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Jewish World Review Aug. 13, 1999 /1 Elul, 5759

Linda Chavez

Linda Chavez
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Econophone

Dems as Robin Hood?

http://www.jewishworldreview.com -- MIDDLE AMERICA, hold on to your wallets, the Democrats are about to engage in class warfare again.

What's got the Democrats donning their Robin Hood costumes? Why, the Republican proposal that all working Americans ought to be able to keep a little bit more of their hard-earned incomes and pass on to their children and grandchildren the accumulated savings of a lifetime.

As usual, the Democrats are using their favorite ploy to convince Americans to turn over their money: Scare the old folks into believing that the Republicans want to slash their benefits, and make everyone else believe that programs for the elderly won't be there when they need them.

The Democrats' tactics are as unscrupulous as they are predictable. Instead of explaining why they oppose returning to the American people $792 billion in excess taxes the government expects to collect over the next 10 years, Democrats are intent on changing the subject.

Democratic National Committee chairman Gov. Roy Romer set the tone last week. "Everyone from families around their kitchen tables to top economists are worried about the challenges facing Medicare -- everyone that is, except the Republicans, who voted for this risky task (sic) scheme," warned Romer on the DNC's Internet web site. But the Democrats' facts are as bad as their spelling.

Neither Medicare nor Social Security are the issue. The Social Security system currently collects more taxes than it dispenses in benefits, creating a temporary surplus. Republicans have introduced legislation to protect 100 percent of this surplus as insurance toward future Social Security claims when the baby boomers hit retirement, although Senate Democrats have so far blocked its passage. As for Medicare, it's the Democrats who have balked at genuine Medicare reform, opting instead to promote costly new programs. Overall, the Democrats have proposed almost $1 trillion in new spending, and want to create more than 80 new federal programs.

The Republican plan doesn't go nearly far enough to reduce tax rates -- the bill cuts rates by a mere 1 percent over the next decade -- but it does include other important changes that will eliminate some of the gross inequities in the current system. Legislation passed last week includes an increase in the standard deduction for married couples, so that the federal government stops penalizing marriage, as it does now, by allowing a larger deduction for two single adults who live together than it does for husbands and wives.

The bill also eliminates the current death tax, which penalizes family members who inherit the fruits of their parents' and grandparents' hard work. The current system taxes every person's earnings and capital gains during his or her lifetime, then, taxes it again when the person dies and passes on his or her property if it exceeds $650,000 (although the amount not subject to taxes will rise gradually over the next nine years under current law).

The original purpose of the inheritance tax was pure socialist engineering to prevent a permanent class of wealthy individuals from developing in the United States. But its effect has been to deprive thrifty families whose retirement funds have gone up with the booming stock market from passing on their own money to their heirs. This policy has wreaked havoc on family businesses and farms, forcing some families to sell off their inherited property just to pay the taxes.

Despite their more moderate image in recent years, Democrats still like to play the class-warfare card. They want to penalize "the rich" with higher taxes and redistribute wealth as they see fit through government programs. But threats of soaking the rich have never worked particularly well in the United States, where almost everyone hopes to make enough money someday to be counted among the wealthy. That hope has driven Americans to work longer and harder and to take chances that others would never risk. It has spurred creativity and entrepreneurship that makes American business the envy of the world. So, why do the Democrats want to discourage such efforts?

The middle class won't benefit by depriving the rich of more of their money. The Democrats have got their Sherwood Forest legend backward. They're not stealing from the few to give to the many, but taking from everyone to feed government. Maybe Democrats should adopt the Sheriff of Nottingham, not Robin Hood, as their true idol.


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