The Debate Over Whether the Bush Tax Cuts Should Be Allowed to Expire
It is absurd but quite interesting following the raging debate over whether or not the US Congress should allow tax cuts instituted during the Bush administration to lapse. While it is absurd to the degree that the core arguments tendered in support of their reinstatement border on befuddled illogic, it is interesting being that much of the fuss amounts to little more than political theater in a purportedly heated mid-term election season.
True to long-standing ideological positions, the Republicans (and their Tea Party comrades) staunchly support an extension or renewal of the cuts. They contend that doing otherwise would not only negatively impact investment (the main engine of growth, small business) but further weaken a scruffy and already terribly battered economy.
Democrats on the other hand generally favor allowing the cuts to expire only for wealthy Americans, those making in excess of a quarter of a million dollars a year. The major thrust of the argument in this case being that it is only fair and equitable for the top earners to shoulder more of the burden; that reversing the tax on the larger population would shrink spending and exacerbate an economy that is lethargic, if not comatose.
A reasoned argument could and has been made to buttress the fact that neither of the foregoing positions in its purest form would guarantee the desired reprieve. However, I do find suggestions that the cuts be extended, amplified and/or permanentized both indefensible and unconscionable, especially in an economic climate that has seen millions of Americans lose their jobs and most, if not all, state and local governments grapple with the real possibility of bankruptcy.
There have been several treatises and testimonies from hundreds of prominent economists (including Alan Greenspan and up to five Nobel Prize winners in economics) that the cuts should never have been introduced in the first place since they increase inequality and cause deficits to balloon.
But one really needs not go far or necessarily invoke proven economic theories to articulate a cogent justification for allowing the cuts to lapse.
Since it is widely accepted that 30-51% of current deficit figures are attributable to these cuts, it is simply voodoo economics to assert that cutting taxes and, by so doing, reducing revenues and further decreasing the government’s overall ability to fund essential services, at a time when trillions of dollars have been racked on the backs of generations unborn, is the way to go.
It is classic double-speak for the same conservative interests that have so passionately argued against any government actions that could aggravate the current deficit situation to now turn around and champion one that is the single, most-damning contributor to the crisis. Whatever happened to their self-righteous sensibilities about fiscal responsibility; you know, those often recited platitudes about making sure that we didn’t bequeath this burden to our children and our children’s children?
It is equally disingenuous of liberals to pander to the masses by embarking on a course that could add hundreds of billions of dollars to the deficit. The citizenry needs to be enabled to come to terms with the centrality of a truly progressive tax code to the emergence of a new society where every member’s transcendental, existential needs are adequately satisfied.
Not only must the Bush tax cuts, in its entirety, be allowed to lapse, Congress must rise to the challenge of the present crisis by being insightful and courageous enough to shun traditional political banter and take other related crucial measures (like extending existing unemployment compensation coverages, initiating a new series of federal stimulus aid to states/local governments facing huge budget gaps and almost unavoidably major staffing cuts, drawing down commitments to the Afghani/Iraqi wars and slashing federal military spending, etc.) to ensure that the country remains on a steady course to full economic recovery.