Saving Tax Relief
In this year’s State of the Union address, President Bush called on Congress to protect the tax cuts it has passed since 2001.
That is a priority I strongly share. Tax relief has reduced the economic burden on every single tax filer in America.
Most economists agree that it has provided a critical boost to our economic recovery.
We’ve cut tax rates for 92 million Americans, increased the child tax credit, removed the marriage penalty, reduced the tax on dividends and capital gains, and gradually eliminated the federal death tax, which punishes American entrepreneurs, farmers, and small-business owners who want to pass on their life’s work to their kids and grandkids.
Many Americans are unaware that, because of the way the legislation had to be passed, all of those tax cuts expire within 10 years. (Some even sooner.)
Unless Congress acts, the taxes of every American will increase. Parents will lose much of the child tax credit.
Many families of entrepreneurs and small-business owners will once again be forced to sell their farms or family businesses just to pay the death tax to Uncle Sam.
A sharp rise in taxes will hamper many Americans’ ability to save money for college or retirement. If the past is any guide, consumer confidence will weaken. Businesses will reduce investments. And once again, the health of our economy will be at risk.
One would think preserving tax cuts would be a relatively easy thing to do.
After all, these cuts have already been passed by Congress. More to the point, it’s your money to begin with.
Yet when President Bush called for making tax relief permanent in last week’s State of the Union speech, most of the Democratic half of the Congress sat on its hands. And nearly every single Democrat running to replace President Bush has promised to repeal part - or all -- of the tax relief already in effect! This would be an immediate tax increase for all taxpaying Americans.
We’ve heard their reasons many times: Tax cuts cost too much. They imperil urgent Washington programs.
They add to the deficit. But what it really boils down to is this: opponents of tax relief want to keep more of your money to spend on Washington programs.
That doesn’t mean they’ll spend the money wisely. In fact, Congress continues to spend your money at record rates, far more than the rate of inflation and at the highest levels since the Great Society. In just the last year, we’ve have to fight Democratic efforts to impose an additional $1 trillion - that’s $1,000,000,000,000 - in increased federal spending to our current deficit.
But both parties deserve their share of blame. A recent bipartisan energy bill, for example, included such “essential” projects as an indoor rain forest and million-gallon aquarium in Iowa; a $1 billion shopping mall in Syracuse; and $227 million for other shopping centers across the country, including one that would use federal dollars to subsidize a Hooters.
It’s almost laughable to think that anyone could honestly believe that Washington spends your money better than you could.
But isn’t that in fact what opponents of tax cuts are saying? That you don’t deserve to keep more of your money; Washington knows best how to spend it for you?
That Washington has done such a good job at caring for your tax dollars it deserves more of them, and you are selfish to think otherwise? After all, they seem to suggest, the federal government is just barely getting by as it is.
I happen to believe that the best way to help American families is to let them keep more of the money they earn.
So does President Bush. As he recently put it, “Jobs are created when the economy grows; the economy grows when Americans have more money to spend and invest; and the best and fairest way to make sure Americans have that money is not to tax it away in the first place.”
We should make the tax cuts permanent - every single one of them -- and we should speed up further tax reductions scheduled to be enacted over the next few years. That is the best way to come to the aid of American families, and should be one of our top priorities this year.