The congressional conflict over the mandated end of the Bush tax cuts has brought out
the usual "just say no" response from the Republicans. We are in the midst of the
worst recession in the memory of most Americans. Governments at all levels, city,
county, state and federal are facing huge shortfalls in revenues. These could lead
to drastic cuts in vital public services--police, firemen, teachers, sanitation,
maintenance of public facilities, etc. The revenue deficits reflect the collapse of
real estate values, the slowdown of economic activity and the rise in unemployment.
The Bush tax cuts were supposed to lead to increased private investment in economic
activity, creating new jobs and generating government revenues. After ten years
the predicted results have not happened. The tax savings to the wealthy were hoarded. Those for the middle class were too little to have a substantial economic impact. Job growth was anemic during the decade. But they did create the illusion
of wealth by the unreal increase in real estate prices (not values). Federal
Government intervention is now the only life support system with any promise of keeping our many jurisdictions functioning. But that will require revenues if we
are to avoid more dangerous deficit spending. So the tax cuts should be allowed to expire, but not for the endangered middle class. They represent the best hope
for an eventual turn around in the economy. The wealthy, who acquired the greatest
share of the national treasure during the Bush era, should now pick up the greatest share of the tax burden, which in the U. S. is lower than most of the developed nations of the world.
The Republican are refusing this sensible compromise. They are insisting on an all or none extension of the tax cuts. If they get their wish, will they still complain
about the huge deficits? Or will they further devastate the middle class by draconian cuts in programs and services which keep the middle class temporarily afloat?
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The blog entry “ Intransigent Republicans … “ is an interesting diatribe against the position of the Republican Party on taxes. Currently Republicans favor continuing existing tax exemptions.
Undeniably Government taxes are needed to pay our Government expenses.
In private life, most people who cannot meet their financial obligations have three choices: they must increase their income or borrow money or reduce their expenses. Same options for the Government except it rarely chooses to reduce expenses, instead it taxes more heavily or simply adds to the deficit.
Before removing the current controversial tax exemption, reduce the major expense of a war and of an occupation, decrease joblessness thereby reducing the cost of unemployment benefits and increasing the number of payers in the tax base.
This tax controversy sounds like a tempest in a tea party pot.
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