by John M. Curtis
(310) 204-8700

Copyright July 18, 2000
All Rights Reserved.

stonishing true believers and skeptics alike, the Congressional Budget Office revised upward its estimates of the 10-year budget surplus from $1.2 trillion to a whopping 2.17 trillion, nearly doubling earlier projections. But before the report’s ink was dry, smoke started blowing from the White House to Capitol Hill. "It’s very clear that Republicans in Congress have decided to put aside their responsibilities and play politics," said presidential smoke-meister Joe Lockhart. But who’s really playing politics? Preempting Republican moves to repeal the estate tax and marriage penalty, Lockhart raised the specter of presidential vetos, unless the president gets his Medicare prescription drug benefit. Raking in more cash than a Las Vegas casino, the Clinton administration accused Republicans of pandering to the wealthy. "They are more interested in taking care of their wealthy friends than working families . . . I don’t think the American people are dumb. They don’t want the [surplus] money to go to tax cuts for the wealthy," said House Minority Leader Richard Gephardt (D-Mis.).

       Who’s he kidding? Yes, most Americans don’t want to be buffaloed by insatiable politicians euphoric over excessive budget surpluses. Why shouldn’t tax relief go evenly to all income earners? Sure higher wage earners stand to get the biggest chunk, but they also pay commensurately more taxes. If lower wage earners don’t make use of the current tax loopholes, that’s not the problem of higher income earners. Gephardt’s logic doesn’t jibe with the American way of working hard and eventually making it. Current tax codes cause the insidious 'bracket creep' leading to higher tax rates for bigger income producers. Citing propaganda from liberal groups like the Citizens for Tax Justice, Democrats maintain that nearly 58% of GOP tax cuts go the top 5% of workers earning over $130K a year, a real distortion of what’s really behind the marriage penalty. When working families earn $130K, it’s usually the combined income of two hard-working people—not, as some would have you believe, from one breadwinner.

       Even a $60K salary, which in many cases involves two hard working adults, represents a middle class salary. Why should married people be penalized for filing their taxes jointly and raising their individual tax brackets? When Rep. Gephardt refers to 'working families,' is he excluding middle class suburban families slaving away for a piece of the American dream? Democrats need to stop playing class politics, pitting stereotyped 'working families' against the mythological 'wealthy.' Families earning combined incomes exceeding $100K are working every bit as hard as families earning less. Republicans aren’t playing politics by finally correcting inequitable tax rates fashioned for a recessionary economy. With the raging bull market wiping out deficits and assuring astronomical surpluses, it about time that someone gets around to lowering tax rates to where they belong. Campaign finance reform is small potatoes compared to Washington’s ongoing tax piracy.

       Turning American taxpayers upside down, what automatic right does the government have to generate massive tax surpluses? What ever happened to balanced budgets? Sure there are endless ways to spend taxpayers’ money, including paying down the national debt, protecting social security and adding new Medicare benefits. With the Congressional Budget Office now doubling estimates of the surplus, the government’s greed has gone over the top. Ending the marriage penalty would reduce the mushrooming surplus by only $248 billion over 10 years, just $24.8 billion or 10% per year, still leaving a swollen surplus of over $200 billion with which to retire the debt and fund more entitlement programs. "All of these families contributed to the record surplus that we have in Washington," said Sen. William Roth (R-Del.), chairman of the Senate Finance Committee, "they deserve to get some of it back." While it’s more difficult to defend the marriage penalty, the president pulled no punches when it came to the inheritance tax.

       "There is absolutely no defense for us taxing people at their death, for taking away the fruits of their inheritance . . . or the fruits of their labor," said Senate Majority Leader Trent Lott (R-Miss.), following the Senate’s historic vote to end estate taxes. Playing fast and loose, President Clinton referred to the bill as a "budget buster," despite the fact that the expected loss of only $105 billion over 10 years reduces the projected surplus by 10.5 billion a year or only 5%. Hammering his point home with a straight face, "The Senate is wrong to pass this costly, irresponsible and regressive bill . . . When it comes to my desk, I will veto it," exclaimed the President. With only 2% of families paying inheritance tax, he continued the class wars, failing to consider the obscene nature of extracting taxes from rightful heirs. Even liberal Sen. Diane Feinstein (D-Calif.) broke ranks with the President, "The estate tax is unfair to many residents of my state who never thought, planned or expected to find themselves subject to the estate tax . . . And the simple fact of the matter is that the tax becomes a very large burden." Does any rational person really believe that already taxed savings should be subjected to taxes one more time?

       While it’s true that Republicans will surely make tax cuts a rallying cry for their upcoming convention, it’s also true that marginal tax rates have never been readjusted to accommodate record lows in unemployment and unprecedented capital gains from the 5-year-old bull market. With the Congressional Budget Office now doubling its surplus projections to $2.17 trillion, Washington must face the music and lower the current tax rates. No government of, by and for the people has the right to profit at its citizens’ expense. Tax rates must meet government’s basic responsibility, not gouge taxpayers by financing endless waste, mismanagement or utopian social experiments. No one denies that engineering a better society costs money. But taxpayers should clearly express their preferences and limits to government spending, rather than accept unchecked prescriptions for squandering public funds. With Washington flush with cash, it’s high time for legitimate tax relief. Calling it a "budget buster" just won’t cut it this time around.

About the Author

John M. Curtis is editor of OnlineColumnist.com and columnist for The Los Angeles Daily Journal. He’s director of a Los Angeles think tank specializing in human behavior, health care, political research and media consultation. He’s the author of Dodging The Bullet and Operation Charisma.

©1999-2000 Discobolos Consulting Services, Inc.
(310) 204-8300
All Rights Reserved.