As part of his new budget, President Donald Trump is threatening to cut the Public Service Loan Forgiveness program. Started in 2007, the program enables those pursuing careers as public defenders, social workers, teachers and doctors to become eligible for student loan debt relief. The stipulations are clear: You must work for the government or a nonprofit and pay off loans on time for 120 months. After 10 years of paying, your remaining debt will be forgiven. Education Department officials have said that these budget cuts would not affect those currently in the program, but those who hoped to take advantage of the program are left in the lurch, wondering whether they will need to change their plans.
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On Tuesday, OMB Director Mick Mulvaney unveiled President Trump’s latest budget proposal. While it includes cuts across a variety of discretionary programs, it also reforms one of the largest healthcare entitlements: Medicaid.
The budget, officially titled “A New Foundation for American Greatness,” would offer states the choice to cap Medicaid funding through a per-capita spending allotment or a block grant for the entire program. In addition, states will receive “more flexibility to control costs and design individual, State-based solutions to provide better care to Medicaid beneficiaries.”
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Now that President Donald Trump is in office, the temptation to pass legislation to either raise or remove the spending caps established by the Budget Control Act of 2011 (BCA) is enormous, and Senator John McCain recently released a proposal that would do just that.
McCain’s proposal comes in response to claims that the American military has been neutered by the Obama administration’s inattention to proper funding. These claims have been a central part of the narrative employed not only by Trump during his campaign but also by rank-and-file legislators eager to demonstrate their commitment to a renewal of American strength and vitality.
The premise that underlies this crusade is deeply flawed. American military spending is already sizeable, and though the military’s footprint has declined, it remains strong. Repealing the BCA would unnecessarily boost military spending while leaving less funding available for other increasingly costly areas of the budget like healthcare, education, and infrastructure spending.
In 2011, a deeply divided Congress, in an effort to produce a legislative mechanism so grim that both parties would have no choice but to engage in bipartisan deficit reduction, passed the BCA. The bill was designed to trim a projected $984 billion from the budget over the next decade.
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Advocate Phumlani Majozi was interviewed on eNews Channel Africa, where he responded to the 2015 South African Budget from a free market standpoint.
Watch the interview on YouTube here.
With the House Ways and Means Committee voting on repeal of the death tax next week, there is renewed hope that this inappropriate tax will soon kick the bucket. Although descendants of the deceased are most directly hurt by the death tax, everyone else gets hurt economically as well.
Repeal of the death tax would create a small, but significant, economic boost, according to Alan Cole of the Tax Foundation. “Repealing the estate tax in the United States would increase investment, add jobs, and expand the economy,” Cole says. Over the course of a decade, repealing the death tax would create 139,000 jobs. It would also boost the economy by 0.8 percent, or by over $100 billion dollars. Wages would rise by 0.7 percent.
The boost comes from lifting the tax burden on accumulated wealth, which Cole says improves the economy. When accumulated wealth is taxed, the government redistributes it in inefficient ways, and those hit by the tax try to shift their assets into less productive endeavors. As a result, money flows into life insurance policies and government coffers instead of into job-creating capital.
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