Playing Fair on Taxes
And they're being financed with borrowed money, which will have to be repaid, with interest, by taxpayers of the future. All of this as we face an aging population that will drive up the cost of government retirement programs with serious consequences for our future living standards in the form of higher taxes or lower benefits. Social Security will provide less of a safety net; Medicare will not be able to guarantee healthcare to older Americans; and Medicaid will no longer be able to help the poor.
The tax cuts on investment income should not be extended after they expire in 2010. One argument in favor of keeping the cuts in place is that eliminating them would hurt economic growth. Yet, when President Clinton raised the marginal rate on high incomes, the opposite occurred: Unemployment dropped without causing inflation; productivity and growth accelerated to levels not seen since the 1960s, and the budget deficit was converted to an impressive surplus. Government borrowing stopped draining the capital markets, freeing up money for private investment.
Nor can it be said that taking these new tax cuts from the wealthy would amount to class warfare. It is hardly class warfare to suggest that some of the $750 billion a year that the top 10 percent of income earners are taking in now should go to sustain the fiscal health of the country and the expansion of our middle class and to maintain America as a true land of opportunity.
Remember that job security, private pensions, and employer-provided healthcare coverage are being cut back. Remember that there is significant erosion in public services such as schools, colleges, transportation, health, recreation, and job training. Understand why large numbers of people in our society are feeling increasingly vulnerable. It is time to redress the balance.
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