Thanks to the miracle of Youtube (which was founded, developed, and brought to market with zero government assistance) I was able to watch the president's campaign speech last night...
Did I miss something? Have we all been transported to a parallel universe? Tax rates are now called "spending in the tax code"? I think I need my tin foil cap and some kite string, because we are not in Kansas any more.
First, let's get a few things straight. The current top marginal tax rate is just that, the current top rate. It is not "the Bush Tax Cut". That phrase, so well worn in the media, assumes that the current rates, implemented by former president Bush, broke some natural equilibrium for tax rates that is higher than the current rates. Such an assumption is pure hogwash. The top marginal tax rate has changed over 30 times since 1913. The current rates are not "cuts" that need to be restored to their natural order. They are simply the current rates, that are every bit as legitimate and natural as the 7% marginal rate or the 91% marginal rate. The argument is what rate optimizes revenue - through economic growth.
Second, reducing tax rates is not "spending". At least not in the universe in which we used to live. Apparently, according to Obama's speech, my income belongs to Washington and the amount I am allowed keep is now "spending". Well, that is in interesting turn of events. I guess the post office lost that piece of mail, because no one told me that my income belongs to Washington and that money I don't send to Washington is now classified as spending. Does Obama really believe this or was he just ginning up his base...of loonies who do believe that?
Let's agree on a few things before whatever planet we have been transported to explodes from the sheer madness of the inane budget talking points. First, the United States is broke. We are borrowing 40 cents of every dollar we are spending in the budget that just passed today. At some juncture, the rest of the world will be unable or unwilling to lend us the money we need. Second, the money we are spending today and will spend tomorrow is uncollateralized debt...there is no tangible asset to back this spending other than the promise of the US government to pay. China can't re posses grandma's knee replacement. The rest of the world is lending us trillions of dollars so we can continue to provide unsustainable government commitments. I wonder how much longer that will last? Second, people who are serious about getting the United States fiscal house in order don't hate old people, they don't want people in poverty, and they do not want kids eating dirt for dinner as many on MSNBC, Solon.com, moveon.org, etc suggest.
However, let's agree that there are choices we are going to be forced to make. If a federal school lunch program is our top priority, then fine. Fund it. But what are you going to be willing to give up? If keeping seniors medical care costs low is the best use of our scarce resources, great. What are you willing to give up so granny can get her sugar pills? We have no money, so in order to get those pills, somethng has to give. We don't have a revenue problem, we have a spending problem. The discussion moving forward needs to be centered not around whose pie can we confiscate so we can flush it down the toilet like we have done in the past, but rather deciding what are we willing to fund? What are the priorities of the country? This is the "national conversation" that needs to occur.
Suggestions? Okay, I have a few.
Cut the crap in the tax code. Get rid of loopholes and deductions? Fine, done. Broaden and lower that rates so anyone can file their tax returns with a pencil and paper in 30 minutes.
While we are at it, lower the corporate rate to 15% get trapped earning repatriated to the US and get GE, Google, and Boeing etc back on the tax rolls.
1% national sales tax...I am fine with that as it gets everyone vested in pulling the wagon....but only if we eliminate capital gain taxes to get the economic engine running again. However in order to raise the national sales tax, congress must have a super majority.
Raise the retirement age for Social security and medicare for anyone under 50 to age 70. Let anyone under 50 opt out of both if they so choose.
Base line for domestic spending...pick a year any year....2008...2005...2003. I don't care. Just pick one and that will be the baseline for domestic spending and we will make choices in what we fund and don't fund and go from there.
I can go on, but it is too easy. Hopefully the next time I get transported to another universe it will be one where people let me make the decisions and where UVa football wins at least 8 games a year :) Now that would be way out there.
3 comments:
Ah yes, the old zero sum game. The government's income base expands when the economy is good and everyone is making more money, but just as with citizens who make more money and expand their lifestyle accordingly, so does our government. We our leaders find that we have a few more dollars to spend, they fund a new initiative rather than use that extra money to pay down the debt. When the economy shrinks, lowering the tax receipts, those programs and initiatives still want full funding. When there are more mouths to feed than there is food, the process turns adversarial. Everyone wants to keep what they have, asking others to give up some of theirs instead. However, It's a zero sum game. In order for A to get more, it has to come from B (unless you are our government, which gives both A and B more and sells bonds to finance it.) I like your suggestions. Is the mortgage deduction really a sacred cow now that we have admitted that it really isn't every person's right to own a home? Simplify the tax code, make everyone pay the same percentage of their income, and make the hard choices about what we can continue to fund and what we can't. The government is not our collective momma—it was not created to cater to our every need.
Dear Otis,Agree completely w/ all you say-----Unfortunately,Sendog thinks the productive/working/not lazy/set the alarm clock and go to work folks have an obligation to anyone other than their family,their share of defense ,infrastrucure etc..Not true,especially now that we are truly broke!!!Fundamental truth is,if you want more of something subsidize it,less tax it------Gee, I wonder why half the country is dependant on the other and yes,there is a difference between a consumer and a contributor!
The govt is not our collective momma...or as Sgt Hulka was, the govt is not our big toe...I really don't think this problem is that hard to solve. While I have given up all hope that it will happen, term-liniting all fo these clowns would solve a myriad of problems. No career politicians when these dudes and dudettes have to come work in the real world once they term limit out.
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