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Press Release

    CSE's advice to the 107th Congress

    01/31/2001

    As you depart to your respective retreats, CSE would like you to keep in mind the priority issues for its 280,000 members nationwide. The 107th Congress should provide a number of opportunities to address several key issues and we hope that this information will help you make the case for a pro-active free market, pro-consumer agenda.

    Provide Meaningful Tax Relief to All Americans
    The Issue: We are currently experiencing the highest rate of taxation since WWII. This is unacceptable in a peacetime environment with record budget surpluses. Each taxpayer overpaying his or her share created these surpluses. It is the taxpayers money and they deserve a refund. Providing isolated, specific tax cuts only serves to benefit the few. Only by providing across-the-board tax cuts will every American receive a benefit.

    Facts:

    A new Gallup poll shows that 74 percent of Americans favor “a cut in federal income taxes.”
    Americans are currently paying over one-third of their income in total taxes.
    Even Alan Greenspan supports tax cuts contending that they “may, in fact, do noticeable good” for the economy.
    How to Provide Real Tax Relief?

    CSE supports the passage of the full comprehensive tax package as proposed by the Bush Administration.
    Any tax package MUST include an across-the-board rate cut!
    Other tax relief that should be included: death tax elimination and marriage penalty relief.
    Modernize and Save the Social Security System
    The Issue: The current Social Security system will begin paying out more than it receives in 2015 and unless reforms are enacted, the system will be broke by 2031. Not reforming Social Security will saddle future generations with over $22 trillion in liabilities. The current situation is untenable and unfair, especially for low-income minority groups. Beneficiaries should be allowed to use some of their Social Security funds to invest in personal retirement accounts to earn a higher return and pass their wealth onto their loved ones.

    Facts:

    In 1950, there were 16 workers for each Social Security recipient. Now there are barely three workers per recipient and that ratio will fall to two per beneficiary by 2030.
    Personal Retirement Accounts (PRA’s) are the key to giving workers a better return on the money they put into the system, a chance to accumulate real wealth, and gain personal control over their retirement security.
    A 33-year-old worker paying into the program today can expect about a 1.2 percent return compared with an average 7 percent return for other safe investments.
    CSE’s Five Principles for Sound Social Security Reform

    Make sure that current retirees know they will receive every dollar promised.
    Allow working Americans to divert a portion of the 12.4 % payroll taxes into PRA’s that they control.
    Provide Americans that choose the PRA’s with a broad range of viable options.
    Guarantee Americans that they would receive at least as much in benefits with their PRA’s as they are now promised by Social Security.
    Grant recipients full control of their retirement nest egg and the right to pass on any unused funds to their family or favorite charity.
    Give Back Our Legal System to Decent, Honest Americans with Real Grievances
    The Issue: CSE believes that our system of civil justice is the crown jewel of our democracy. Unfortunately, greedy trial lawyers are exploiting the system. Our legal system now bases liability on ability to pay, rather than actual fault. Government is also exploiting our legal system by using the civil courts as a means to regulate. As Robert Reich wrote, "the era of big government may be over, but the era of regulation through litigation has just begun."

    Facts:

    In 1992 the average compensatory award was just over $400,000; in 1996 the average nearly doubled to $800,000.
    According to Lawyer Weekly, in 1997 the median of the top ten verdicts was $50,000,000; in 2000, that number skyrocketed to over $250,000,000.
    According to the Committee on Economic Development, the United States has higher tort costs, as a percentage of GDP, than any other industrialized country in the world.
    Reform Recommendations:

    Pass legislation that ensures that the government has the same rights, not greater rights, as the people for whom it sues, such as the Wicker/McConnell Litigation Fairness Act.
    Insure that state-based class actions can be heard in federal court, even if one of the plaintiffs and one of the defendants are from different states. (In the 106th Congress the House passed such legislation, HR 1875)
    Modernize Medicare Without
    Bankrupting It
    The Issue: CSE believes that health care services are best allocated by the decisions of individuals in the private marketplace. Health care services are critically important, and a market-based system offers the best chance to expand choices and control costs: government control of health care is inequitable, inefficient and irrational. Medicare is already going bankrupt, and the retirement of the baby boomers generation will cause Medicare rolls to nearly double, further straining an ailing system. Adding prescription drugs without fundamental reform of the system will bankrupt Medicare sooner while providing worse coverage.

    Facts:

    Medicare spent over $210 billion last year, and is projected to cost nearly $500 billion in ten years.
    This spending accounted for more than 12 percent of all federal expenditures last year.
    There are now four workers per retiree; in 2020, there will be less than three.
    Studies show that a new prescription drug benefit for Medicare would increase the program's costs by 7 percent to 13 percent over the next 10 years.
    Real Medicare Reform Requires These Principles:

    Give seniors more choices.
    Lower costs; don’t increase taxes.
    Achieve cost savings through consumer incentives and competition, not through government rationing, price controls, or new mandates.
    Give Every Child a Chance Through Educational Choice
    The Issue: CSE believes that choice and competition improve products and services. Giving parents the choice among the widest possible array of schools will provide these schools with the incentive to provide the best education for every student - without school choice, schools get students and funding regardless of how well they perform.

    Facts:

    40 percent of America's 4th graders continue to read below the basic level on national reading assessments.
    A 1999 study by The Joint Center for Political and Economic Studies found that 60 percent of African-Americans support school choice.
    An annual poll by Phi Delta Kappa, a professional association of educators, recently revealed that support for vouchers rose from 45 percent in 1994 to 51 percent in 2000.
    Recommendations on How to Promote Real Education Reform:

    Pursue policies that will increase competition, innovation and diversity in the education system.
    This includes vouchers, choice programs, charter schools and tax credits.
    Support the Bush Administration’s education proposal that establishes a $1,500 voucher program for students in failing schools.