The House recently passed a $26 billion state aid bill into law that will help states avoid laying off teacher, firefighters, and other public employees. The cost of the bill was entirely offset by closing tax loopholes for multinational corporations, and by the early termination of extra food stamp programs funded by the stimulus.
Nonetheless, Republican Congressman Mike Pence attacked the bill for supposedly not being “paid for,” claiming that using stimulus funds to pay for it was merely “borrowing from one credit card of the federal government to [give to] another”:
PENCE: “Probably one of the most offensive things about this $26 billion bailout is that essentially we’re putting off the hard choices that state governments need to be making right now by essentially borrowing from one credit card of the federal government to another. You know, I think one of the big misstatements about this bill today is that it is so called paid for, that is fiscally irresponsible [sic]. Essentially they have taken what we had on the credit card for the stimulus and moved it over here to another credit card. And the American people aren’t fooled by this.”
However, Pence is wrong that the state aid bill isn’t paid for. According the non-partisan Congressional Budget Office, the bill actually decreases the deficit by $1.37 billion dollars over ten years.
(Source: ThinkProgress.org and CNBC)