A Tax Cut Testament

This article was published by the Copley News Service.

The tax cut passed by Congress "will not become law," promises President Bill Clinton, who was elected on a promise to provide a middle-class tax cut. Despite trillions in projected surpluses, he would prefer not give one penny back to the people who earned it.

The case for tax cuts could not be more clear. Almost from the moment thatRonald Reagan delivered a sweeping rate reduction in 1981, Democrats andRepublicans alike have been working overtime to increase government's take.

Senate Majority Leader Robert Dole made his career pushing tax hikes,President George Bush agreed to a high tax, big spending compromise withthe Democratic Congress, and Clinton mixed a gas tax hike with income taxrate increases in his first budget package.

As a result, Americans now face the highest peacetime tax collections ever,20.6 percent of GDP. The burden was heavier only once in 1944, when Americawas fighting in the greatest war in human history.

The constant plucking of the American goose has led to expected surplusesas far as the eye can see. It would seem only fair for the government tobegin returning some of their money.

Not in the eyes of Bill Clinton, however. He favors not those who earnmoney, but those who live off those who earn money.

It should come as no surprise, however, that a politician claiming torepresent the people is instead representing vested interests. After all,politics tends to attract people who desire to exercise coercive power forall the wrong reasons. Nobel Laureate F.A. Hayek appropriately titled onechapter of his The Road to Serfdom: "Why the Worst Get on Top."

Of course, the insight was not unique to him. The Jewish prophet, Jeremiah,warned that people are "skilled in doing evil." These are precisely thepeople most likely to gain control of government.

And, they will use their coercive power to tax to do evil. The author ofEcclesiastes declares: "If you see the poor oppressed in a district, andjustice and rights denied, do not be surprised at such things. ... Theincrease from the land is taken by all; the king himself profits from thefields" (5:8,9).

Indeed, when the Israelites clamored for a king, the prophet Samuel warned:

This is what the king who will reign over you will do:

...He will take the best of your fields and vineyards and olivegroves and give them to his attendants. He will take a tenth of your grainand ofyour vintage and give it to his officials and attendants. Yourmenservants and maidservants and the best of your cattle and donkeys he will takefor his own use. He will take a tenth of your flocks, and you yourselveswill become his slaves (8:11-17).

Thousands of years later, nothing has changed except that we now lose farmore than 10 percent. Democracy has become a fig leaf behind which interestgroups loot the larger public.

The president and his allies are masterful practitioners of the politics ofenvy. Shortly after taking office, he justified his tax hikes: "I will askthe economic elite who made more money and paid less in taxes to pay theirfair share." He continues to play the same game, recently calling the GOPproposal "so weighted toward special interest and upper-income people."

Yet, envy is far more destructive to the larger social order than greed,which the Clintons have routinely criticized. The greedy hurt themselves.The covetous harm other people which is probably why the Tenth Commandmentaddresses only the latter: "You shall not covet your neighbor's house. Youshall not covet ... anything that belongs to your neighbor" (Exodus 20:17).

The truly covetous are happy only if they are able to take from theirneighbor. The easiest way to do so, other than to use a gun to heistsomeone's wallet, is to use political power to tax. Community relationsbecome a negative sum game.

Of course, Clinton's opposition to tax cuts seems to be waning in the faceof the latest poll from Wirthlin Worldwide, which found that 59 percent ofAmericans thought he should sign the tax cut bill. White House NationalEconomic Council Director Gene Sperling has begun talking about thepossibility of compromise. Alas, he wants only a miserly $250 billion intax relief, none of which would go to those who pay the most in taxes.

The GOP tax cut is by no means perfect. It is, for example, far too small.But at least it is a beginning. With revenues and surpluses exploding, thepresident has no excuse not to approve a large tax reduction forallAmericans.