It is Time for America to Re-finance
The revenue problem: Why Republicans need to agree to higher taxes.
“We have a spending problem, we don’t have a problem because we tax too little.” Those now famous (or infamous, depending on how you look at it) words bellowed from the mouth of Senate minority leader Mitch McConnell have been heard time and again by any American with an interest in the future of our nation. The standoff on Capitol Hill between democrats and republicans over the debt ceiling was an ugly one. The effects of this battle may be felt for years to come, it is yet to be seen. While I saw myself leaning more toward the GOP side of the debate, I still do not feel like a winner. National media has been largely portraying this as a victory for Republicans, and, though I am not Republican, you would expect me to feel satisfaction knowing that, in this instance, the side I happened to agree with more “won.” My one word hiatus from the sense that our congress did something right: taxes. I could not agree more with McConnell; the senator from my home state, that we absolutely have a spending problem. In fact, the break-neck spending started by President Bush has only been accelerated by the Obama administration. However; I could not disagree more with McConnell when he insists that we do not have a revenue problem. The more we spend, the more we must take in: that is simple economics seeming to be ignored by Republicans in Washington. First we must stop spending, even if that means major program reforms. Once that is done however; we need more revenue, even if temporarily, to get this nation back on top of its finances. We cannot sit around and wait for revenue to balance our massive debt right now, it would be as if trying to pay off a 30 year mortgage on a the wages of a server in a diner: it is very difficult to do, and any unexpected emergency we may have to pay for (cue 2 major hurricanes and 2 costly wars in the last decade) will make it nearly impossible to pay down that massive debt. It is time for America to re-finance our mortgage, and pay off our debt faster. Having lived abroad for an extended period of time, I can personally attest to the opinion of many Americans with whom I have shared this experience that our nation is the preeminent land of happiness in the world. Nowhere else do people have the same freedoms, rights, privileges, and most of all, opportunities as we do while living under Old Glory. The experience of life here in the USA has a quality which other nations seem to lack. Republicans want to take advantage of this experience, and give nothing in return. The greatest products most always come with a bigger price tag; we are not shopping at a sovereignty supercenter, our product cannot be created easily. It is time that America pay in order to keep what we have; and we still will not need to pay taxes at the rate of some other developed nations.
In a Republican presidential debate in Ames, Iowa, GOPers were asked who would oppose a 10-1 (yes, I literally mean 10-1) spending cut to tax increase; every single candidate raised their hand. In effect, every republican running for head of state would refuse to cut 10 trillion dollars (about 70%) of our current deficit, in return for 1 trillion dollars in additional funding to pay off current debts. This kind of fiscal irresponsibility is what is driving Democrats, and many American voters, absolutely senseless. While I would be ecstatic to see a 10-1 cut to increase, I believe that is far too unrealistic. The United States has committed too much money in too many debts to too many places to have a cut that drastic; however, it is still so telling that Republicans would oppose such a beneficial scenario. It also goes without saying that a policy like that would be carved up by Democrats more than a fresh Thanksgiving turkey on my dinner table. I see a 4.5-1 deal as a much more plausible and agreeable deal. To translate what a 4.5-1 deal means: in 10 years we would cut 9 trillion dollars of spending, and raise 2 trillion dollars of additional revenue from taxes (this is about the same rate of taxation as before the Bush tax cuts). Moreover; if we believe Warren Buffett, the rich will be happy to shoulder a majority of this burden. To make this even more simple for the rising generation to understand: Those Americans just now reaching voting age would see 18 trillion dollars of spending cuts, and only 4 trillion dollars of additional taxes by the time their first born child even reaches voting age! Given a nearly 15 trillion dollar deficit, that means in 20 years we would see a 7 trillion dollar surplus in budget, as long as the government only spends money at the rate with which we are being taxed now. However, we know cannot unpretentiously assume our government will stop spending. Even as this article is being written, President Obama is signing into law the Office of Diversity and Inclusion. Before I go farther, it needs to be made perfectly clear that the idea of equality is not an idiocy at all; quite the contrary, equality is very much needed in the world, and in the United States. That being stated, the Office of Diversity and Inclusion is another example of spending which is not needed. In its purpose, the Office or Diversity and Inclusion will couple with, and compliment the Equal Opportunity Employment. Even if the new office is a virtuous idea, at this point in the fiscal tragedy of our nation, the last thing we need is more bureaucracy the lockup Washington, fight for power, and suck away more money.
Yet, if we continue on in our hypothetical fantasy, in which our government does only spend the money it is currently taking in, and not a penny more, even when taxes are raised; once we factor in interest owed on our debts, we may see 3-5 trillion dollars in surplus. Of course this would also require reforming some programs, such as social security and Medicare, which are schedule to guzzle the budget; however, it is widely believed that this needs to happen anyway.
It seems to make so much sense that it is hard for average American citizens to understand why this is not happening. Republicans are playing the anti-Obama propaganda game, saying that more taxes would kill jobs, and we would not even be in this problem if not for our current president in the first place. This is not quite accurate. Nearly half of our federal budget problem can be blamed on the George Bush Republican administration, so the GOP cannot play the high and mighty card here. As for the job killing which would come with tax increase, if you ask Warren Buffett, that is a farce. Taxes were higher between 1980 and 2000, during which time, he claimed, forty million jobs were created. This sounds like a very radical claim. Nevertheless, additional research will show Buffett may not be as far off the mark as Republicans would like to see. Between 1980 and 2000 taxes were much higher than they are now. Furthermore; we did see nearly 20 million private sector jobs created in that era of higher taxes. I can almost hear right wingers yelling at me right now through their LED screens that 20 million is only half of the argument I am attempting to support. I am trying to keep the facts, not mislead readers. Here is another fact for you. 20 million jobs completely dwarfs the rate of job creation under President Bush. Yet, we continue to hear Republicans shout their message from the rooftops: new taxes will kill jobs and cripple the economy. The right is always telling us that we need to function as we did in the Reagan years: I could not agree more. The spider on the wall which Capitol Hill Republicans refuse to admit, or just ignore all together, is that Reagan raised taxes more times than he lowered them. Some of the largest peacetime tax increases in American history came from the GOP banner-man himself. The anti-revenue contingents on the right need to stop fantasizing Reagan mythology, most particularly when it comes to the welfare of our nation. When Reagan did cut taxes, immediately after first being elected, unemployment actually grew; and so did the size of the Government (though admittedly, it was not as colossal as it has become today under our current administration). What made Reagan such a grand President is that he was willing to compromise—a word that has become a synonym to cowardice in Washington today. Reagan did what was right for our nation, not what was right wing; now as much as ever we need our right wing to do what is right as well.
I am not attempting to support of attack either President Bush, or President Obama in this article, I fully believe each has done what they felt was right for our nation during times of crisis. The simple truth is, no matter who we blame, we have a muddled financial situation we need to deal with now. Moreover, if we fail to find an antiquate fix now, the problem will only grow, and be left for our children and grandchildren to muscle their way out. We cannot set this nation up for failure when we pass it off to the next governing body and voting class. America is the greatest land on the Earth; Republicans need to put their petty bitterness behind them: this is not about winning an election next year; this is about winning the future of our nation. If Republicans fear that losing another election will sweep their party away into obscurity, they should also consider this: if the next generation or two can look back and see a deficit problem which grew and cultivate a collapse in our economic system, only because republicans refused to compromise even the slightest on tax increases, their party will become permanently irrelevant, most likely disappearing from the grand ole stage of policy all together.
Written: 23 August, 2011
Posted on September 2, 2011, in Patriotslog Articles, Taxes and tagged Boehner, buffett, Congress, debt, deficit, democrats, finance, government, gridlock, mcconnell, Obama, politics, reform, republicans, revenue, taxes, warren, Washington. Bookmark the permalink. 6 Comments.