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Jewish World Review Jan. 29, 2002 / 16 Shevat, 5762

Doug Bandow

Doug Bandow
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Consumer Reports

Democrats for what? -- WITH Congress back in session, economics is likely to come to the fore. President Bush may be winning the war on terrorism, but congressional Democrats think they can recoup by blaming him for losing the surplus. This party of big spenders is ill-equipped to take political advantage, however.

Senate Majority Leader Sen. Tom Daschle (D-S.D.) recently went on the attack against the Bush tax program. But Daschle's charge that administration policies "probably made the recession worse" is partisan cant.

The Bush tax program hadn't even gone into effect when the economy began slowing. Moreover, virtually no economist believes in fighting recessions with tax hikes. Twelve Democratic senators and 28 Democratic congressmen backed the Bush plan.

Nor can the disappearing surplus be blamed on the tax cut.

That measure will reduce revenue by only $43 billion this year, says the House Budget Committee, compared to the once estimated $3

13 billion surplus. The rest was due to the slowing economy and anti-terrorism legislation. Yet after conjuring up so much alleged harm from last year's modest rebates, Sen. Daschle is unwilling to forthrightly advocate a tax hike. At least Sens. Hillary Clinton (D-N.Y.) and Ted Kennedy (D-Mass.) have the courage of their convictions and are calling for an increase.

Instead, Sen. Daschle, the Democratic Party's nominal national leader, advocates new tax breaks, but oriented to the sort of social engineering at which Democrats excel. Yet there's no need for tax credits and government loans to promote universal broadband service, as he proposes, when 85 percent of Americans already have access if they choose.

This special interest boondoggle would never end. Decades after virtually every American has electricity and telephone service, the Rural Utility Service (successor agency to the Rural Electrification Administration) continues, subsidizing such needy areas as Snowmass and Hilton Head Island.

Daschle's lack of seriousness is even more evident in his refusal to go along with the president's plan to hold so-called discretionary spending to a 4-percent increase a year. Even excluding the $55 billion in post-Sept. 11 emergency spending approved for 2001 and 2002, budget analyst Steve Moore figures that Congress doubled the president's proposal. Discretionary domestic outlays rose an astounding 11 percent last year.

Of course, Republicans as well as Democrats like pork. It is Democrats, however, who relentlessly push to increase spending on virtually every program, Indeed, when Congress debated the misnamed economic "stimulus package" last fall, Sen. Daschle blocked its passage for being insufficiently wastrel. He wanted to pay off Democratic interests, not protect the public purse.

There are few agricultural products which he would not subsidize: what would America do without bison ranches, for instance? Without shame, he railed against proposed corporate tax reductions, while successfully pushing to offload a South Dakota mining concern's environmental liability -- estimated to run as much as $1 billion -- onto Uncle Sam.

Indeed, there appears to be nothing upon which Congress will not spend money. The Justice Department's appropriation includes $50,000 to pay to remove tattoos from residents of San Luis Obispo, Calif. This one can't be blamed on Sen. Daschle -- it came from Rep. Lois Capps (D-Calif.). Even if tattoo removal is a good means to help former gang members, why should the money come from Washington and not California or San Luis Obispo or private aid agencies?

The best economic stimulus would be to accelerate the Bush rate cuts that were delayed, largely at Daschle's insistence, for three and more years. And to make them permanent.

Rebates have no impact on future behavior. It is rate cuts that encourage people to invest instead of consume and work harder instead of play longer.

Moreover, the Bush tax cuts are scheduled to run for a decade and then disappear. This does not allow people to plan for the future, invest and take risks.

The way to "pay for" more tax relief is to simply slow federal spending. It could, and should, be cut substantially.

Slash corporate welfare. Kill the endless subsidy soup line for every known interest group. Take on entitlements. Shift the burden of defending Asian and European allies onto the Asian and European allies. Tell Americans that the government exists to fulfill essential collective functions, not enrich whomever has good access to an influential congressman.

But simply slowing growth would help. The National Taxpayers Union figures that, had Congress held annual federal spending increases to 3 percent over the last decade, outlays would have been $144 billion lower in 2001. Just limit Uncle Sam to cost-of-living increases and surpluses would miraculously re-emerge.

The major political parties rarely stand for much. But Sen. Daschle has enlightened people about the Democrats' agenda for the United States: taxpayer beware. Americans can do better.

JWR contributor Doug Bandow is a senior fellow at the Cato Institute. Comment by clicking here.


01/22/02: The Iraqi question
01/14/02: Profiling frequent flyers
01/08/02: Trade, not aid
01/02/02: Treason by any other name
12/26/01: Preserving freedom in an unfree world
12/17/01: Dealing with terrorism's aftermath
12/10/01: Emerging friendships?
12/04/01: Uncle Sam: Insurer of last resort
11/28/01: Expanding the circle of trade
11/20/01: Free to be stupid
11/13/01: The meaning of compassion
11/07/01: Patriotic scoundrels
10/30/01: The coming postal raid
10/16/01: First, do no harm
10/12/01: Good news from a suffering land
10/04/01: Defending whom?
09/25/01: The wrong solution to the wrong problem
09/21/01: The price of terrorism
08/28/01: Uncle Sam's retirement scam
08/21/01: Canberra's quaint naivete
08/14/01: Uncle Sam's false fuel economy
08/08/01: The Clinton administration in drag
07/31/01: The high cost of government
07/24/01: Kill the campaign reform illusion
07/17/01: Do as I say, not as I do
07/11/01: Lawyers at play
07/05/01: Western blundering, Macedonian disaster
06/26/01: How best to honor Bill Clinton?
06/19/01: A maturing Europe?
06/15/01: Tell Beijing to mind its own business
06/06/01: Ukraine's boiling cauldron
05/31/01: Protecting privacy from Uncle Sam
05/22/01: America's Balkan quagmire
05/09/01: The Taiwanese flash point
05/01/01: Globalization serves the world's poor
04/24/01: Who's cheating whom?
04/10/01: The NCAA scam
04/03/01: Balkan stupidities
03/27/01: McCain doesn't want a 'risk for our country'
03/20/01: Dubious Korean alliances
03/06/01: Coercive patriotism
02/27/01: Bombing without end
02/20/01: A dose of misplaced outrage
02/13/01: Psst: Tax cuts for taxpayers. Pass-it-on
02/06/01: Bridging the unbridgeable gap
01/23/01: Left-wing demagoguery
01/16/01: The drug war problem
01/10/01: Politics and trade
01/03/01: Hope for liberty?
12/27/00: The debris of war
12/19/00: What's the rule of law for?
12/15/00: Ending silicone breast implant saga
12/05/00: Election may yield victor, but there are no winners
11/21/00: A Bush presidential mandate?
11/07/00: Exprienced Gore? Yeah, right
11/01/00: Interventionist follies
10/17/00: America's brightening prospects in Ukraine
10/11/00: GOP budget scandals
10/03/00: How a pharmaceutical 'crisis' was created
09/27/00: Clinton's empathy has helped nobody
09/13/00: AlGore's risky budget policies
09/05/00: Military readiness and Korean commitments
08/29/00: Let sleeping hypocrites lie
08/21/00: Targeting a journalistic pariah
08/15/00: European garrison for Kosovo?
08/08/00: Journalistic cleansing at the Boston Globe
08/04/00: Junk science on trial
06/22/00: Eternal vigilance is the price of liberty
06/15/00: The end of U.N. peacekeeping
06/07/00: The Clinton regulatory miasma
06/01/00: Administration stupidity, congressional cowardice
05/25/00: The silence of the international community
05/18/00: Protecting the next generation

05/11/00: Freer trade with China will advance human rights

05/04/00: How not to save the Constitution

04/28/00: American tripwire in Korea long ago disappeared: Why are we still involved?

04/18/00: Clinton administration believes the IRS is too gentle, wants more auditors

© 2002, Copley News Service