Home
In this issue
April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review Oct. 11, 2012 / 25 Tishrei, 5773

How Much Is This Tax Cut Gonna Cost Me, Doc?

By A. Barton Hinkle




http://www.JewishWorldReview.com | You walk into a shoe store. The salesman runs up to you. "Great news!" he beams. "We've just slashed our prices 20 percent!"

"Yikes!" you say. "I can't afford a price cut like that! I'm outta here."

"No, no — maybe you didn't hear me," the clerk says. "We're cutting our prices 20 percent. Cutting, not raising."

"I heard you just fine," you say. "I'm not paying an outrageous increase like that!" And you storm out the door.

The preceding scenario makes no sense — except in the bizarro world of government finance. For that is precisely how many people speak, when they speak of taxes.

Take The Washington Post, which tore into Paul Ryan the other day for dancing around a question about tax cuts.

"Paul Ryan wants to tell you about the wonders of the 20 percent cut in tax rates that he and running mate Mitt Romney propose," the paper intoned. "He doesn't want to tell you how much it will cost." The paper went on to praise Chris Wallace of Fox News for repeatedly asking Ryan "this basic question" and "citing projections of a 10-year cost of $5 trillion."

The Post is not alone. The New York Times likes referring to the "cost of the Bush tax cuts," for instance. So do liberal organs such as ThinkProgress, the American Prospect, and The Nation. Not long ago, the Annenberg Center's FactCheck.org said Romney's tax-cut proposals "would cost $480 billion a year" (that's the answer the Post wanted Ryan to cough up). In his State of the Union address, President Obama said the U.S. was "poised to spend nearly $1 trillion more on what was supposed to be a temporary tax break." After Wednesday night's presidential debate, analysts on NPR discussed how Romney planned to "pay for" his tax cuts. Inside the Beltway, wonks even talk of "tax expenditures" — by which they mean exemptions, loopholes, and similar devices that lower a taxpayer's total bill.

Now, from a government accountant's perspective, there is little difference to the Treasury between spending $14 billion on a Ford-class aircraft carrier and reducing revenue $14 billion by lowering taxes. If the federal government is running a deficit, then the deficit goes up by $14 billion no matter which route you take. Likewise, a 20 percent price cut on shoes will impose a cost — not on the customers, but on the store or the shoe company.

But, funny thing. A few days ago The Tax Policy Center released a study looking at what would happen if the U.S. goes over the "fiscal cliff," the point at which automatic spending cuts occur and the Bush (and other) tax cuts expire. And look how it was covered:

"Expiration of Tax Cuts Would Be Costly to Taxpayers," wrote The Boston Globe. "The Fiscal Cliff Will Cost a Median-Income Family $2,000," said The Atlantic. "What will falling off the 'fiscal cliff' cost your household?" asked CNBC.

And The Huffington Post, which in August ran this headline — "Bush-Era Tax Cuts Will Cost U.S. Nearly $1 Trillion Over Next Decade" — last week said the expiration of those tax cuts would "Cost (a) Typical Middle-Class Family $2,000."

The upshot of all this is that the Bush tax cuts have "cost" billions of dollars — and the failure to extend them will cost billions more. You could chalk this up to Glass-Half-Empty Syndrome: No matter what happens, we're all hosed. But the real explanation is not as bad as that. It's worse.

The real explanation is that those who fret about the cost of a tax cut are looking at the question from the wrong end of the telescope. They identify with the tax collector, not the taxpayer. Like the accountant for a shoe company, they're not thinking about how much money you stand to save — but how much they stand to lose.

You might think of a tax break as allowing you to keep more of your own money. That's not how Beltway types see it. When they talk of "tax expenditures," they are operating on the assumption that all wealth belongs to the government first. When the president says the country is "spending" money on tax breaks, he speaks as if the dollar in your pocket got there not through your hard work - but through his generosity.

Well, one could say, in a democracy everyone has a say in our government, so we are all in some sense the owners of the shoe company. So cutting taxes really does "cost" us in that sense. You keep telling yourself that, Vladimir Ilyitch. Most people who go into a shoe store think about the price on the tag, not the Nike stock in their 401(k).

So perhaps Ryan should have said something like this: "Tax cuts don't cost money — they save money. Government spending is what costs money. If you think cutting taxes costs money, then you must think raising taxes saves money. By that logic, a 100 percent tax rate would mean Washington isn't spending anything at all. And that, my friend, is absurd."

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

A. Barton Hinkle is Deputy Editor of the Editorial Pages at Richmond Times-Dispatch Comment by clicking here.


Previously:




10/04/12: Warrantless spying skyrockets under Obama
08/20/12: The wrong side absolutely must not win
08/14/12: America was not built on dirt alone
08/02/12: Libs Discover Their Inner Cheney
07/30/12: Feds want to help you --- whether you want help or not
07/23/12: Barack Obama, Storyteller-in-Chief
07/23/12: Nation's worst outsourcer? You
07/19/12: Listen up, America: You need to knuckle under
07/12/12: Obama, Romney: As Different as Two Peas in a Pod
07/05/12: Are teenagers big children --- or little adults?
06/25/12: Minorities treated as mere numbers
06/21/12: Memo to the the Little Guy: Seemingly innocuous activity could bring the federal hammer down out of a clear blue sky
06/19/12: We mustn't let America be buffaloed
05/31/12: Drop and Give Uncle Sam 20
05/15/12: The feds would like to know if you enjoyed that video
05/03/12: Obama inspires: 'America --- Still Not as Bad Off as Venezuela!'
04/26/12: It's everyone's favorite time of year again
03/29/12: GOP disillusionment is a good thing
03/27/12: Just what America needs: more red tape
03/20/12: Nation wondering: what happening to language?
02/21/12: Culture warriors resort to propaganda
02/15/12: Step away from that cookie and grab some air
02/08/12: Lessons in heresy
02/01/12: Do We Really Need Pickle-Flavored Potato Chips?
01/11/12: Shut up, they explained
12/30/11: A Modest Proposal: Let's Ban All Sports!
12/26/11: A Christmas letter from the Obamas
02/24/11: Will the next Watson need us?
12/24/10: Here Are Some Good Gifts for People You Hate
06/15/10: The Presinator
05/26/10: More than equal
04/08/10: Angry Right Takes a Page From Angry Left but guess who is ‘ugly’?
02/16/10: Either Obama owes George W. Bush an apology, or he owes the rest of us a very good explanation for his about-face on wiretapping
02/03/10: Talkin' to us 'tards
01/27/10: I never thought I'd see the day when progressives would howl in ragebecause the Supreme Court said government should not ban books
01/07/10: Gun-Control Advocates Play Fast and Loose
12/31/09: Nearly everything progressives say about neoconservative interventionism abroad applies to their own preferred policies at home





© 2011, A. Barton Hinkle

Columnists

Toons

Lifestyles

Quantcast