Plain Talk – 11.30.10
Posted: Wednesday, December 1, 2010 10:32 am
By: Nicolle Gallgher, Guest Columnist
The “Bush Tax Cuts” are set to expire at the end of the year. Perhaps you’ve heard? I wish the news coverage had been this intense when they were passed in the first place, maybe we wouldn’t be in the mess we are in now.
It was a pretty simple idea, a conservative tenant actually. Reduce the amount of revenue the federal government takes in (by lowering taxes) and you will by default, stimulate growth and reduce the size of government. Makes sense, right?
Most people don’t show up at their jobs for free. As much as they may enjoy their co-workers, we all expect to get paid at the end of the week. Who’s going to want to volunteer to annually audit the Oil Spill Response Plans for the 15,000 oil rigs in the Gulf of Mexico?
It certainly doesn’t sound like a fun way to spend a Saturday afternoon. And if taxes are lower, certainly, corporations are going to hire more workers. What else are they going to do with the extra money? Pay it as dividends? Sit on it? Invest it in China and other developing markets?
The theory didn’t work. Instead, we grew the size of the government, corporations shipped American jobs overseas. We borrowed unfathomable amounts of money to invade Iraq and Afghanistan.
We borrowed more money to fund a prescription drug benefit that leaves seniors without access to prescriptions for a few months a year. And then, just in case there was any doubt whatsoever that we had completely abandoned all pretense in the belief of fiscal responsibility, President Bush bailed out Wall Street at a cost of trillions of dollars.
Again, borrowed money. We Americans have yet to pay for any of this ourselves. That $300 billion dollars a year in voluntary revenue reduction combined with the $1.5 trillion in borrowed money was supposed to make our economy hum with productivity and growth.
Does it feel like it worked to you?
The only economically responsible thing we did from 2000 to 2008 is that we put an expiration date on the credit card, 12/31/2010; the expiration date on the Bush Tax Cut Experiment. The newly elected Republicans argue that if the richest Americans have to pay more in taxes, they will not create jobs.
If that were true why aren’t the billionaires creating more jobs now, while their taxes are still low. What are they waiting for?
The truth is that corporations and the richest 2 percent of Americans haven’t been paying their fair share in taxes for almost a decade. We put all of our eggs in one basket and put our economic future entirely in the hands of big business. They let us down and in the case of Goldman Sacs, they even betted against us.
Most middle class households pay a higher percentage of their income in taxes than the wealthiest 1/2 of 1 percent of Americans. Imagine that, a school teacher and a shop owner with two kids pay a higher percentage of their annual income in taxes than Paris Hilton in America.
At some point, all of the American people regardless of how rich they are will have to pay for the government that we’ve built and the wars we’ve fought. Unless we want to talk about massive cuts in Social Security and Medicare, now, not in 2020 or 2030, there simply aren’t enough “spending cuts” out there to bring us in balance.
The “pork” that everyone loves to demonize is going to bring 3,000 port jobs to Lake County when the port project is complete.
We could close every public university and elementary and high school in the country along with the entire Department of Education and we’d still be in debt.
We need to take in more revenue – not to keep growing, just to stay afloat.
We can decide to start paying for our decisions now, or we can wait until our debtors force us to buy, demanding higher interest rates in the bond market. Either way, we, the American people, will have to pay for our decisions. We just need to decide if the middle class will survive the payment plan.
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