Tuesday, June 29, 2010

Steve Chapman's 'consistent budgetary restraint' ?

Chicago AM 29 June 2010

Voice of the People, Chicago Tribune


The Chicago Tribune's Steve Chapman opened his Sunday June 20 column “An end to spending excess?” with the uncontestable statement: “One of the reasons the federal budget is chronically in the red is that most people ... couldn't care less.” The best he can do to explain this conundrum is thotless statements about the national debt being “an unfathomable abstraction” and “few people” lose sleep worrying if the budget will ever balance.

The reason no one cares about the federal budget is clearly stated in the 2010 Statistical Abstract of United States, table #468, page 311 that shows in 2008, 62% of the total federal government receipts of $2.745 trillion was withheld from wages. So nearly 2/3 of all the actual dollars that came into the US general fund were from employer bank accounts, not employee's . Employers can pass all of this on in price increases, so the federal government is 2/3 funded by a silent national sales tax. Because of a regularly expanding national economy, it's all but painless to voters.

This could be fixed by changing paragraph 3402 of USC Title 26 — 'Internal Revenue Code' Subtitle C 'Employment taxes' Chapter 24 'Collection Of Income Tax At Source On Wages'... from "every employer making payment of wages shall deduct and withhold upon such wages a tax..." to "every employer making payment of wages shall pay all of those wages to the employee...." The employer would still calculate the tax, replacing the reassuring (but thoroly misleading) note "you earned and your employer paid" with "here is how much the feds are expecting you personally to send in within 30 days"

Would this be inefficient? Certainly for an insatiable federal bureaucracy. But after a few months writing checks to the Federal Government for 20% of their take-home pay, tax payers would start showing considerable interest in where that money is going, and react at the ballot box.

Mr. Chapman continues listing various signs and opinions that might lead to the public's coming to their senses on the spending, concluding his coloumn with “We have not reached a new era of consistent budgetary restraint. But it looks like the age of excess is over.”

Had he done more research on just the Bush/Obama administrations' budget records, he might have skipped that optimistic close. Treasury Department figures show that the first six years of the Bush admnistration ran up deficits of $20 billion dollars a month, but included 25 months with surpluses. With a Democrat House of Reps in the last 2 years, that average went up to $35 billion a month, but even here there were nine months with surpluses. But now just the first 16 months of the Obama administration the monthly average debt increase is $122 bullion a month, and not a single month with a surplus..

Arnodl H Nelson

No comments: