Thursday, May 29, 2003

 

Tax cut bill makes a fine mess

An editorial published in the News Herald of Cook County, Minnesota discusses how the tax cut bill just signed into law by President George Bush has made a mess of the income tax system in the United States. 

To make its points, the editorial refers to a speech made by Senator Mark Dayton on the floor of the Senate.

Here is what the editors had to say:

“They were careless people, Tom and Daisy – they smashed up things and creatures and then retreated back into their money or their vast carelessness or whatever it was that kept them together, and let other people clean up the mess they had made.” F. Scott Fitzgerald, "The Great Gatsby”

The tax bill just passed by the U.S. Congress is the work of careless people.

Senator Mark Dayton delivered a scathing address on the floor of the Senate last week, calling “this tax bill is one of the most dangerous, destructive, and dishonorable acts of government that I have ever seen. It is a shameful looting of the federal treasury by the rich and powerful in America -- compliments of their friends in Congress.”

The Senator is correct.

Figures lie and liars figure, as the saying goes, but Dayton’s figures are irrefutable. Simply stated:

• If you take in over $1 million per year, you get a tax cut averaging over $93,000 in the first year.

• If you are married without children and make less than $50,000 per year, you get a tax cut of $100.

• Single people making less than $35,000 per year get a $50 tax cut.

Given the median income of Cook County is in the $37,000 range, there should be few local celebrations of this new tax bill. The savings per family or individual wouldn’t buy gas and groceries for a week. Of course, those getting the mega-breaks might come here and spend a bit of their largesse.

Dayton, a millionaire many times over by birth, is nonetheless outraged by this, saying “This tax bill ends this country’s progressive tax code, and it replaces it with a perverse tax code.” He suspects that it will be a permanent replacement, not a short-term remedy to jump-start the economy. If that happens, he predicts a burden on this nation of $2.3 trillion in lost revenues.

Where will that money come from? Social Security and our unborn children, he said. This was not the deal Dayton envisioned when he won his Senate seat.

“When I arrived in the Senate almost 2 1/2 years ago, I was so optimistic that we would make lives better throughout America by sharing our abundance. President Clinton and Congress, at that time, with an expanding economy, produced the first budget surplus in the on-budget account in 40 years, and the surpluses were projected to continue for each of the next 10 years.

“The other big fund of the federal government, the Social Security Trust Fund, was also expected to run sizable surpluses for the next decade. What a great opportunity. There could be prescription drug coverage for seniors, the long-promised federal share of 40 percent funding for special education, and, more important, still be fiscally responsible.

“Now it has all been thrown away -- or given away -- to those who do not need it and kept away from those who do.

“This year’s combined federal budget deficit will be around $400 billion, even though the Social Security Trust Fund will be running a $160 billion surplus. That means the non-Social Security account of the federal government, the so-called on-budget account, which is almost all the rest of the federal government’s operations, will run a deficit of about $550 billion -- after running a surplus just 3 years ago.

“In fiscal year 2000, the federal on-budget revenues, which come almost entirely from personal and corporate income taxes, from estate taxes, capital gains taxes, and excise taxes, totaled 101 percent of expenditures. This year, they will scarcely cover two-thirds of expenditures.

“The tax base of the federal government is being destroyed. Who will tell the American people? It is hard for anyone to discern the truth from all of the conflicting words and numbers; but the American people must learn the truth. They also must act, because the looting of America will not stop until Americans stop it,” Dayton said, ending his address.

What a mess. What a cleanup job.


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