I am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible. The reason I am is because I believe the big problem is not taxes, the big problem is spending. The question is, “How do you hold down government spending?” Government spending now amounts to close to 40% of national income not counting indirect spending through regulation and the like. If you include that, you get up to roughly half. The real danger we face is that number will creep up and up and up. The only effective way I think to hold it down, is to hold down the amount of income the government has. The way to do that is to cut taxes.
Milton Friedman, September 16th, 2003
The Baltimore Sun has published an Op-Ed today that perfectly captures the latest Liberal Democrat talking point that the very idea the Bush tax cuts should be extended will make our national deficit even worse. Furthermore, they are completely apoplectic that some Democrats (this is only an election year ploy, they would never actually implement the cuts) are suggesting that we should extend the cuts to people who earn above $250K.
The argument is this: “George Bush cut taxes. George Bush started the Iraq war. George Bush is a bad man. Obama did the right thing to run the deficit to $1.4 trillion and George Bush squandered the budget surplus. Did we mention George Bush is a bad man. Now we can’t ‘afford’ the tax cuts.”
Several things completely lost on our intrepid,and Bush Derangement Syndrome inflicted, op-ed writer. First, congress has been controlled by Nancey Pelosi, Harry Reid and the Democrats since 2006. For nearly 4 years they have watched the stock market tank, unemployment rise, the housing market implode and deficits soar. Remember, Congress controls spending.
Government spending has skyrocketed under Pelosi, Reid and now Obama.. There is no discussion at the Baltimore Sun or among Democrats about spending cuts. They only are looking at tax increases.
Increasing taxes and governmental stimulus spending doesn’t work as evidenced by Japan and its Lost Decade.
The Sun’s op-ed writer acknowledges the pain the middle class is suffering due to the recession and that increasing taxes (i.e. letting the tax cuts expire) will cause additional economic pain. However, the Baltimore Sun op-ed writer and Democrats in general are now Deficit Hawks. After nearly two years with Obama, Pelosi and Reid on a spending binge of an unprecedented scale, when presented with an opportunity to extend tax cuts, our political leaders are concerned about deficits.
Today, the newly minted Deficit Hawks point out “the deficit is a really big problem” and is projected to be worse. They say that “Mr. Obama repeatedly promised never to raise taxes on the middle class (a promise we considered ill-advised, then and now), so he would no doubt take a political hit for letting the tax break for middle-class families expire. We, however, are far more concerned with the fiscal health of the nation than the president’s political fortunes.”
My question is, if they are so concerned about the “fiscal health of the nation” why are they not calling for spending cuts rather than tax increases? There is no discussion of canceling the the balance of the stimulus bill and using it to cut the debt. Why not call for the repeal of government run health care if they are afraid of future deficits? England is moving away from national health care because of costs and lack of efficiency. Germany is fighting the costs of their national health care system. It doesn’t work there. Why would it work here?
The truth is they only care about providing cover for liberal Democrats and advancing their progressive agenda.
