The Imminent Budget Deficit
by Rosanne Boardman
Santa Barbara, CA
What I don't understand is how Congressional moderates, Democrat and Republican, could be so blind. There
were plenty of experts who told them (and us) that the true cost of the Bush tax cut was more than twice that stated.* Now, experts in accounting predict a deficit as soon as the next fiscal
year (this October), and that the Republicans (who are pushing increased defense spending and an astonishingly
expensive National Missile Defense System) will have to, once again, take money from the Social Security Trust Fund
to pay for expenses, even before these costly defense programs are undertaken. (The article from the New York
Times, below, details all these facts.)
Of course, this is only a week after Treasury Secretary O'Neill stated that all the previous IOUs put into the Social Security Trust Fund during the Reagan/Bush Sr. years are not "real" debts......i.e., he plans to just kiss them off, cancel the supposed Treasury Bills held by Social Security. (Has anyone seen these T bills? How do we know they
really exist? Or are they actually yellow sticky notes that say, "Dear Baby Boomers, IOU, Ha, Ha! Yours, Ronnie").
O'Neill also recently said that everyone should be able to save enough for his/her retirement and all his/her/family medical bills merely through exercising virtue and discipline. So,
listen up, all of you/us living from paycheck to
paycheck: you/we are obviously dissolute and undisciplined, being unable
to set aside, oh, say, a mere $10 grand a year from your/our "disposable" income. (The hidden agenda here is that the more conservative element of the
Republican Party has always hated Social Security and Medicare, as they hated FDR, and would love to kill it and
return to the "good old days" of Robber Barons and Company Stores.)
The Social Security Trust Fund "surplus" was the result of an earlier Social Security Blue Ribbon Committee,
headed by former Sen. Daniel Patrick Monyihan, which, recognizing the crisis that will happen when the huge
population of the Baby Boomers reaches retirement, raised the Social Security withholding to prepare for this population boom of retirees. So all of us working folks had much larger
withholdings that went into the Fund, which were subsequently taken to pay for a huge tax cut given to the
rich under Ronald Reagan, and our retirement expectations were given an IOU.
Now it is about to happen again ! I'd call this reverse-Robin-Hood transfer true "Class Warfare" (the pink-tinged shibboleth the Republicans like to use when Democrats mention that maybe
the Income Tax rates should be progressive, since all other taxes are regressive). This shell game that transfers working folks wages to the super wealthy is really smooth, and once again, the Republicans with the green eyeshades snookered Congressional
moderates, as well as a lot of the public (but not a majority, since a majority never favored the Bush tax scheme).
I guess what I really don't understand, besides the naiveté of Congressional moderates, is why the many, many working people in this country are not really, really angry.
Oh, right. They listen to only network or Faux news and read the local newspaper, and never heard about any of this,
and don't want to be bothered anyhow. It might distract them from "Temptation Island."
* How the sly Republicans got a $3 trillion, plus, tax cut, advertised
as $1.35 trillion:
1. They conveniently forgot to account for the need to adjust the
Alternative Minimum Tax, which many middle
class taxpayers are now pushed into paying and which, if not adjusted,
will actually cause taxes to be raised for many
in the middle class......but then it is always possible that they planned to have taxes raised on the middle class, unchanged for the working poor (as is the case), and hugely lowered for
the most wealthy 1%. The current projected deficit almost guarantees that the Alternative Minimum Tax is unlikely to be adjusted for the middle class.......and.........
2. The $1.35 trillion figure assumes that a majority of the cuts
will be phased in, with most coming nearer the end of a 10-year period, and then all-of-a-sudden in year 11, all will cuts end and taxes will return to what they were at the beginning of 2001, including the estate tax, which will have been fully repealed for only one
year. (All the uber-rich had better plan on dying in 2010....or perhaps their heirs will see to it that they do !) But the laws of election politics would say that politicians in 2010 will have to continue the tax cuts or incur the ire of electorate. Assuming that politicians are not suicidal, then the cost of the tax cut actually more than douubles......Better add some new digits to the left-hand side of that National Debt
Clock in New York City, since the debt will be astronomic by then!
Here's the link to the New York Times article that prompted this letter: