Monday, September 19, 2005

Some Figures to Ponder

The current U.S. National Debt: just under $8,000,000,000,000 (eight trillion dollars).

The per-citizen portion of this debt: $26,665.00. (Family of four? You owe $106,660.)

The estimated U.S. budget deficit (the amount to which we are adding to the national debt) for 2004: 412 billion dollars.

The per-citizen portion of this year’s deficit: $1387.


Nobody likes to pay taxes. I think the closest we get is a desire for the services which require tax dollars to provide. That’s not very close, but when we see government doing things we need or universally approve of--highway maintenance, say, or disaster relief--I think we feel less cranky about shelling out a portion of our earned income or putting in an extra dime for every dollar we spend at the grocery store, to contribute to these things.

Still, it’s a long-standing axiom that any candidate for political office signs their own death warrant if they advocate raising taxes; conversely, any candidate who sells a tax cut on the stump has a leg up. This is a failing of our political and educational systems, in my opinion, and it’s only made worse by our sound-bite-driven media climate. Nobody grasps the big picture.

It has been a criticism, or maybe just an observation, depending on your politics, that our current president, and the particular constituency he speaks for, intends nothing less with his tax policy than the dismantling of the present welfare state,to include that safety net for bad financial planners, Social Security. I certainly can’t see into the mind of anyone, but this speculation about W’s motives is not a ludicrous stretch when one looks at what has become of our country’s finances. These above figures are positively alarming.

The decision to pursue a war against a country nearly half a world away, whether we deem it a worthy endeavor or not, is an extremely serious drain on our country’s financial health: the bill for that undertaking is currently approaching a quarter of a trillion dollars, far in excess of original projections, and with the end of the expenditures nowhere near in sight.

Again, that may or may not be totally justified. But in light of these questions, the decision to go ahead with a massive tax cut concurrently with the pursuit of war should raise eyebrows, if not riots in the streets.

When W took office, he inherited from Bill Clinton a record budgetary surplus of 230 billion dollars. (During Clinton’s last three years in office, the national debt had shrunk by 360 billion dollars, to 5.7 trillion, and projections were that another trillion dollars of debt would have been retired in the ensuing decade.) Halfway thru his first term, with the war and tax cuts an intrenched reality, this record surplus had become a deficit of $158 billion; for 2003, a record deficit of $304 billion; 2004’s deficit is projected at over $400 billion, and Bush’s own 2005 budget calls for an astounding $512 billion dollar deficit.

This is something that needs serious contemplating.

My struggle is to try and connect the dots of what we all can clearly see with the claims made by our government on behalf of these policies enacted. (There are so many claims and tactics of which I’m skeptical, like the fantastic and spin-heavy names for initiatives: “Patriot Act,” “Clear Skies Initiative,” the “Healthy Forests Initiative;” I am profoundly skeptical of any administration claim at this point. But back to taxes.)

The administration sold the tax cut with the claim that it would bring greater relief to lower income groups than upper ones. And I have heard a lot of people angrily defend this claim. But an honest look at the details derails it as more cynical spin; the lopsidedness of the distribution of the tax cut is now a matter of record, with projections of W's plan giving the top 1% of incomes a whopping 52% of the tax cut! The average middle-class taxpayer saves a couple hundred bucks, if anything.

OK, this is all old news (though I think it bears repeating). But comes Katrina and we’re facing a world of shit financially. The estimated costs to our government for recovery of the hurricane are upwards of $200 billion. This matches the costs to date of the war in Iraq, and is another $700 of debt for every citizen of this country (since we’re bleeding from every vein before this expenditure).

And how does this government propose we pay for this? W insists that an increase in tax revenue, and specifically the rescinding of the tax cuts, is out of the question. The sacrifice, he says, is to be in the form of spending reductions.

I earnestly fear what spending reductions he comes up with.

1 comment:

matty said...

Here, here. great post.