From The New York Times, 1/27/04:
http://www.nytimes.com/2004/01/27/opinion/27KRUG.html?n=Top%2fOpinion%2fEditorials%20and%20Op%2dEd%2fOp%2dEd%2fColumnists&adxnnl=1&adxnnlx=1075233216-zNDCdbYljc/LZXZxsR5PeQ
Red Ink Realities
By PAUL KRUGMAN
Even conservatives are starting to admit that George Bush isn't
serious when he claims to be doing something about the exploding
budget deficit.
At best -- to borrow the already classic language of the State of the
Union address -- his administration is engaged in deficit
reduction-related program activities.
But these admissions have been accompanied by an urban legend about
what went wrong.
According to cleverly misleading reports from the Heritage Foundation
and other like-minded sources, the deficit is growing because Mr. Bush
isn't sufficiently conservative: he's allowing runaway growth in
domestic spending.
This myth is intended to divert attention from the real culprit:
sharply reduced tax collections, mainly from corporations and the
wealthy.
Is domestic spending really exploding?
Think about it: farm subsidies aside, which domestic programs have
received lavish budget increases over the last three years?
Education?
Don't be silly:
No Child Left Behind is rapidly turning into a sick joke.
In fact, many government agencies are severely underfinanced.
For example, last month the head of the National Park Service's police
admitted to reporters that her force faced serious budget and staff
shortages, and was promptly suspended.
A recent study by the Center on Budget and Policy Priorities does the
math.
While overall government spending has risen rapidly since 2001, the
great bulk of that increase can be attributed either to outlays on
defense and homeland security, or to types of government spending,
like unemployment insurance, that automatically rise when the economy
is depressed.
Why, then, do we face the prospect of huge deficits as far as the eye
can see?
Part of the answer is the surge in defense and homeland security
spending.
The main reason for deficits, however, is that revenues have plunged.
Federal tax receipts as a share of national income are now at their
lowest level since 1950.
Of course, most people don't feel that their taxes have fallen
sharply.
And they're right: taxes that fall mainly on middle-income Americans,
like the payroll tax, are still near historic highs.
The decline in revenue has come almost entirely from taxes that are
mostly paid by the richest 5 percent of families: the personal income
tax and the corporate profits tax.
These taxes combined now take a smaller share of national income than
in any year since World War II.
This decline in tax collections from the wealthy is partly the result
of the Bush tax cuts, which account for more than half of this year's
projected deficit.
But it also probably reflects an epidemic of tax avoidance and
evasion.
Everyone who wants to understand what's happening to the tax system
should read "Perfectly Legal," the new book by David Cay Johnston, The
Times's tax reporter, who shows how ideologues have made America safe
for wealthy people who don't feel like paying taxes.
I was particularly struck by Mr. Johnston's description of the
carefully staged Senate Finance Committee hearings in 1997-1998.
Senators Trent Lott and Frank Murkowski accused the I.R.S. of
"Gestapo"-like tactics, and Congress passed new rules that severely
restricted the I.R.S.'s ability to investigate suspected tax evaders.
Only later, when the cameras were no longer rolling, did it become
clear that the whole thing was a con.
Most of the charges weren't true, and there was good reason to believe
that the star witness, who dramatically described how I.R.S. agents
had humiliated him, really was engaged in major-league tax evasion (he
eventually paid $23 million, insisting he had done no wrong).
And this was part of a larger con.
What's playing out in America right now is the bait-and-switch
strategy known on the right as "starve the beast."
The ultimate goal is to slash government programs that help the poor
and the middle class, and use the savings to cut taxes for the rich.
But the public would never vote for that.
So the right has used deceptive salesmanship to undermine tax
enforcement and push through upper-income tax cuts.
And now that deficits have emerged, the right insists that they are
the result of runaway spending, which must be curbed.
While this strategy has been remarkably successful so far, it also
offers a big opportunity to the opposition.
So here's a test for the Democratic contenders: details of your
proposals aside, which of you can do the best job explaining the
ongoing budget con to the American people?
___________________________________________________
The intentions of this industry-controlled fraudulent administration
are to rape this country, destroy its treasures, walk away with the
loot, and turn the wreckage and the blame over to the opposition.
Harry
.
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