Since President Barack Obama’s budget for the fiscal year 2012 only cuts domestic discretionary spending and leaves entitlements and defense untouched, the Federal Government will remain in the red for probably this entire decade unless Congress pushes for deeper spending cuts.
Domestic discretionary spending doesn’t even account for 15 percent of the president’s $3.7 trillion budget. Only by reining in entitlement spending or dramatically raising taxes can the government manage to balance the books.
It shouldn’t surprise anyone which of those The Huffington Post favors.
As Ryan Grim reminds us, “Willie Sutton famously said he robbed banks—not poor people—because that’s where the money is.”
Getting serious about closing the deficit would mean investing in growth, which boosts revenues but costs money in the short term, and raising taxes on the wealthy.
In other words, the administration should take money from “the wealthy” now in order to boost growth—in order to take more money from the rich once growth is achieved.
Not only has government “stimulus” utterly failed at producing growth; such class politics are deeply misguided and immoral.
Why should someone pay more taxes because he earns more income? “From each according to his ability” is how Karl Marx put it and his alternative to the free market should not require an elaborate repudiation anymore.
The problem is not that the wealthiest of Americans pay too little in taxes. In fact, the richest 1 percent of the population, while earning 19 percent of all income, pay 37 percent of all income tax. The top 10 percent of income earners pay 68 percent. The bottom 50 percent meanwhile, while earning 13 percent of all income, pay just 3 percent of all income tax.
The problem is that the Federal Government spends too much—on entitlement and on welfare; programs which the government should not bother with in the first place.