Committee on the Budget

Tom Price

Budget Chairmen: Dept. of Ed’s Rule Could Cost Taxpayers Billions

2016/07/15

WASHINGTON D.C. – Senate Budget Committee Chairman Mike Enzi (R-WY) and House Budget Committee Chairman Tom Price (R-GA) have asked the Department of Education for additional information concerning a new proposal by the department that could add as much as $41 billion to the cost of the federal student loan program over the next decade, according to an administration estimate. 

Read the full letter to the Department of Education here.

Excerpts follow:

“This is the latest in a series of administrative actions taken by the Education Department under this administration that have substantially increased the cost of the Federal direct student loan program. There are at present no budget control mechanisms to limit the cost of administrative changes to the student loan programs made pursuant to current law, however great the cost or the departure from long-standing policy.

“This administration has used its discretion to spend billions of unbudgeted dollars, most recently via a loan repayment/forgiveness rule published last October that the Department estimated would cost taxpayers $15.3 billion over 10 years.”

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#RestoringTheTrust for America’s Seniors

2016/07/15

WASHINGTON, D.C. – Medicare and Social Security are going broke. That’s according to the Medicare and Social Security Trustees, as well as the Congressional Budget Office, who have repeatedly warned that these programs are fiscally unsustainable. But there is more to this story.

As House Budget Committee Chairman Tom Price, M.D. (GA-06) put it during the Committee’s hearing this week on Restoring the Trust for Americans At or Near Retirement, “unfortunately, the financial well-being of the programs is just one of the challenges that we face. If Medicare and Social Security were on solid financial footing – which they clearly are not – the programs would still be suffering from an antiquated and flawed design. In short, recipients are not getting the highest level of benefit and services they could under a reformed system.”

So what’s to be done?

The House Budget Committee has embarked on an initiative called Restoring the Trust for All Generations to raise awareness about the fiscal and policy challenges inherent in Medicare, Social Security, and other automatic Federal spending programs. The aim is to achieve a critical mass of support in Congress and across the country to save, strengthen, and secure these programs. This week’s hearing – the third in a series of hearings begun last summer on this issue – focused on both the financial failings of the current structure of our health and retirement programs as well as the need to adopt a system that better serves America’s seniors.

For Medicare, that means a system that puts personal health care decisions back in the hands of individuals, not the Washington bureaucracy, so they are the ones deciding when and how to get the most appropriate level of care. As Dr. Scott Gottlieb, M.D. – Resident Fellow at the American Enterprise Institute – noted in his testimony:

“There’s going to be rationing in the system. That’s the reality. The questions is: who’s going to do the rationing? Is it going to be done by Medicare and more of a central authority, or are we going to allow actors in the marketplace to make those decisions, consumers or providers? We’re making a decision to shift the node of decision-making, if you will, on rationing to both providers in Medicare and away from consumers. That seems to be a deliberative decision that we’ve made in the last five or seven years. I would argue I think that the more we can shift these kinds of considerations onto consumers the more we are going to have people be able to exercise discretion in one of the most personal decisions that they are going to make which is how they get medical care.”


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As for the fiscal health of Social Security, the challenge is a bit more straightforward as is the consequence of inaction. Or as Dr. Jason Fichtner, Ph.D. – Senior Research Fellow at the Mercatus Center at George Mason University – put it:

“Fiscal health for Social Security means that we have enough revenue coming in to pay benefits. And under current law – so if nothing is done by Congress or the president – if we don’t do anything, by law, benefits will be cut around 2035 by about 25 percent…It happens automatically unless Congress does something to stop it.”


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“Unless Congress does something to stop it.” That’s the goal of the Restoring the Trust initiative – to take action to stop Medicare and Social Security from careening toward insolvency and instead to do something to save, strengthen, and secure them for today’s beneficiaries and future generations. Otherwise, these crucial programs will not have enough resources to provide full benefits for millions of Americans. Or as Daniel Weber – Founder of the Association of Mature American Citizens – describes it:

“Right now Social Security is like an airplane that is taking off for a flight, and it doesn’t have enough gas to get to the destination.”


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Chairman Price Opening Statement: Restoring the Trust for Americans At or Near Retirement

2016/07/13

As prepared for delivery

Today’s hearing is the third in a series of hearings begun last summer when this committee embarked on a new initiative called Restoring the Trust for All Generations. This is an effort to raise awareness about the fiscal and policy challenges inherent in America’s health, retirement, and economic security programs. By focusing attention on these matters, we aim to build a broad consensus among our colleagues and the country at large around the need to do something to save and strengthen programs like Medicare and Social Security so today’s beneficiaries and tomorrow’s retirees have programs they can count on.

Both Medicare and Social Security face real, substantial financial challenges. According to the most recent report from the Medicare and Social Security Trustees, Medicare's hospital insurance trust fund is expected to be insolvent in 2028 – two years earlier than previously estimated. Social Security will exhaust its reserves in 2034. This is not simply an accounting challenge. With insolvency, Medicare will be able to cover only 87 percent of expected health care costs for beneficiaries, and Social Security recipients will face an immediate 21 percent reduction in benefits. Clearly, doing nothing is not an option.

With 10,000 baby boomers reaching retirement age each day, the number of workers paying into Medicare and Social Security is inadequate to ensure the long-term solvency of these programs, as they exist now. In 1950, the Social Security program was supported by 16.5 workers for every retiree; that number is now 2.8 workers per retiree. We can lament this fact, but we cannot deny it. The demographic and fiscal dynamics at play in both of these programs are a ticking time bomb counting down to when the promise made to seniors will no longer be kept. Surely no one believes that is an acceptable scenario.

Unfortunately, the financial well-being of the programs is just one challenge we face. If Medicare and Social Security were on solid financial footing – which they clearly are not – the programs would still be suffering from an antiquated and flawed design. In short, recipients are not getting the highest level of benefit and services they could get under a reformed system.

Medicare’s current structure is awkward and cumbersome. You have to sign up for three separate programs in order obtain essentially the same level of coverage you would get in the private insurance market. Even then, a number of Medicare enrollees feel obligated to purchase additional insurance to cover gaps in what Medicare is able to offer.

Meanwhile Social Security has not kept pace with an evolving economy and society. The program encourages early retirement even though people are now both working and living much longer than when the program first started.

As with so many of the challenges facing our nation today, the ultimate success of any reform effort lies, partially, with the health of our economy. But stronger economic growth is no panacea. It will not improve the structure of these programs or ultimately ensure their sustainability. It certainly will not make the programs more reflective of the needs of our senior citizens.

With our Restoring the Trust initiative we do not seek to dictate specific solutions. Rather, we aim to raise awareness and promote important principles that ought to be a part of any effort to save, strengthen, and secure vital programs like Medicare and Social Security. By focusing on the need for better choices, greater competition among those providing services to beneficiaries, and innovation across the board, we can ensure health and retirement security for the American people.

To help us discuss how best to achieve that goal, we are joined this morning by Jason Fichtner, Senior Research Fellow at the Mercatus Center at George Mason University; Daniel Weber, Founder of the Association of Mature American Citizens; Scott Gottlieb, Resident Fellow at the American Enterprise Institute; and Monique Morrissey, an economist at the Economic Policy Institute.

Thank you all for being here. I look forward to a constructive discussion. This issue could not be more important to individual Americans and our country as a whole.

And with that, I yield to the Ranking Member, Mr. Yarmuth Read More

Price Statement on Latest CBO Long-Term Outlook

2016/07/12

WASHINGTON, D.C. – House Budget Committee Chairman Tom Price, M.D. (GA-06) issued the following statement today after the Congressional Budget Office (CBO) released its latest Long-Term Budget Outlook showing the national debt climbing to 141 percent of GDP by 2046, with real economic growth remaining at a depressed 2.1 percent on average over the next 30 years, and Medicare and Social Security facing insolvency.

“One wonders how anyone can look at this report and not feel compelled to take action. We have no choice. The Congressional Budget Office is sending yet another wake-up call, and policymakers better listen. These debt projections portend a horrible fiscal legacy that is being left to our kids and grandkids with a correspondingly weak economic growth outlook that will mean less opportunity for our nation and its citizens in the years to come.

“The good news is that we can enact policies that ensure a more responsible fiscal outlook. A balanced budget would help deliver greater economic growth. We can protect current seniors and tomorrow's retirees from insolvent Medicare and Social Security programs. We can do all this while embracing policies that support a healthier and more vibrant economy.”

The House Budget Committee will hold a hearing tomorrow, as part of its Restoring the Trust for All Generations initiative which was begun last year to raise awareness about the fiscal and policy challenges inherent in the nation’s health, retirement, and economic security programs. Wednesday’s hearing will focus on Americans at or near retirement and the need to save, strengthen and secure Medicare and Social Security for the future.

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Chairman Price Opening Statement: An Introduction to Regulatory Budgeting

2016/07/07

As prepared for delivery

Yesterday’s hearing focused on a series of different potential alternative budgeting methodologies. Today, we are focusing on a specific area of interest – regulatory budgeting.

This is an area apart from the different styles of budgeting that would directly affect how this committee would allocate discretionary and mandatory spending. However, there is a direct connection between the financial impact of regulations on our economy – on American innovators, individuals, and families – and our nation’s fiscal well-being. So it is appropriate and fitting that we – in the context of an overhaul of the Congressional budget process – highlight regulatory budgeting.

At nearly $2 trillion, the annual regulatory burden in this country is 6-7 times larger than the annual corporate federal income tax burden. It is roughly equivalent to half of what the federal government spent last year in its entirety! If the annual cost of the regulatory state in America was represented by an independent country’s economy, it would qualify as one of the world’s top 10 economies, ranking between India and Russia – this is money removed from the productive economy.

How has this happened? For too long, Congress, as an institution, has ceded greater and greater authority to a regulatory state that has grown in power to become, in many ways, an unchartered 4th branch of government. Not surprisingly, the Executive Branch has welcomed the opportunity to impose its will on the American people through a cadre of unelected and unaccountable bureaucrats. Without conceding that this arrangement is acceptable – and it is not – we should still be willing to consider the establishment of a budget that accounts for the impact of the regulatory state.

A regulatory budget would serve several purposes – not the least of which is a transparent accounting of the true impact of actions taken by the Executive Branch of government. As we have discussed numerous times in this committee, a budget is not simply a set of numbers. It identifies and signifies priorities. Similarly, a regulatory budget would not simply be an accounting of the financial consequences of a given regulation. It would be a window into the impact of that regulation on the broader economy – on the lives and livelihoods of the American people. It would present the American people and Congress – which is charged with oversight of all governmental activity – facts supremely important to the conduct of that oversight.

The volume of regulations has increased significantly.  They are markedly overshadowing the number of laws being passed.  Just last year there were 115 laws passed by Congress and enacted – total.  At the same time, there were 3,410 new Rules issued by Federal agencies. 

So, who is most harmed by the ever expanding regulatory state and the costs associated with it? It is not predominantly the big banks and corporations that are often the target of choice of regulators and those backing their regulations. In fact, it is small businesses who do not have the army of lawyers that large businesses have to help comply and/or weather the fallout. It is lower-income individuals and households who see the price of goods and services like housing, electricity, and transportation go up because of the heavy regulation in those industries. That is who is getting squeezed – low-income Americans and small businesses.  Remember – nearly $2 trillion are spent each year by those trying to be certain they are complying with all of these regulations.  Those costs – of necessity – are passed on to everyone; and the folks harmed most by these compliance costs are those least able to pay.

Despite all of this, Congress has no systematic means of tracking, and if possible restraining, this expansion of the regulatory state.

The Budget Resolution passed out of this committee earlier this year specifically discussed the need for regulatory budgeting. It was the first time a budget resolution expressly called for such a budget. We are not alone in this effort. The Speaker of the House’s Task Force on Reducing Regulatory Burdens also specifically recommends establishing a regulatory budget to help address the growing concern of the regulatory state.

I’m grateful for the participation of our panel here today. We have Dr. Patrick McLaughlin, Senior Research Fellow at the Mercatus Center at George Mason University; Richard Pierce, Jr., the Lyle T. Alverson Professor of Law at George Washington University; and Clyde Wayne Crews, Vice President for Policy at the Competitive Enterprise Institute.

Thank you all for being here and for you attention to this incredibly important issue.

And with that, I yield to the acting Ranking Member, Mr. Yarmuth. 

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Price Opening Statement: Alternate Approaches to Federal Budgeting

2016/07/06

As Prepared for Delivery

This committee has spent its past several hearings examining the failures of the current Congressional budget process and the need to overhaul the system and rewrite the rules under which we budget. We have focused attention on the core challenges we face and the fundamental goals we ought to have in attempting to improve the way Congress approaches its fiscal responsibilities. Today, we will begin to shift our attention to what sort of specific approach or approaches could best serve our goal of fiscal responsibility and a more effective, efficient, and accountable government.

Examining the varied virtues of different budgeting styles takes the discussion beyond the conventional understanding of a budget as more or less just a series of numbers. As we have throughout this process, we welcome and encourage the members of this committee and our expert panel of witnesses to seize this opportunity to uproot the conventional and reframe the budget conversation as one of policymaking, not just number crunching.

Among the alternative approaches this committee ought to consider, there is performance-based budgeting to take into account how well different federal programs are achieving their intended outcomes. Through its oversight responsibility, Congress already ought to be measuring the success of a program by its outcomes. From a budgetary standpoint, we ought to encourage that and reward it.

There is capital budgeting to account for long-term capital investments beyond the day to day operations of the federal government. Not all spending is the same. Not all spending operates on the same timeline. Perhaps we ought to have a system that can recognize that fact.

Portfolio budgeting is an approach that would account for the full range of fiscal policies that promote broader national priorities. This would apply a more holistic perspective that could help focus the attention of policymakers on the success or failure of broad goals and strategies to achieve those goals over time.

Lastly, I would be remiss if I failed to mention zero-based budgeting which is aimed at determining the correct starting point from which we build a budget.

Each of these different approaches to budgeting – and surely there are others – accentuates a different pathway to achieving a similar goal – namely a more competent government that is able to serve the nation’s priorities in a more sustainable fashion. By approaching the budget in a framework outside or beyond purely financial terms – dollars in and dollars out – we allow the budget process to embrace the broader spectrum of policymaking.

Every program and initiative that Congress considers does tend to have a dollar amount attached to it. Common sense, however, tells us that the price tag of a program is not necessarily reflective of its true value. A cost evaluation can underestimate or overestimate the impact or benefit of any given program, and being able to afford something is not justification enough for doing it.

We know from the debates we have each year in this committee that budgets are not simply spreadsheets. They reflect our governing philosophy and our priorities. We ought to have a process that understands this broader nature of our budgets and focuses our energy on goals beyond merely the fiscal health of the country.

By bringing forward a diverse array of budget styles we inevitably invite the challenge of complexity into our budget process. We have no interest in replacing a system that is frustratingly complex to the point of being ineffective or ignored with one that is equally opaque and layered with incongruent rules. It is quite possible consensus will eventually form around a new budget process that incorporates different parts of different approaches. We must ensure that they piece together in a cohesive and coherent fashion.

We are joined today by the Honorable Maurice P. McTigue, Vice President for Outreach at the Mercatus Center at George Mason University; John Hicks, Executive Director of the National Association of State Budget Officers; Scott Lilly, Senior Fellow at the Center for American Progress; and Dr. F. Stevens Redburn, Professorial Lecturer at the Trachtenberg School of Public Policy and Public Administration at George Washington University.

Thank you all for being here and for my colleagues for their continued attention and interest in this matter.

And with that I yield to the acting Ranking Member, Mr. Yarmuth.

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Price Statement on Tax Reform Task Force Report

2016/06/24

WASHINGTON, D.C. House Budget Committee Chairman Tom Price, M.D. (GA-06) issued the following statement on the release of the House GOP’s Task Force on Tax Reform report:

“Americans are spending too much of their time and too much of their money trying to make sense of the nation’s tax code. It is a burdensome mess holding back our economy, weakening our competitive edge in the world, and making it harder for individuals, families, and businesses to succeed. Thankfully, the Task Force on Tax Reform has put forward a serious proposal that should help us achieve the type of consensus we need to move a tax reform effort forward in a constructive manner. At the same time, it recognizes that the IRS as we know it has lost the trust of the American people and needs to be overhauled, broken down, and rebuilt so it is focused on a narrower mission.

“House Republicans have championed fundamental tax reform for many years – specifically a call for an overhaul of the current system in our annual budgets. We understand that we will not solve our nation’s serious fiscal challenges without having a healthier economy where more folks can get ahead. One of the best ways to make our economy stronger is to have a tax code that is simpler and fairer for all, and where Washington is no longer picking winners and losers. Fixing the tax code will incentivize job creation and investment, produce higher wages and more opportunity for hardworking Americans.”

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Price Statement on Trustees Report

2016/06/23

WASHINGTON, D.C. – House Budget Committee Chairman Tom Price, M.D. (GA-06) issued the following statement in response to the latest Medicare and Social Security trustees reports. According to the Trustees, Medicare's hospital insurance trust fund is expected to be insolvent in 2028 – two years earlier than previously estimated. Social Security will exhaust its reserves in 2034 after which the program will be able to pay only about three-quarters of scheduled benefits.

“The trustees have sent another wake-up call to Congress to get serious about reforming these critical programs. The health and retirement security of millions of Americans are in jeopardy, and yet the president and Democrats are happy to ignore this predictable crisis and impede any efforts to avoid it. They are putting American seniors at risk and our nation’s fiscal and economic future at risk. While President Obama and Democrats in Washington are willing to walk away from their responsibilities and leave the next generation to clean up the mess, House Republicans and the House Budget Committee are not.

“We understand what is at stake, and that is why we have consistently included positive solutions in our budget resolutions that would provide seniors with more choices when it comes to Medicare while protecting and preserving the program. Additionally, we encourage Congress and the president to begin the process of improving Social Security so we can ensure its long-term solvency. Through the committee’s Restoring the Trust for All Generations initiative we are further raising awareness about the fiscal and policy challenges inherent in these programs, and the unique impact they have on Americans in every stage of life. We must build a critical mass of support across this country and in Congress to take action and make improvements before time runs out.”

 

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Price Opening Statement: Making Budget Enforcement More Effective

2016/06/22

As Prepared for Delivery

Over the past several weeks, this committee has held hearings focused on different aspects of our effort to reform the Congressional budget process. Budget enforcement – the subject of today’s hearing – has been a part of the discussion from the very beginning. And the reason is obvious. A budget that is not enforced – is not effective. Moreover, the budget process Congress ultimately adopts will only be successful if Congress is willing to enforce the budgets it approves.

This is a two part discussion. We must determine what rules and limits we believe are reasonable and worth adopting and maintaining. At the same time, we have to determine how we will force Congress – through both Republican and Democratic leadership – to abide by those rules and limits.

The current process is not without enforcement mechanisms. You could even argue they are too numerous to be actually effective or, at the very least, too confusing and disjointed. At the congressional level, we have the Congressional Budget Act itself which prescribes certain enforcement tools. We have the annual budget resolution that when adopted provides for additional enforcement measures. And, we have the rules of the House that members vote on each Congress. In law, there is PAYGO – which has the unfortunate effect of making current debt or deficit levels seem ok so long as we don’t add to them – and the current Budget Control Act caps on discretionary spending coupled with sequestration which have proven to be problematic in their own right – each trading thoughtful budgeting and prioritization for across the board cuts that treat almost all government spending as equal and worthwhile. 

One of the more troubling aspects of the current budget enforcement environment is how easy it is to waive budget protocols – often with little or no recognition that Congress is agreeing to violate its own rules. This is a chronic problem, and it undermines the integrity of the process as a whole. While we can all imagine instances where it might be reasonable to expect Congress might need flexibility to temporarily forgo certain restrictions, we all should be able to agree that it should be a lot harder and less convenient than it currently is for Congress to break its own rules.

In the absence of a truly effective budget enforcement system, Congress has spent decades adopting, and often discarding, various avenues to control spending. Whether it be a “super committee,” the occasional attempts at a “grand bargain,” continuing resolutions in lieu of the regular appropriations process, or the aforementioned sequestration – to name just a few – Congress has tried and largely failed to create consistency and coherency in its budget enforcement efforts.

What is worse, too often policymakers have sought to ship the responsibility for enforcing spending discipline to the Washington regulatory regime. Nowhere has this been more prevalent than in the mandatory spending side of the ledger – namely the Medicare program. You’ll remember the now discarded Sustainable Growth Rate formula that was meant to tamp down the growth in federal health care spending but instead simply succeeded in threatening access to healthcare for America’s seniors. Thanks to current healthcare law, we currently have the Independent Payment Advisory Board, or IPAB, a board of unelected, unaccountable bureaucrats tasked with saving money by denying payment for and thus access to health care services for beneficiaries.

If Congress is willing to have a rational and realistic conversation about the nation’s fiscal challenges, there is no need to hand over control of tough decision-making to regulators. In fact, that sort of structure only weakens Congress’ power of the purse – as prescribed by our Constitution – and it diminishes the role of the budget in the broader legislative process.

Ultimately, to strengthen our budget enforcement, we must streamline and make coherent the rules by which we choose to govern our fiscal well-being. We need to make a violation of those rules – whether or not it is the will of a majority of Congress – more obvious so policymakers may hold themselves accountable and be held accountable by the American people. Such a structure would hopefully make a waiver of our rules the exception and not the norm – as currently exists.

To discuss where we go from here, we have as our witnesses today William Hoagland, Senior Vice President at the Bipartisan Policy Center; Barry Anderson, an independent consultant; and Richard Kogan, Senior Fellow at the Center on Budget and Policy Priorities.

Thank you all for being a part of this conversation. We welcome you and look forward to hearing your thoughts on how Congress can enhance enforcement of our budget process.

And with that, I yield to the Ranking Member, Mr. Van Hollen.

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A Better Way to Fix Health Care

2016/06/22

WASHINGTON—House Republicans today unveiled a plan to replace Obamacare. It is our vision for a Confident America in which every American has access to quality, affordable health care. This is the fifth plank of A Better Way, a bold agenda to tackle some of our country’s biggest challenges.

Our plan—available now at better.gop—offers a better way to fix health care, including:

  • More choices and lower costs. Our plan gives you more control and more choices so that you can pick the plan that meets your needs—not Washington’s mandates.
  • Real protections and peace of mind. Our plan makes sure that you never have to worry about being turned away or having your coverage taken away—regardless of age, income, medical conditions, or circumstances.
  • Cutting-edge cures and treatments. Our plan clears out the bureaucracy to accelerate the development of life-saving devices and therapies.
  • A stronger Medicare. Our plan protects Medicare for today’s seniors and preserves the program for future generations.

Task Force on Health Care Reform. Later today at AEI, House Speaker Paul Ryan (R-WI) will talk about these ideas alongside members of the Task Force on Health Care Reform, which includes: Budget Committee Chairman Tom Price (R-GA), Education and the Workforce Committee Chairman John Kline (R-MN), Energy & Commerce Committee Chairman Fred Upton (R-MI), and Ways & Means Committee Chairman Kevin Brady (R-TX).

About A Better Way. A Better Way is a bold policy agenda to address some of the country’s biggest challenges. It takes our timeless principles—liberty, free enterprise, consent of the governed—and applies them to the problems of our time. Developed with input from around the country, it starts the debate now on what we can achieve in 2017 and beyond. It is our vision for a Confident America, at home and abroad. Now we are taking these ideas to the people, so you have a clear choice about the direction of the country. Previously released plans include:

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Contact Information

207 Cannon HOB
Washington, DC 20515
Phone 202-226-7270
Fax 202-226-7174
budget.house.gov


Membership

Diane Black

TENNESSEE's 6th DISTRICT

Marsha Blackburn

TENNESSEE's 7th DISTRICT

Rod Blum

IOWA's 1st DISTRICT

Dave Brat

VIRGINIA's 7th DISTRICT

Tom Cole

OKLAHOMA's 4th DISTRICT

Mario Diaz-Balart

FLORIDA's 25th DISTRICT

Scott Garrett

NEW JERSEY's 5th DISTRICT

Glenn Grothman

WISCONSIN's 6th DISTRICT

Vicky Hartzler

MISSOURI's 4th DISTRICT

Tom McClintock

CALIFORNIA's 4th DISTRICT

John Moolenaar

MICHIGAN's 4th DISTRICT

Alex Mooney

WEST VIRGINIA's 2nd DISTRICT

Gary Palmer

ALABAMA's 6th DISTRICT

Tom Price

GEORGIA's 6th DISTRICT

Tom Rice

SOUTH CAROLINA's 7th DISTRICT

Todd Rokita

INDIANA's 4th DISTRICT

Mark Sanford

SOUTH CAROLINA's 1st DISTRICT

Marlin Stutzman

INDIANA's 3rd DISTRICT

Bruce Westerman

ARKANSAS' 4th DISTRICT

Steve Womack

ARKANSAS' 3rd DISTRICT

Rob Woodall

GEORGIA's 7th DISTRICT

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