Lawmakers Should Offset Competitiveness Bill
This week, the Senate is voting on motions to instruct the conferees for H.R.4521, known as the United States Innovation and Competition Act or the America COMPETES Act. As written, the bill could add up to $65 billion to deficits over the next decade or more if other unpaid-for policies are added to it. The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
With high debt and surging inflation, now is a good time to focus on improving our nation’s competitiveness and productive capacity. But deficit financing these new investments adds to debt and risks making our inflation situation worse. We shouldn’t be borrowing from China to compete with China.
As this legislation moves to conference, lawmakers should identify offsets to ensure at the very least it would be fully paid for. And they should avoid adding new debt-financed tax cuts or spending to the bill.
Repealing amortizing of research and experimentation, for example, would cost an additional $150 billion, potentially more than tripling the deficit increase of the bill. Temporarily delaying amortization will hide these costs, but it won’t reduce them.
To truly strengthen our competitiveness, we need to wring out inflation and address our nation’s high and rising debt. Borrowing more would be a step in the wrong direction.
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