (USPTO) is acknowledging extensive timekeeping fraud among its employees.
There exists in the Department of Commerce an irrelevant Great Society relic called the Economic Development Administration. With a relatively small budget of around $400 million, the EDA acts as a slush fund for Congress to shovel subsidies to their districts for projects that should be funded locally or privately.
The Hill reports that “The Commerce Department is considering naming Arab Americans a socially and economically disadvantaged minority group that is eligible for special business assistance” through its Minority Business Development Agency. I would argue that the federal government should not favor people of one particular ethnic backgrounds over others. However, I think the bigger issue here is that a Commerce determination in the affirmative would be yet another step in the direction of greater government dependency.
Tuesday evening I blogged on a pending vote in the House on an amendment introduced by Rep. Mike Pompeo (R-KS) to eliminate funding for the Economic Development Administration. Unfortunately, the amendment failed yesterday on a vote of 129-279. All 175 Democrats voting joined 104 Republicans in keeping the EDA alive.
My colleague Sallie James reported this morning on the looming vote in the House to reauthorize the Export-Import Bank. There are two other votes, which could come as soon as this evening, that would provide a similar indication of how serious the Republican-controlled House is about limiting government and supporting free markets.
Contrary to what various news outlets are reporting, President Obama is NOT proposing to cut government. The administration is proposing to take four independent federal agencies that specialize in corporate welfare – along with the Office of the U.S. Trade Representative – and combine them with corporate welfare programs at the Department of Commerce to form what I would argue should be called the Department of Corporate Welfare.
The Indianapolis Star recently profiled local boy makes good (handing out other people’s money) John Fernandez, the ex-Bloomington mayor and Obama fundraiser who now heads up the Economic Development Administration. A reference to an EDA taxpayer handout to a technology park in southern Indiana caught my eye:
Three weeks ago, a national commotion erupted when the Drudge Report headlined a story from the Heritage Foundation on the Obama administration’s implementation of a new tax on Christmas trees. I noted here that the 1996 legislation enabling the U.S. Department of Agriculture to implement the tax received most of its support from Republicans, including co-sponsor John Boehner.
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