With the end of the fiscal year, the Congressional Budget Office concluded that the federal deficit is actually $27 billion lower than was forecast in August, totaling $374 billion for 2003. Unfortunately, the shrinking deficit is not an indication of renewed fiscal restraint by the federal government. In fact, this year’s deficit is more than double the 2002 deficit of $158 billion. The main reasons for the drop in this year’s deficit are corporate revenues that are increasing as the economy strengthens and smaller than forecast outlays on defense and education. Discretionary spending, however, continues to be problematic, and mandatory spending on entitlement programs will skyrocket under a huge Medicare drug benefit currently being negotiated.

This week AmeriCorps supporters are rallying in Washington to get taxpayer’s money for the Clinton-created “volunteer” program that pays college students for community service. They are planning 100 hours of non-stop testimony detailing how AmeriCorps “volunteers” are rebuilding communities, assisting the elderly, mentoring children, and rekindling a sense of patriotism—and how none of this good work will happen if they don’t get $100 million more from Congress.

©2003 Copley News Service, 8/19/2003 There is a long and tragic tradition that runs through American politics in which politicians spend themselves into a fiscal crisis during good economic times and then raise taxes to bail themselves out when a recession hits and revenues plummet. This is precisely what's going on today in Alabama and California.

©2003 Copley News Service, 8/12/2003

Lawmakers in Maine realized the need for tax reform to fund education and give Mainers property tax relief. On November 4, 2003 a referendum will be held for the citizens of Maine to vote on tax reform proposals. The only plan that has made the November 4th ballot thus far was proposed by the Maine Municipal Association (MMA). MMA’s plan calls for the state to provide over $200 million for local education and to give taxpayers property tax relief of the same amount. Still, Maine state officials need to be careful of how to raise the $200 million necessary for the tax cut. The additional revenues needed should come from spending cuts to ensure that one tax relief is not traded with some other tax increase. According to the Tax Foundation, Maine ranks #1 in the country with the highest combined state and local tax burden as a percentage of income. This statistic shows the heavy load all Mainers must carry with them and further emphasizes the need for legitimate reform. Another plan is expected to be proposed by the state Legislature in the special session that begins August 21st. The Legislature’s plan will almost certainly contain broadening the sales tax as well as increasing the upper tax bracket from 8% to 10% to cancel out any property tax relief. It is clear that Mainers need relief, and that this plan negates any break for the taxpayers. The Maine Legislature must find ways to reduce its costs and its spending significantly. CSE wants to take action to ensure the citizens of Maine get real tax reform– but we need you! Click on the link below to sign-up and join CSE’s volunteer army now! Forward this email to as many of your fellow taxpayers as you can so that they can join our fight as well. Be sure to sign-up with CSE so that we can keep you up to date on this and other important issues.

When they’re not raising taxes, too often big-spending politicians are trying to sock future taxpayers with the tab for big increases in government borrowing. Last week, quick work by Oregon CSE helped derail a new borrowing plan that would have destabilized state finances.