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Finally there's something real going on in Washington. The Republican Congress has passed a tax-cut package. A Democratic President has announced he will veto it. The Republican Congress is taking a recess, during which members are supposed to visit their constituents to build public pressure that will force the weak-willed President to change his mind about the veto.
And if he persists in the veto, the Republican Congress will have a gold-plated campaign issue for next year: We wanted you to keep more of your hard-earned money, and the Democrats didn't.
So far, so good. That's what politics is supposed to be
about, rather than youthful indiscretions.
But
there's more to this than a mere change in some federal tax
rates.
For starters, consider this headline from yesterday's
Wall Street Journal, that well-known left-wing
friend-of-the-working-man newspaper: Tax Bill is a Boon
for Corporate America.
In other words, it's about putting more money in
corporate pockets, not your pockets, despite the populist
rhetoric from the GOP. Multi-nationals will get to keep
more of their hard-earned money
from selling arms to
foreign countries, taking each other out to lunch at swank
bistros and transferring funds in and out of tax
havens.
Another misleading term in the GOP spin is death
tax.
Properly, it's an estate tax.
The
government does not yet levy taxes on death; it levies
taxes on estates when they are passed to heirs.
I'm no fan of any tax, but I do respect honesty. Just
call it preservation of inherited wealth
rather than
repealing the death tax.
If Daddy's money -- after
providing private tutors, prep schools, Ivy League
education, grad school, tailored clothes, capped teeth and
a cushy position in the company -- hasn't made a success of
you yet, then you certainly need every nickel of the
paternal estate when the time comes.
Another GOP target is the marriage-penalty tax.
This one could be fixed in an afternoon if they wanted to.
Just allow couples to compute their returns both jointly
and separately, and pay whichever is less.
But the most surprising aspect of this is that we see all these Republicans who adore Ronald Reagan's legacy, but forget how he got elected.
Go back to 1980, and I well remember a televised Reagan speech where he tore into the national debt, then approaching $1 trillion. If you printed a trillion dollar bills and stacked them, he said, they would reach the moon, and he pledged to start paying down that debt while eliminating the cabinet departments of energy and education.
After gaining office, Reagan did no such thing during his eight years, of course. Instead of eliminating cabinet departments, he added one, the Department of Veterans Affairs. The national debt stood at $997.9 billion when Reagan took office in 1981, and at $2,857.4 billion when he left office in 1989.
By the time his anointed successor, George Herbert Walker Bush, left the White House in 1993, the debt was at $4,411.5 billion. At last report (1997), it was $5,413.1 billion.
If we need to assign responsibility, we can say that $3,416.6 billion (63%) of the debt was accrued during 12 years of Reagan and Bush, and the other $1,999.5 billion (37%) was accrued during the other 209 years that the United States of America could borrow money, which included two world wars, a civil war, the Great Depression, etc.
Interest on the national debt ran to $355.8 billion in 1997, more than the federal government spent on Defense ($258 billion) or Health and Human Services ($340 billion).
So it appears that the sensible course, if the federal budget is running at a surplus and the economy is humming along, is to start paying down the debt. In the long run, it saves money, since less will have to go out in interest.
Republicans have been promising this for years, but instead of delivering, they give us bigger debts. Note that income taxes are collected from working people, and interest payments go to wealthy people who hold treasury notes and bills. The larger the deficit, the more interest to pay, and the more the government can collect from the poor to transfer to the rich. This is why Republicans never deliver on their promises to reduce the national debt.
But Sen. Phil Gramm of Texas says we've got to cut taxes, rather than earmark a surplus for paying down the debt, because if the money goes to Washington, it's like a honey pot in the woods, and all the bears will show up and grab it.
In other words, Congress cannot be trusted to be
fiscally responsible. That's a curious argument from a
prominent member of the party that controls both houses of
Congress. If he really believes that, why doesn't he say
Vote us out and get in some people you trust?
rather
than cut taxes so that the debt continues to climb and
more of your hard-earned money goes to coupon-clippers in
the Bahamas?
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