REFLECTIONS

Posted on July 29, 2010

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THERE IS NEVER A FREE LUNCH

Today the  Republican argument about taxes boils down to two principles, and both are misguided.

First, people believe taxes can be reduced, but they should never be allowed to be raised. Second, whatever the level, taxes are too high.

Think back to the beginning of the Bush administration tax cuts. The argument was that the budget surplus was too large.

The President assured us in February, 2001, that the government had ample cash to cut taxes for everyone, protect the Social Security surplus, set aside $1 trillion over the next decade for “additional spending needs” and pay down the national debt.

You know what happened. The refund came. The supposed surplus vanished. The Social Security surplus was spent. Instead of reducing the national debt of $3.3 trillion, it ballooned to $9 trillion. The Bush administration never set aside $1 trillion for additional spending needs.

And we entered wars in Afghanistan and Iraq without raising taxes to pay for them. The only thing that remained the same after February, 2001, is the clamor for more tax cuts. We cannot get something for nothing because someone has to pay for it. The trickle down theory is not working.

Today it is the same argument, but the rationale is different. The Bush tax cuts are to end this year. Now the argument is the tax cuts must be extended to everyon because the economy is too shaky.

It is time that Congress accepts the reality that the government needs more revenue. Congress should let the Bush tax cuts lapse.

Also, we need to pull our military forces out of Afghanistan and continue the pull out in Iraq.

As the economy improves we may need an additional tax to reduce the national debt.

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