December 17, 2002 7:16 AM

Tax policy for the wealthy and self-involved

New Tax Plan May Bring Shift In Burden

Before I even begin, I know I'm likely to get pilloried (go easy on me, Owen, I bruise easily) for sayng this, but John was nice enough to provide me with this link, so I'm going to say it, anyway. The federal government is trying to find a palatable way to increase the tax burden on the poor and middle class while decreasing the burden on the rich. Well, gee, who do you think bankrolled Shrub?

You can call it what you want. From where I sit, I'd call it reprehensible and a breach of trust.

Are you ready for this?

As the Bush administration draws up plans to simplify the tax system, it is also refining arguments for why it may be necessary to shift more of the tax load onto lower-income workers.

Yes, you read that correctly. Shrub and his minions are trying to find a politically palatable way to make the poor pay more taxes. Apparently, the rich white folks who helped elect Shrub are making the case that they are paying an unfair share of taxes relative to those who live in trailers and raise six children on one minimum-wage income.

Economists at the Treasury Department are drafting new ways to calculate the distribution of tax burdens among different income classes, which are expected to highlight what administration officials see as a rising tax burden on the rich and a declining burden on the poor. The White House Council of Economic Advisers is also preparing a report detailing the concentration of the tax burden on the affluent and highlighting problems with the way tax burdens are calculated for the poor.

I'm wondering whatever happened to the concept of "ability to pay"? If someone is pulling down six figures, that person should have an implied obligation to carry a larger burden, because he makes enough money to shoulder a larger burden. No, I'm not advocating socialism here, but ability to pay should be an important criteria of our tax system. The question here seems to be

Are too few wealthy Americans paying too much in taxes for too many, and should the working poor and middle class be shouldering more of the tax burden?

And what is so wrong with that concept? While I would never begrudge someone their financial success, I would argue that greater success also implies greater responsibility. Before the rich begin whining about their onerous tax burden, perhaps they could try walking a mile in the shoes of the poor and middle class. This is not a perfect democracy (e.g.- please see 2000 Presidential election), which means that some of us are going to have to shoulder a proportionally greater load. That's not unfair tax policy- that's recognizing financial reality.

I realize that using ability to pay as a criteria for tax policy is anathema to Conservatives, but I frankly don't much care. What is important from where I sit is that tax policy is equitable. The push towards a progressively flatter tax code will in the end benefit only those in the higher income brackets. Let's face reality here: 30% of $20,000 leaves a lot less disposable income than 30% of $200,000. Yes, I suppose, that those who make $200,000/yr. should be able to enjoy the fruits of their success. By the same token, those who make $20,000/yr. should not be denied what little fruit they can enjoy with whatever is left over.

Democrats say the shift could prove ominous for lower-income Americans. And they appear eager for the fight.

"These people are setting the tone in saying the poor really are not being taxed enough and that the burden is too high on the rich," said New York Rep. Charles B. Rangel, the ranking Democrat on the House Ways and Means Committee. "We're going back some 70 years."

Rep. Robert T. Matsui (D-Calif.), a member of the committee, said: "I don't think there's any question you have a number of extremists in the Republican ranks that would like to see the wealthy do very well. They're going to try to make the case that the average American is overtaxed and subsidizing the poor."

"Fairness" is not, and should not be the issue here, primarily because "fair" means something different depending on which side of the political spectrum you occupy. If things were truly "fair", Alex Rodriguez wouldn't be making $25 million per year for playing a kid's game while people struggle to raise their families on low-wage incomes. I'll settle for equitable. Of course, even that is a bit more than some conservatives can stomach.

But to some conservatives, the shift is long overdue. Rep. Jim DeMint (R-S.C.) has argued for two years that the nation is entering a dangerous period in which the burden of financing government is falling on too few people. In such an environment, the masses will always vote for politicians promising ever-more-generous social programs, knowing they will not have to pay for such programs, DeMint warned.

"This issue is coming to a head," DeMint said earlier this month, just minutes after making his pitch to outgoing Treasury Secretary Paul H. O'Neill. "You can't maintain a democracy if the people who are voting don't care what their government costs."....

"Workers who pay little or no taxes can hardly be expected to care about tax relief for everybody else," the editorial stated. "They are also that much more detached from recognizing the costs of government."

But advocates of this new line can expect a furious backlash. Liberal commentators have already reduced the argument to an appeal to tax the poor, and even conservatives worry that the label will stick.

For Shrub, the supposed champion of Middle Class America, to even be floating trial balloons on this issue smacks of hypocrisy. He was more than willing to accept the votes of Joe and Lorena Sixpack, but now that he's in office, there are bills to pay. And his rich benefactors are calling to collect.

Let's be reasonable here. The federal budget should not be balanced on the backs of the poor and the middle class. I'm certainly not saying that it is the sole responsibility of the financially successful to bankroll government. What I am saying is that they have a proportionally larger responsibility. Would it be too much to ask the rich to look beyond their own self-interest on this issue? I would hope not, but I'm beginning to wonder.

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This page contains a single entry by Jack Cluth published on December 17, 2002 7:16 AM.

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