Wednesday, August 31, 2016



Porker of the Month: Sen. Chuck Schumer

Watch CAGW’s August Porker of the Month Video
Citizens Against Government Waste (CAGW) has named Sen. Chuck Schumer (D-N.Y.) Porker of the Month for playing a leading role in the effort to create “debt-free college” for all students, which would in fact dramatically worsen the student loan crisis. Student loan debt hit an all-time high of $1.26 trillion earlier this year. The average new college graduate now owes more than $37,000 – more than double the amount owed in the early 1990s. Over the past three decades, tuition costs have increased 153 percent for private colleges and 231 percent for public colleges, faster than the costs of food and healthcare. The cause of this dramatic increase is simple: increased federal subsidies. Over the past decade, there has been a 69 percent increase in students’ borrowing from federal loan programs. This increase in student access to credit has enabled colleges to continue to hike prices, requiring even more borrowing. Sen. Schumer proposes to make the problem even worse with S. 2677, the In the Red Act, which would increase federal subsidies, increase student loan borrowing, and saddle future generations with even more debt. For his lack of understanding of the student loan bubble and his efforts to inflate it even further, Sen. Schumer is the August Porker of the Month. Read more about the Porker of the Month.
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CAGW Applauds Court’s Smack Down of FCC Overreach
CAGW praised the U.S. Court of Appeals for the Sixth Circuit for its August 10 ruling against the Federal Communications Commission’s (FCC) claim that it could override state laws relating to municipal broadband deployment. The case stems from a 2015 vote by the FCC to preempt laws in North Carolina and Tennessee that placed restrictions on local municipalities’ ability to build government-owned broadband networks. Twenty states have enacted such restrictions – and for good reason. CAGW has documented how municipal broadband networks across the country have been a financial drain on local taxpayers, lack long-term resources for maintenance and upgrades, and compete unfairly with existing private-sector broadband providers. Reacting to the ruling, CAGW President Tom Schatz said, “The assertion that the [FCC] could overturn state laws … was a stretch, and another example of the FCC’s – and the entire Obama Administration’s – massive overreach. This case … upholds the constitutional rights of states.” Learn more about the court’s decision.
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CAGW Reacts to USPS’s $1.6 Billion Loss
CAGW reacted with frustration and indignation after the United States Postal Service (USPS) announced a loss of $1.6 billion in the third quarter of fiscal year (FY) 2016. The loss is a $981 million, or 167.4 percent, increase from the same quarter in FY 2015. This brings the total amount lost by USPS over the past nine years to more than $50 billion. Despite having an estimated $18 billion financial advantage over its private-sector rivals, USPS has continued to turn in increasingly dismal financial numbers. Responding to the report, CAGW President Tom Schatz said, “USPS is quick to point out supposed obstacles, while ignoring its exclusive advantages. As mail volume continues to decline, agency leaders persist in peddling the misguided belief that financial salvation lies in accounting gimmicks and starting new non-postal ventures. USPS should focus solely on its letter mail products and not stray from its original mission.” Read more about the Postal Service’s mounting losses.
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From “The Swine Line” ...
On August 5, the Congressional Budget Office (CBO), the nonpartisan legislative agency that analyzes government spending, released an updated estimate of $590 billion for the FY 2016 federal budget deficit – 10 percent greater than originally projected – reports CAGW Policy and Government Affairs Associate Rachel Cole on CAGW’s “Swine Line” blog. The FY 2016 deficit will rise as a percentage of GDP for the first time since FY 2009 and is up roughly one-third over last year’s deficit of $438 billion. CBO attributed the increase to higher-than-expected spending on Social Security benefits, interest on the debt, Medicare, Medicaid, and the Department of Veterans Affairs and lower-than-expected tax revenue. Given those facts, instead of asking Americans to fork over even more of their hard-earned dollars in taxes to cover the gap, Congress should focus on reducing spending, concludes Cole. Read more on “The Swine Line.”
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