There's No Such Thing As Deficit Taxing
July 28, 2016 at 4:25 p.m.
I noticed something curious in the news this week.
The U.S. government has returned to deficit spending. (That's not the curious thing. It's a set up for the curious thing.)
Anyway, when the government closed the books in late 2002, it was reported that the government spent $159 billion more than it took in.
It was quite a turnaround. At the end of 2001, the government was $127 billion in the black.
Prospects for the next year are only a little better, or a little worse, depending on whose estimate you care to consider. The White House says the deficit in 2003 will be $109 billion. The Congressional Budget Office says $145 billion.
Any way you look at it, the days of budget surplus seem to have ended.
Of course, Democrats were quick to blame the return to deficits on W's tax cuts. The true blame lies with a flailing economy and a floundering stock market. Those two things caused tax receipts to fall dramatically.
At the same time, the war on terrorism has chewed up large chunks of budget revenue.
But no matter. Blaming the deficits on W makes for good politics.
But here is a curious thing I noticed earlier this week. On Thursday, Associated Press reported the Democrats were railing against the White House over the deficits.
The Demos were reported as saying that now is when the government should be running surpluses to help buttress Social Security and Medicare for the retirement of baby boomers in less than a decade.
And there was this from Sen. Kent Conrad of North Dakota, lead Democrat on the Senate Budget Committee:
'It's amazing how their story has changed, and their justification for plunging the nation back into deficits has changed."
I would agree that the "plunging" is a bad thing. Deficits can't be cast in a positive light.
So how do the Democrats respond?
On the same day, the AP ran another story on the Washington wire.
This one was explaining how the Democrats in the Senate were seeking to spend more than what the Republicans were seeking in a huge spending bill.
The bill combines 11 measures covering spending in departments government-wide.
A version of the bill was approved but never enacted last summer when the Democrats were in control.
Now, there isn't quite enough spending going on to satisfy the Democrats since the Republicans are running the show.
Demos say the current measure is $9.8 billion short of what they approved last year.
Why? Because "the needs are still there as plain as ever," said West Virginia Demo Robert Byrd.
The measure offers $3.1 billion to drought-affected farmers. The Demos want $6 billion.
The measure offers $763 million for Amtrak. The Demos want $1.2 billion.
The Demos want an additional $5 billion for security in ports and around nuclear plants.
This is curious to me.
On the one hand, the Demos are chastising W and the GOP for deficit spending. But on the other hand, they are fighting for more spending in a Senate appropriation bill?
It would seem, if Democrats were really concerned about deficits for reasons other than political fodder, they would get on board with the GOP and lighten up the spending bills, wouldn't it?
No, guess not. I guess I've got it wrong again.
It's not the spending that's the problem. It must be the tax side. The government, especially under W, simply isn't collecting enough taxes.
That's it.
To be sure, the Republicans are doing some spending of their own. They added $825 million for the costs of fighting last summer's wildfires, $3.9 billion for last-minute defense items, $1.5 billion for states to modernize voting systems and $1.5 billion to boost Medicare reimbursements to rural hospitals and doctors.
The drought, election and Medicare funds weren't in the original bill, so the GOP cut 1.6 percent from every other program in the huge measure to pay for them.
At least they're trying to set limits on spending.
But every time they do, the Democrats cry foul. There will be negotiations and compromises and the bottom line will be increased spending.
And higher deficits.
If W's taxing policy can boost the economy, tax revenues will increase.
But my guess is Congress will spend it all and them some.
I wish all the members of Congress would think in these terms.
They call it deficit spending for a reason. You never hear anybody say deficit taxing. [[In-content Ad]]
I noticed something curious in the news this week.
The U.S. government has returned to deficit spending. (That's not the curious thing. It's a set up for the curious thing.)
Anyway, when the government closed the books in late 2002, it was reported that the government spent $159 billion more than it took in.
It was quite a turnaround. At the end of 2001, the government was $127 billion in the black.
Prospects for the next year are only a little better, or a little worse, depending on whose estimate you care to consider. The White House says the deficit in 2003 will be $109 billion. The Congressional Budget Office says $145 billion.
Any way you look at it, the days of budget surplus seem to have ended.
Of course, Democrats were quick to blame the return to deficits on W's tax cuts. The true blame lies with a flailing economy and a floundering stock market. Those two things caused tax receipts to fall dramatically.
At the same time, the war on terrorism has chewed up large chunks of budget revenue.
But no matter. Blaming the deficits on W makes for good politics.
But here is a curious thing I noticed earlier this week. On Thursday, Associated Press reported the Democrats were railing against the White House over the deficits.
The Demos were reported as saying that now is when the government should be running surpluses to help buttress Social Security and Medicare for the retirement of baby boomers in less than a decade.
And there was this from Sen. Kent Conrad of North Dakota, lead Democrat on the Senate Budget Committee:
'It's amazing how their story has changed, and their justification for plunging the nation back into deficits has changed."
I would agree that the "plunging" is a bad thing. Deficits can't be cast in a positive light.
So how do the Democrats respond?
On the same day, the AP ran another story on the Washington wire.
This one was explaining how the Democrats in the Senate were seeking to spend more than what the Republicans were seeking in a huge spending bill.
The bill combines 11 measures covering spending in departments government-wide.
A version of the bill was approved but never enacted last summer when the Democrats were in control.
Now, there isn't quite enough spending going on to satisfy the Democrats since the Republicans are running the show.
Demos say the current measure is $9.8 billion short of what they approved last year.
Why? Because "the needs are still there as plain as ever," said West Virginia Demo Robert Byrd.
The measure offers $3.1 billion to drought-affected farmers. The Demos want $6 billion.
The measure offers $763 million for Amtrak. The Demos want $1.2 billion.
The Demos want an additional $5 billion for security in ports and around nuclear plants.
This is curious to me.
On the one hand, the Demos are chastising W and the GOP for deficit spending. But on the other hand, they are fighting for more spending in a Senate appropriation bill?
It would seem, if Democrats were really concerned about deficits for reasons other than political fodder, they would get on board with the GOP and lighten up the spending bills, wouldn't it?
No, guess not. I guess I've got it wrong again.
It's not the spending that's the problem. It must be the tax side. The government, especially under W, simply isn't collecting enough taxes.
That's it.
To be sure, the Republicans are doing some spending of their own. They added $825 million for the costs of fighting last summer's wildfires, $3.9 billion for last-minute defense items, $1.5 billion for states to modernize voting systems and $1.5 billion to boost Medicare reimbursements to rural hospitals and doctors.
The drought, election and Medicare funds weren't in the original bill, so the GOP cut 1.6 percent from every other program in the huge measure to pay for them.
At least they're trying to set limits on spending.
But every time they do, the Democrats cry foul. There will be negotiations and compromises and the bottom line will be increased spending.
And higher deficits.
If W's taxing policy can boost the economy, tax revenues will increase.
But my guess is Congress will spend it all and them some.
I wish all the members of Congress would think in these terms.
They call it deficit spending for a reason. You never hear anybody say deficit taxing. [[In-content Ad]]