On taxes

Yesterday, the President told Kansas: "if you vote Democrat, you're voting for a tax increase."

In fact, the exact opposite is true. Were this a Woody Allen movie, I'd pull Marshall McLuhan Milton Friedman from behind a movie poster to explain for me. It is not, so I'll pull out Max Sawicky:

There are no tax cuts. Banish that phrase from your mind. You haven't seen any.

Republican control of the White House and Congress has yielded trillions in tax increases since January of 2001. How can this be? Simple. When you spend more, and when you pass laws that commit the government to spending more in the future, you increase taxes, sooner or later. Spending not financed by current taxes will be financed by future taxes. A debt increase is the present value of future increased taxes. If taxpayers merely pay interest on the debt incurred, forever, the present value of the interest payments is the initial increase in debt.

Suppose you raise future spending on X but later you cut spending on Y? You have still raised taxes. If you had cut spending on Y and foregone the spending on X, taxes would be lower. To spend is to tax. There are no tax cuts. There are only tax shifts.

And Brad Delong:

In no meaningful sense has George W. Bush reduced the tax burden. In no meaningful sense has he kept any promise. George W. Bush has kept his promise to cut taxes in the same way that a spouse who decides to "save money" by making only the minimum required payment on the VISA bill has kept a promise to reduce household spending.

As Milton Friedman puts it, to spend is to tax. Bush's spending increases--defense, Iraq, the Republican porkfest, the Medicare drug benefit--are still there, just as things you have charged to your VISA don't go away if you make only the minimum monthly payment.

What George W. Bush has done has been to shift taxes from the present to the future--and also made future taxes uncertain, random, and thus extra-costly from a standard public finance view.

Rep. Moore likes to talk about the debt tax, the cost of interest on our debt that just gets rolled into the cost that future generations will have to pay because George Bush lacked the political courage to say "no" to a single expense, nor to a single revenue cut. He, like his lackeys in Congress, have no interest in actually reducing the tax burden on America; if they did, they would cut spending to match cuts in taxes.

This is not complicated math. 2+2 will never come out to 3, no matter how many supply-side fundamentalists you can get to say otherwise.

Representative Ryun sits on the Budget committee. He could have worked to cut the deficit, but instead he chose to let the President's requests for money sail through without any plan for paying those debts.

Maybe your 1.5 kids got $750 more in child tax credits. But those kids will owe a lot more on the debts that we've run up with China. A vote for a Republican is a vote for irresponsible spending and an impoverished future.