Tax cut doublespeak

We will never really know whether the tax cut now working its way through the legislative process ever delivers as promised. But I would feel a great deal better about its prospects for success if the reasoning being used by supporters was even slightly consistent with what they have said in the past.

Even if another round of reductions doesn't produce the increase in economic growth and jobs the White House is claiming, so many intervening things will have occurred by the time that's realized that it will be impossible to say definitively that this tax cut failed. The breakdown will be attributed to - take your pick - inappropriate decisions by the Federal Reserve, continued consumer and business shock from Sept. 11, severe acute respiratory syndrome, corporate fraud, weakness in financial markets, Bill Clinton, or any one of an unlimited number of other possibilities.

But tax-cut proponents have incontrovertibly weakened their case by what can only be considered an extraordinary willingness to abandon most of their past arguments to justify what they are proposing to do today. This makes it far more likely that the tax cut is based on something other than its value to the economy.

Start with what used to be the Republican mantra of reducing the deficit. A cornerstone argument used by Republicans to win a majority of the House of Representatives in 1994, this issue has now been completely abandoned. If Newt Gingrich had been successful in implementing the Contract with America's budget components, none of what the Bush administration or the Republican-controlled Congress are now trying to do would even be legal.

More recently, a tax cut was said to be necessary in 2001 because there was a huge budget surplus that needed to be reduced. This year, however, it supposedly is being proposed because there is a deficit that needs to be reduced. If the first was true two years ago, the second can't be true now. Alternatively, if this year's tax cut is really needed, then the 2001 tax cut was a mistake that may have caused at least some of today's economic problems.

Another current example of this doublespeak is the now-standard position tax-cut advocates have taken in the past few years: Only permanent tax cuts will convince consumers and business to change their behavior and, therefore, grow the economy.

But these very same politicians have been more than willing to abandon this position in recent weeks when a temporary tax cut appeared to be the only way to get what they wanted. When faced with the need to fit their preferred policy change into the Senate's $350 billion limit, these absolutely-has-to-be-a-permanent-change disciples suddenly decided a cut that is phased in and out is perfectly acceptable.

As was the case with the surplus/deficit issue, these two positions on permanence are utterly contradictory: A tax cut either has to be permanent to provide a boost to the economy, or it doesn't. If it does, then why are this year's tax-cutters so willing to abandon the principle? If it doesn't, why were tax-cut supporters so critical of alternative proposals that would have cut taxes by more but only for a year or two?

Finally, there is the willingness of tax-cut supporters to speak in almost reverential tones about the value of their proposal as it is being enacted, but then to insist a year later that it be changed. For example, the 2001 tax cut was phased in over a period of years because the White House and others at the time insisted that was the best way for tax policy to be altered. Barely a year later, however, that same White House is insisting that the changes be accelerated so that the original plan can work faster and better.

The logical question is, if the accelerated plan will be better for the economy, why didn't its supporters make a case for it in the first place?

The bottom line, of course, is that the substance of the tax cuts is really beside the point. The goal is to cut taxes because of the perceived political benefit of doing so. Whatever rationale needs to be used, even if it is diametrically different from all previous positions is acceptable under these circumstances.

That should make us all question whether, except by dumb luck, the promised economic benefits from the tax cut are even possible, let alone likely.

Question Of The Week

Last Week's Question. Contrary to what several readers said, the Gephardt Rule does not encourage someone to repeatedly run for president. It allows the House to approve an increase in the federal debt ceiling - automatically and without a separate vote - when it approves the conference report on the budget resolution for the coming year. The Senate does not have a similar procedure and must vote on a stand-alone bill. The winner of the incredibly beautiful and soon to be a collector's item "I Won A 2003 Budget Battle" mouse pad is Stan Rosenblatt, a park ranger with the Army Corps of Engineers in Dover, Ohio. Stan was selected at random from all those who responded with the correct answer.

This Week's Question. Appropriation season is upon us, so it is only appropriate that we have a related question. The question: What is the difference between advance funding and advance appropriation? Send your response to scollender@nationaljournal.com by 5 p.m. PDT on Saturday, May 17, 2003. You must include your mailing address so the "I Won A 2003 Budget Battle" mouse pad can be sent if you win. If there is more than one correct response, the winner will be selected at random from those with similar answers.

(Note to government employees: Because of security procedures at most departments and agencies, a home rather than office address will be the best way to get the mouse pad to you.)

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Tax cut doublespeak
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