Posted by: Calmseas (Mike) | April 26, 2011

Tax Cuts

Tax CutI have been trying to wrap my mind around the catchphrase “unpaid-for tax cut” for the last couple of years.  I am probably too thick-skulled and practical-minded to appreciate the concept; nonetheless, I came across a pretty good explanation of it on a blog recently.  The blog entry read:

You know exactly what “unpaid-for tax cuts” mean.  We have a budget.  In that budget, there is an expected revenue.  We intentiona­lly reduce that revenue without accounting for the loss of revenue.  That’s an “unpaid for” tax cut.

Now on the most elemental level, I can follow the logic.  I’m not stupid, after all; just thick-headed.  But it is my thick-headedness that won’t allow me to follow the thinking behind whatever logic I might be able to find.  As I think through the whole concept of “unpaid-for tax cuts,” I realize that the problem for me is that I reject the premise.  Let me explain.

“An expected revenue” presupposes that the government owns all, and by its great beneficence, it shares with its citizens a greater or lessor amount as government largess now and then.  “Belly up to the trough, boys.  We’re gonna throw out a little feed for you.  But not too much; just a enough to keep ya in line!” says Big Brother.

The government’s budget begins with “expected revenue.”  It spends “the expected revenue”—which really means “the expected spending”—and then starts charging to the public credit card from there.  The problem is never that the spending is too high; the problem, they imply, is that taxes are too low.  We can’t cut taxes, they say, because we would have to find a way to “pay for” those tax cuts.  After all, the expected revenue (read: “the expected spending”) must remain intact, according to the prevailing government group-think.

To my way of thinking, however, the money belongs to the people who earned it.  They give some of it to run their government.  A government’s budget should, therefore, start with a clean slate, a zero sum—not unlike a household budget, or a business’ budget, or the budget of a state or municipality.

What we are witnessing in Washington is the general disconnection of an arrogant and self-aggrandizing government from its citizenry.  We see a government that has gone grossly haywire, a government that is “out-of-touch.”  And, frankly, it makes little difference whether the government is run by Republicans or by Democrats.

Both political parties, while in power over the years, have developed budgets from the point of view that “the expected revenue/the expected spending” is the zero sum.  This is thinking that simply must change.  We are at a point where there will be no choice but to change the thinking.  Once the Chinese begin calling in their debts, and the full faith and credit of the United States becomes questionable, there will be neither money to spend nor credit to draw upon.  And we will find ourselves in a sad state of affairs.

How about a novel idea: Let’s spend only what we have.  How about a really radical idea: Let’s scale back the size and scope of government, which will allow us to cut taxes, even as we pay our bills with cash, and allow for economic enrichment of all of the nation’s citizens.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s


%d bloggers like this: