June 18, 2008


Read My Lips: We Need These Taxes (Roger Lowenstein, June 15, 2008, Washington Post)

Let's imagine an alternate universe. The U.S. government is running a large and growing deficit. Not far down the road it faces huge increases in Social Security and Medicare costs. Naturally, the candidates for president want to remedy this by raising revenue. They don't want us to bequeath bigger deficits to our children or stake our future on foreigners' willingness to keep lending us money.

But have you heard this speech? "My fellow Americans, I have a plan to raise taxes so that the budget will be closer to balance and future Americans won't have to worry about their retirement security." Neither have I.

Somebody, though, should be giving it.

...but it was hardly an alternate reality. And those old enough will recall that he ran on this message 25 years ago, when larger deficits were unsustainable.

Posted by Orrin Judd at June 18, 2008 8:36 PM

And how many states did he win in the election? ; )

Posted by: Bartman at June 19, 2008 8:05 AM

The best strategy here is to engage in a series of "tax swaps" that are actually tax cuts. Raise gas taxes as prices drop, while cutting the workers portion of Soc. Sec.

State wise, cut property taxes, enact spending caps, and increase various sales taxes. As long as they result in cuts, the good guys win.

Posted by: Bruno at June 19, 2008 11:01 AM

The alternate part of Loewenstein's universe is that raising Federal taxes raises Federal revenues. Because it doesn't in this universe.

Since WWII, Federal receipts have been 19.5% of GDP plus or minus a couple random percentage points. Period. The only way to increase revenues is to grow GDP. Period.

So why does Loewenstein want to hear a proposal that can't work? Well, I guess that depends on how the definition of "work" works.

Posted by: Bob Hawkins at June 19, 2008 11:10 AM
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