Tax cuts versus Debt cuts
Question: Greenspan likes tax cuts mainly b/c with the current growth trend we’ll pay off the national debt between 2005 and 2015 (thats if we have the next depression as piddy would have you think). Face it, the conglomeration of wealth amongst the top %1 in the world is incredibly massive. Esp in the United States. The argument isn’t whether rich people deserve or need tax cuts, its what is our priority: Debt reduction or huge tax cut? The huge tax cut (and 2 trillion is pretty huge) creates a more likely outcome of returning to deficit spending and increased debt. The balance between giving back taxes, reducing debt, and maintaining our budget priorities ($5 billion more so far for military personnel, ‘National Missle Disgrace’, and the like, is very precarious. I hope Congress doesnt f* this one up…..
Answer: I think so. Anyway you cut it, Gen X and younger gets stuck with the bill. That is already the case with education — the same yahoos who benefitted from lax student loans and next-to-nothing tuition fees have tightened the former and raised the latter by over 100%, and climbing. The tax cuts simply reward the high-earners, a majority of whom are in the upper age bracket — ie, the same ones who benefitted from profligate spending in the late 60s through 1970s and 80s.
Our generation will pick up the tab. That is almost guaranteed. It will get even worse when the aging boomers start tapping various pension plans and demanding more health benefits and services for seniors. We had this debate here in Canada a few years ago. My opinion at the time and still is the following.
The huge debts, both in Canada and the US, were incurred during the time of the “baby boomer” generation. They benefitted from the free spending ways and now my generation is supposed to pick up the entire cheque for a party we never attended. I think not. Give me tax cuts any day. Here’s a crazy thought. Raise inheritance tax to 100% so that those who benefitted from the debt spending can pay it back.
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