Earlier this week, I blogged about the “cost” of tax cuts, and mentioned that such terminology reveals a mindset among collectivists and the ruling class that all income is property of the government. Treasury Secretary Timothy Geithner further illuminates this mindset when he states that allowing slightly lower tax rates on upper-income tax earners to continue would not be “a good use of limited resources.”
In this article, Sheldon Richman rightly slams Geithner’s comments:
I see four pernicious assumptions right off the bat. Geithner assumes:
1) Incomes are a common-pool resource the use for which is properly the government’s province, thus
2) Cutting taxes – that is, leaving additional money in the pockets of those acquire it – is a form of government spending.
3) Whether a sum of money is to be left in someone’s pocket is properly determined according to politicians’ and their court economists’ estimate of its effect on the macroeconomy.
4) Politicians know better what to do with the money than do those who will receive it through their transactions.
Balderdash. All of it.
Moreover, as Richman points out, Geithner assumes that the only way to possibly reduce deficits is by confiscating more of the legally earned income of individuals. Reducing the amount of our money the government spends never crosses Geithner’s mind, even though to “pay” for extending the tax cuts would amount to reducing by less than 2 percent the annual federal budget.
Richman concludes that transferring more wealth from those who rightly earned it into the hands of politicians is rarely a good idea:
Finally, even if all that I’ve said were invalid, there remains the unalterable fact that if the tax cuts expire, politicians will control the money. They say they will pay down the debt, but who in his right mind believes that? They’re more likely to bail someone out. Government as we know it is a transfer machine.
Sen. John Kerry says this is no time to “reward” – with tax cuts – people who have done well financially. His alternative is to reward the politicians who have made such a mess of things. That his suggestion fails to evoke universal scorn only shows what bad shape this country is in.