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Raising taxes just a bad idea
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Beginning in May, taxpayers will begin receiving checks from Uncle Sam of up to $600 per person. The checks are part of the stimulus package passed by Congress in February to boost the economy.
But wait. Last week, the Democratic majority led by the Progressive wing of the party (the new code word for ultraliberal), decided the economy doesn't need stimulating and middle-class Americans don't really need the money. A month after passing the stimulus package, the House — over my no vote — passed the biggest tax hike in U.S. history — a staggering $683 billion over the next five years.
The Democratic budget tax plan was not, as Democratic leaders keep saying, a rollback on tax cuts to the rich. The tax hikes they approved attack the budgets of lower- and middle-class Americans, including:
— Raising the 10 percent tax rate to 15 percent. The 10 percent bracket is paid by America's lowest wage earners. If the Senate approves the House tax package, more than 6 million individuals and families who now owe no taxes would be subject to a tax bill.
— Reimposing the marriage penalty. Eliminating the marriage penalty has never been popular with Democrats. A bill I co-sponsored in 2000 made it to President Clinton's desk, only to be vetoed. The marriage penalty was lessened with tax-reform legislation in 2001 and eliminated in 2003. The House even voted to make it permanent in 2003. But permanent is a relative word in Washington. If the Democrats succeed, 23 million married taxpayers will see their tax bills increase an average of $466.
— Per-child tax credit. The Democrats voted to cut it in half, meaning a tax hike of an average of $859 for 31 million taxpayers.
And that's only the beginning. Roughly 116 million taxpayers would see an average tax increase of $1,833; 84 million women would pay an average tax increase of $2,121; approximately 48 million married couples would incur average tax increases of more than $3,000; taxes would increase by an average of $2,323 for 43 million families with children; about 12 million single women with children would pay an extra $1,091; 18 million elderly individuals would pay an average of $2,181 more; and tax bills for 27 million small-business owners would rise an average of more than $4,000.
The average tax increase to California taxpayers — you and me — would be $3,331.
Make no mistake: This plan will hurt the economy. The current congressional leadership would do well to pay attention to the direction from a Democrat who understood economics. In 1962, President Kennedy told the Economic Club of New York: "In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low, and the soundest way to raise the revenues in the long run is to cut the rates now."
Lower tax rates equal higher tax revenues. That's because when taxpayers have money to spend, they do. And any economist will tell us that spending drives the American economy. That was the thinking behind the stimulus checks. As the economy grows, there is more wealth to tax. Hence, tax revenues increase on lower tax rates.
History has shown that cutting the capital gains rate always stimulates the economy. Those who have capital gains are, by definition, investors. The more money they have to invest, the more the economy expands.
Congress should make the tax cuts of 2001 and 2003 — which include the tax cuts to the poor, middle class, elderly, women, families and single mothers outlined above — permanent. The American economy works best when uncertainty is lessened. Making the cuts permanent — really permanent — would not only provide a real psychological boost, but, more importantly, it would help working families pay their mortgages and put food on the dinner table.
As JFK understood, lowering taxes is the best stimulus package Congress can pass. And raising them is an economic killer.
— Rep. Elton Gallegly, R-Ventura and Santa Barbara counties, represents the 24th Congressional District.
Posted by mikeb6804 on March 16, 2008 at 12:33 a.m. (Suggest removal)
JFK is the only Democrat who ever understood. Before they raise taxes, both parties need to cut wasteful spending (earmarks, some undeserved entitlements, etc).
Posted by harrypotter on March 16, 2008 at 11:42 a.m. (Suggest removal)
It's interesting to note that Mr. Gallegly said nothing about controlling federal spending. Over the last decade or so, the federal government, under mostly Republican leadership (of which Mr. Gallegly was a part) has spent money like drunken banshees. That needs to stop. Until federal spending gets under control and comes way down, taxes will have to go up. It's that simple.
Posted by mikeb6804 on March 16, 2008 at noon (Suggest removal)
Quite right you are, Harry. However, it takes more than Republican leadership to approve spending bills; fault lies on both sides of the aisle. The fact is we are represented by a bunch of crooks. And until the partisanship disappears, no constructive approaches to controlling spending or solving other problems stands much of a chance.
Posted by rjlebeck on March 16, 2008 at 3:44 p.m. (Suggest removal)
As Mark Twain once quipped: Figures lie, and liars figure. Mr. Gallegly tries both and falls short.
The economic stimulus package flies in the face of fiscal restraint, will not correct the structural deficiencies in the economy, and is being offered to placate voters in an election year.
Gallegly would never be in favor of such a give-away if a Democrat was in the White House. It only shows again what a tired politician he has become in his service to King George III (President Bush) and his corrupt court.
Gallegly's only motive is to preserve as many loopholes as possible for the rich and the well-connected. Don't be deceived by his rhetoric. His concern for the middle-class and the poor is false and hollow.
Posted by nannyfo1 on March 16, 2008 at 4:03 p.m. (Suggest removal)
We really do have a tax and spend government. The dems like to tax and the pubs like to spend. It probably would benefit us in the long run to get rid of them all and start over.
We are going to have to bite a rather large bullet to eliminate the debt we have accrued. Here is a start. Eliminate all ear marks. Make the tax cuts permanent. Stop ALL foreign aid until we are debt free. It makes no sense to give away money to one country when we owe another. We should take the foreign aid money and apply it to debt. We are not only going to have to get out of Iraq sooner rather than later, we have to get out of other places as well. How much does it cost us to protect South Korea's northern border? Why are we still in Germany? Phillipines? All of this costs billions of dollars.
Posted by retired_chief on March 16, 2008 at 5:20 p.m. (Suggest removal)
um...no permanent bases in the Philippines anymore. We left when everything was leveled by Pinatubo. Germany? Mid-point between here and the middle east, and a way to maintain presence in the old eastern bloc (especially now that the KGB re-treads have taken over Russia). Korea? Nothing. The RoK pays for our bases there (same as Japan).
Posted by Jurnei on March 21, 2008 at 6:15 p.m. (Suggest removal)
Is this the same Elton Gallegly that votes for everything George Bush wants? I'm amazed and totally without confidence. First of all, I can almost hear the salivating in mention of "progressives". Wouldn't it be most appropriate to get away from the nonsense of speaking badly about the Democratic party just to take the opportunity? The current administration, and our local Representative Gallegly himself, has certainly gotten this nation and economy in a mess with the Iraq war, spending on the Iraq war, bigger than ever government, and ongoing party games.
Why don't we first focus on impeachment of George Bush and Dick Cheney for their dishonesty that led to an illegal war? Wasn't it Gallegly's post in the Ventura Star many years ago that stated how concerned he was over dishonesty from Bill Clinton? Where is that disgust with Administrative dishonesty now?
Why does Mr. Gallegly speak out only to address the Democrats as "Progressives" or "Ultraliberals", while he blindly supports an Administration that has caused such crisis' in this nation.
Sorry, but I just don't see what Gallegly does for this district or the country in general. Certainly I don't want to hear what he has to say about the Democrats, "Progressives", "Ultraliberals". This just sounds more like George Bush's terrorist rhetoric to me and most childish at this point in time. Let's hear something more intelligent and focused on our issues for once rather than more fear-drum beating of terror and taxes. This is getting very old. The current Administration continues to destroy this nation and all of their blind supporters need to go.
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