HOW LOW IS ENOUGH?
Kevin Drum argues that we have cut taxes and spending to the bone to the point where we can’t afford a decent society:
So given the fact that over the past 30 years we’ve been steadily cutting taxes on the rich, cutting federal spending, cutting welfare programs, and cutting Social Security, let’s ask the question again: How low is low enough? How much cutting of these programs will satisfy you?
I totally reject this premise.
Federal spending is skyrocketing, we seem to be adding new programs all the time, and Social Security is easily the biggest chunk of the federal budget. When have we cut any of that?
Kevin bases his argument on comparing overall spending to GDP and by noting that we are steadily moving the SS retirement age from 65 to 67. The problem with that is that, as our GDP has increased, so has our real level of prosperity. Our GDP has far outpaced inflation and by almost any measure you want to choose, our standard of living is geometrically improved over the last half century. And, compared to our expected mortality rate, 67 is much younger now than 65 was in 1932 when SS was created.
And, yes, marginal rates on the rich (a class I am unlikely to join, btw)have decreased since the JFK cuts, the actual percentage of taxes paid by the rich continues to escalate. The data on this are constantly cited, but here’s one from ABC News/AP data:
The wealthiest 5 percent pay more than half the taxes, while people in the bottom half pay just 4 percent.
Two-income households are increasing, putting more families in the top slice of taxpayers. Millions of small businesses and partnerships are up there, too, paying personal instead of corporate income taxes. Many other people were boosted by the 1990s stock market boom.
President Bush’s big tax cut will prevent the wealthy from paying an even greater share in coming years. But key provisions, such as the gradual doubling of the child tax credit, will reduce or eliminate income taxes for many middle-income people while the rich won’t qualify.
“This trend is not going to reverse,” said Scott Hodge, executive director of the Tax Foundation, a nonpartisan tax education and research group. “This will be the demographic for the 21st century taxpayer.”
So, contrary to the liberal myth, the rich are certainly paying their fair share.
In the same post, however, Kevin makes an argument I tend to agree with:
As conservatives themselves point out tirelessly, the poor in America do have access to healthcare, but because of the crazy quilt nature of our public/private/emergency room system, the cost of this care is far higher than it should be. In fact, the best argument for a national health plan Ã¢€” aside from its eventual inevitability for technical reasons Ã¢€” is that it would probably lower the amount we spend on healthcare, not increase it. A national healthcare plan is a bid for more efficiency, not for more government giveaways.
Kevin is almost certainly right on the benefits and inevitability of a centralized health care system. I do worry about loss of incentive to innovate as well as the inevitability of government-imposed rationing. Granted, right now the rationing already exists for some on an economic basis, but the threats to individual liberty are quite different.
We are already creeping toward socialized medicine, with the poor, the old, some veterans, and all military personnel (off the top of my head) participating. My guess is the gaps will be filled in the next twenty years or so.