Restricting the Government’s Purse

A friend requested I read this short Senate Joint resolution sponsored by Senator Jim DeMint, a congressman who represents South Carolina.  The bill concerns a constitutional amendment to balance the federal budget, a move possibly implemented by the recent increase in the federal debt ceiling signed by President Obama.

The resolution has eight sections for the proposed new Article, all of which center around restricting the total outlays, or expenditures, within a fiscal year to the total expected receipts for that year.  The amendment would also restrict the budget proposed by the president within the same receipts.

The proposed amendment does have room to stretch, however, in the ability of Congress to override the bill with a two-thirds majority or during times of war.

I do have a problem with section 6:

Section 6. The Congress shall enforce and implement this article by appropriate legislation, which may rely on estimates of outlays and receipts.

By whose authority shall the Congress abide by the estimates? So far this year, with the federal receipts at an unexpected all-time low, I don’t have much faith in their ability to second-guess themselves.

I’m also curious about section 7:

Section 7. Total receipts shall include all receipts of the United States Government except those derived from borrowing. Total outlays shall include all outlays of the United States Government except for those for repayment of debt principal.

Why does the proposed amendment makes exclusions for certain receipts and outlays? On what grounds are these given special treatment over other expenses and gains?

First Up to Bat

The first bill up to the plate is one introduced by Senator John Kerry from Massachusetts, S. 144. The bill, very short, regards the Internal Revenue Code of 1986 and its reference to cellphones under section 280F. Here’s the relevant portion of the bill for the link clicking-impaired.

(a) In General- Subparagraph (A) of section 280F(d)(4) of the Internal Revenue Code (defining listed property) is amended by inserting ‘and’ at the end of clause (iv), by striking clause (v), and by redesignating clause (vi) as clause (v).

Here’s the section 280F which would be altered:

(iv) any computer or peripheral equipment (as defined in section 168 (i)(2)(B)),
(v) any cellular telephone (or other similar telecommunications equipment), and
(vi) any other property of a type specified by the Secretary by regulations.

The bill would essentially add an ‘and’ to portion (iv), eliminate (v), and move up (vi) to (v).

Now what does this do to the average business owner and employee? Pretty much it gives them a tax break on cellphone usage for those phones owned by the company and given to its employees to stay in touch. Currently they’re listed as luxury items by the outdated 1986 code, which then designates them as personal items and subject to the taxation. For an added bonus, laptops are also still listed as luxury items because they can be taken from the place of business.

The amendment by the bill would exclude them from luxury and place them as relevant to an employee’s job performance.  The effective date for S. 144 is  December 31, 2008, so currently the bill would be retroactive. A question I have is would the enactment mean a refund to those who may have had to pay taxes on their phones?

So far, however, the bill has only been referred to the Finance Committee, and that was on January 6, 2009, but let’s hope it’s one of the lucky ones to reach the desk in the Oval Office.

Beginning of a Beautiful Friendship

Presenting an ambitious work of reading and interpretation as I attempt to read (and comprehend!) the bills presented to both houses of the United States Congress, with the help of my lovely assistant, GovTrack.us