25 July 2010

So Crazy, It Just Might Work

While I am a left leaning sort of guy, I am aware that human nature is not nearly as benign as many lefties tend to think. People can be mean, selfish, hostile, even evil. Especially so, when the consequences of their acts are separated from the acts themselves. If sex produced children in a week, for example, people (meaning men) would have a lot less sex. The nine months wait is long enough to lose track of cause and effect.

This same pattern is true in government. The massive deficit we have now has deep roots in the tax rebate we got almost ten years ago. (Remember the check?) The surplus was bad, remember? Give it back to the people, remember? Then came the calamity of 9/11, and in three years we were spending lots of money on two wars.

And yet, did we raise taxes to pay for those wars?

No, we lowered them again, taxes being bad and all that. So we started spending money we did not have, way back in 2002. And now we seem to have forgotten all that. By one estimate (click on the link) the cost of the wars accounts for more than half of the discretionary spending Congress appropriates.

Now, if we are serious about reducing the deficit, there are two ways to do that. One is raise taxes.

OMG! Taxes!

OK, then reduce spending. When you look at the chart, where would you start?

Tough choices. And we would not have to make such a tough choice if we knew what it would cost when we made it. So I have an idea. It's a crazy idea, but it might just work.

War Taxes. What if we could only go to war if we created a tax to pay for that war? I think we need a constitutional amendment that requires Congress to levy a separate and distinct tax any time they approve military intervention.

Your pay stub would have boxes for income tax, social security (FICA) and war. Your W2 and 1040 would include special calculations to figure your war tax along with your income tax. Everyone would know their stake, responsibility, whether they were in the services or not.

War costs money. Far more than the Depression, World War II bloated the federal government. At the height of the war, almost 40% of the GNP was flowing through the government. It happened in the Civil War as well, the first time an income tax was approved.

But if we had to pay for it personally, through a distinct tax that would grow every time the cost went up, at least we might see it when it happens. And who knows, we might actually question the sunshine patriots in Congress who are always willing to fight to very last drop of someone else's blood or the last farthing in someone else's purse.

I know. It will never happen. But maybe it should.

2 comments:

Joel Monka said...

As a conservative, (as opposed to a Republican who talks about conservative values if he thinks it will win a few votes) I agree with you about Bush's fiscal irresponsibility. I'm not alone, either- the ranks of the Libertarian party are now bloated with ex-Republicans who left the party because of him. I also agree that wars MUST be paid for, although I'm not certain a Constitutional amendment such as you describe is the best formula- much of WW II was paid for with bond drives, you may recall. But I can't really argue much with your proposal.

I can, however, argue with your assessment of war costs- Daily Kos is not the best source of information on such things, especially when the official government figures are easily available online. The figures for 2010 are, of course, not firm, as the budget year is not over, but here is what was appropriated: Department of Defense plus Overseas Contingency Operations (the special war appropriation): $663.7 Billion. Estimated budget deficit: $1.17 Trillion. That means we could cancel the wars in Iraq and Afghanistan, fire every member of the Defense Dept, uniformed or not, and turn the Pentagon into condos for the poor and STILL have a budget deficit of $507 Billion! Actually, the situation is worse than that; the initial deficit estimates were low- we now know they will be in excess of $1.4 Trillion.

WFW said...

Joel,

I only said "one estimate." It surely is a bunch of money one way or the other.

And bonds are themselves deferred payments, but I like them, as individuals buy them and thus make the commitment. Maybe we could finance all wars through bonds, and the tax could be used to repay them. Only military contractors would be prohibited - conflict of interest.

The deficit, of course, is a moving target. Changes in GDP and such make it both actually and relatively larger and smaller. Some debt is not unhealthy, as my mortgage attests. The question is how much. And as you imply, how much depends a lot on one's economic philosophy.

I will say that it seems ironic to me that the same body that makes all its choices in the light of the next election can seem so passionate about something that is years away. If they only had the same long term view on climate legislation, infrasructure...