Moscow-Pullman Daily News October 15-16, 2005
By Judith L. Brown
I have hemmed and hawed about writing a column on the aftermath of hurricanes Katrina and Rita, and how best to provide relief to the victims and rebuild from the destruction. However, as I sat down on Wednesday to write this week’s column, the day’s headlines were so galling that I decided to address this issue right now. It couldn’t wait any longer.
“Idaho congressmen eye spending cuts to pay for hurricanes” read the day’s papers. Sen. Larry Craig and Rep. Mike Simpson both have positions on key appropriations committees. In sync with the Republican mind-set that favors new tax cuts each and every year regardless of spending needs, they said that almost every federal program would be on the chopping block in order to find the money needed for hurricane relief and rebuilding.
Craig commented, “We have a deficit that we are struggling to control and all of a sudden we are hit with one of the worst natural disasters in history.”
Simpson noted, “We are going to have to go after entitlement programs, we’ve got to go in and really reform programs like Social Security and crop payment programs and try to find some savings.” Other so-called entitlement programs include Medicare and food stamps.
We do have a massive recovery effort that should be underwritten with federal tax dollars.
And we do have deficits as far as the eye can see, the consequence of expensive ongoing wars and years of reckless, irresponsible tax cuts for the rich and for corporations.
That’s where the logic of the Craig-Simpson comments ends.
We should not permanently reduce Social Security payments to retirees now and into the future in order to provide temporary disaster relief to hurricane victims.
We should not permanently degrade health care for seniors during a time of rapidly rising medical costs and an aging population.
We should not take food stamps away from hungry people in Idaho, Washington and elsewhere around the nation in order to provide emergency assistance to hurricane victims in the South.
How should we fund hurricane relief? The solution is obvious: we need a temporary tax increase. It is entirely appropriate, and in the current situation fiscally responsible, to use a temporary tax increase to cover unexpected but necessary one-time expenses.
There’s a swift, simple and efficient mechanism for raising emergency relief funds in a fair way: enact an income tax surcharge on the nation’s highest-income families-households with incomes more than $200,000 or so.
An income tax surcharge generates revenue quickly. It could begin bringing in revenue this year. It would enable spending on disaster relief to be balanced with revenues for disaster relief, this year and each year the surcharge remained in effect.
Perhaps more importantly, an income tax surcharge on high-income families would be the fairest way to increase taxes. High-income families have benefited most from the economic expansions of the last 25 years. They also have benefited most from the federal income tax cuts enacted since 2000. Levying a surcharge on high-income taxpayers would result in a tax increase only on those taxpayers best able to afford it.
Why does the Republican mind-set refuse to consider a fiscally responsible tax increase?
Time and again, Congress has found it not to be politically feasible to cut Social Security, Medicare and food stamps. Why? Because these are programs the public values and supports.
And so the neoconservatives, who like to criticize liberals as the “tax and spend” folk, and who present themselves as the “cut here in order to spend there” folk, are in reality just the “borrow and spend” folk.
The borrow and spend approach was first perfected by David Stockman, director of the Office of Management and Budget during the first Reagan administration. It lead the nation to fiscal ruin then and it is leading the nation to fiscal ruin now.
The latest NBC News/Wall Street Journal poll finds that just 28 percent say the country is headed in the right direction, an all-time low for the Bush presidency. You’d think they’d begin to get the message that the public wants more integrity and more responsibility from its leaders.
Do the responsible thing: provide disaster relief and pay for it in a fair way. Enact an income tax surcharge on the nation’s highest-income households.
* Judith L. Brown is an economist and the director of the Idaho Center on Budget and Tax Policy. She lives in Moscow with her family and can be reached at jlbrown@turbonet.com.