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BUSH=S TAX CUT: A RETURN TO DEFICIT SPENDING The President is proposing a deep tax cut wile,
at the same time, proposing substantial increases in federal spending
thereby increasing the deficit. The President=s tax cut will
create a record deficit. With the President=s plan creating a record deficit,
the American public must ask whether President Bush=s tax cut is sound
economic policy or a Apolitical gimmick.” The American public
must ask whether the President=s deficit-producing plan is a plan that
will continue to sink the Federal Government into debt. In order to provide a stimulus package for economic
growth, the President should take action to reduce the deficit, balance
the budget and restructure our tax system. In doing so, President
Bush should consider: 1. In many states, like Tennessee, the primary
source of state revenue is the sales tax. Why isn’t the President
suggesting that the sales tax become a deduction on our federal taxes?
In order to provide us with a plan for economic growth, the plan cannot
simply call for a tax cut, it must call for true tax reform—tax reform
including innovative ideas like making the sales tax deductible in
certain situations. 2. Fuel taxes. Between federal and state
taxes on gasoline, we pay almost 37 cents a gallon for gas. The
President=s tax cut plan does not address reducing the gas tax or
revamping the gas tax making gas more affordable for Americans.
Moreover, what about making the payment of state gas taxes deductible on
our federal income tax return? 3. Small-business owners pay a self-employment
tax. The President=s plan does not address the self-employment tax
or any reduction in the self-employment tax to lighten the burden on a
small-business person. 4. What about making other state and local taxes
deductible on the federal income tax? Many businesses in many
states must pay a state franchise and excise tax. Moreover,
professionals in states like Tennessee must pay a professional privilege
tax. Many local governments include city personal property taxes
and county taxes. 6. What about property taxes? In order to have sound economic plan to help people
reinvest money into the economy, the President should propose a plan
that includes deducting certain state and local taxes on our returns and
giving us an opportunity to save money and reinvest it into the economy. The President=s plan is not for tax reform. It
is a tax cut, a simple fix that will cause the budget deficit to grow.
The plan is not comprehensive. In order to stimulate the economy the President must
realize that real tax reform means changes in the system to provide us
with incentives to invest in the economy. The President must also
present a realistic budget, wisely using tax dollars to provide valuable
services to the public. The budget should eliminate deficit
spending. Unfortunately, the President’s plan does not
restructure our system. It is a plan that returns government to
the deficit spending of the past. It is time for our leaders to move beyond the
political “tax cut” gimmicks. If this President wishes to
stimulate the economy, he should: 1. Propose meaningful long-term tax reform,
restructure the federal income tax system to lighten the tax burden, and
examine new ways to provide meaningful deductions for those who pay a
wide variety of state and local taxes. 2. Propose a balanced budget. The
President cannot ignore the growing deficit. If the President
plans a short-term deficit to fund the war on Iraq, the President should
honestly tell the American public that tax cuts would have to wait until
we deal with the current crisis in Iraq. The President, however,
is taking the opposite approach—offering a politically popular tax cut
while sinking our government deeper into debt. Meaningful tax reform is not easy. It becomes
more difficult as the threat of war becomes real. Unfortunately,
our President is caught up in a political gimmick designed to increase
poll numbers. Until this President gets beyond the politics of
Atax cuts@ and gets down to the real economic management of our
government, deficits will grow and the economy will stagnate.
Returning us to the deficit spending of the past is a serious mistake; a
mistake that will cost us more than this tax cut will give. This President, however, has not learned from the
mistakes of the past. |
