Washington Post Wonk Blog turns to hackery
November 18, 2012 at 2:21 pm in News by Dustin Siggins 32 Comments
Last week, The Washington Post’s Wonk Blog published a post by Ezra Klein on a new paper by the Congressional Budget Office (CBO). From the post (emphasis added):
What these three charts tell you is simple: It’s all about health care. Spending on Social Security is expected to rise, but not particularly quickly. Spending on everything else is actually falling. It’s health care that contains most all of our future deficit problems. And the situation is even worse than it looks on this graph: Private health spending is racing upwards even faster than public health spending, so the problem the federal government is showing in its budget projections is mirrored on the budgets of every family and business that purchases health insurance.
These graphs are built atop what’s called “the current policy” baseline. The current policy baseline assumes nothing changes. We don’t pass any new laws. We don’t follow through on the hard parts — like the cost controls in the Affordable Care Act — of any of the laws we’ve already passed. We don’t raise taxes.
That won’t work for very long. Page 9 of the report includes this remarkable statistic: If we just continue on the way we’re going, then “spending for Social Security, Medicare, other major health programs, defense, and interest payments” will “nearly equal all of the government’s revenues in 2020 and would exceed them from 2022 onward — leaving no revenues to cover any other federal activities, such as income security programs, retirement benefits for federal civilian and military employees, transportation, research, education, law enforcement, and many other programs.”
So we need to get health-care costs down. But because we can only do that so quickly, we’re also going to need to get taxes up.
Klein is both right and wrong in this post. Here are a few key points he makes:
- The major problem with the federal budget is indeed health care. Unfortunately, the President’s health care law will make things worse, as costs will continue to skyrocket and rationing will take place. Additionally, the massive tax increases in the law will hurt every American who pays them.
- “Current policy” shows a disastrous future for America. This assumption of future policies by CBO basically assumes Congress continues to avoid cutting spending and doing tax reform, as has been done for years.
- Klein ignores the cost of interest payments in his assessment of the government’s future budget obligations. Payments are at or near record lows, as people like Paul Krugman regularly point out, but as was noted http://washingtonexaminer.com/its-the-social-spending-stupid/article/118874#.UKO_EIaKTK1 in The Washington Examiner last year, interest payments on current debt take up hundreds of billions of dollars. According to TreasuryDirect.gov, the interest payments in Fiscal Year 2012 totaled $359 billion, though that includes an unusual decrease of $75 billion due to an accounting change in the Department of Defense. So let’s use Fiscal Year 2011’s interest payments, which totaled $454 billion…or 12.52% of the federal budget in 2011.
Remember, this is when interest rates are around three percent. What if we accumulate another trillion in debt and rates go to four percent? This would total $680 billion, quite a significant cost to taxpayers.
4. Klein says that we need tax increases to temporarily hold off fiscal troubles until health care reforms kick in. However, his assessment misses the fact that much of what the federal government does in education, transportation, security, and other areas of federal oversight are unconstitutional. Cutting those programs out would do at least as much as raising taxes, insofar as the budget deficit is concerned, and also reduce the federal government’s constant encroachment of the rights of citizens.
In short, the federal government faces massive financial problems in the near future. Liberals like Klein have identified some of the problems, but it seems they purposely ignore the facts when it comes to actually identifying solutions.
Here’s a solution to the tax revenue problem:
Every person over the age of 18 must submit an income statement to the IRS.
A flat tax is imposed on EVERYONE that equals the expenditure of the federal government minus all other revenue collected.
Then, everyone will have paid their fair share of the cost of government.
We’ll see how everyone votes when everyone has to pay their fair share of the government they vote for.
As for Social Security, the answer is simple:
IF YOU DIDN’T PAY INTO SOCIAL SECURITY, YOU DON’T GET ANYTHING FROM SOCIAL SECURITY.
Now that we’ve fixed Social Security, what other problem do you have?
Thanks, I need a good laugh.
You mean of course, a flat tax on everybody that can actually afford to pay don’t you? Or do you actually think Congress is going to apportion a tax of that size, levying it even on the unemployed, welfare recipients and retired people living solely on Social Security? (add whoever else is in “need” of “government help” to this list)
I think it would be great if Congress would do that. It would be Constitutional, and it would create a revolution against big unconstitutional government and the spending that goes along with it, but Congress will NEVER do it.
As for “fixing” Social Security- it’s a Ponzi scheme. Those who got in early did very well. Those who got in later did OK. The baby boomers, adjusting for inflation, won’t break even. Young families of today will have to pay a big percentage of everything they can manage to earn to the baby boomers, and will get little or nothing for themselves.
Like any Ponzi scheme, S.S. has reached the point where it just won’t work anymore.
Everyone can afford to pay. Period. End of statement. If you have an income from any source, of any amount, you have to give a percentage of that to the federal government.
Don’t give me this bull about the “poor”.
THERE ARE NO POOR PEOPLE IN THE UNITED STATES.
Poor people don’t have money to buy drugs and tatoos.
Poor people don’t have money to buy guns.
POOR PEOPLE DON’T HAVE THE LUXURY OF BEING IDLE ALL DAY.
(By the way, there are more beds and meals waiting than there are homeless.)
If you have any income, you should have to give part of that income to the government. Period. End of statement. No exceptions.
Let’s see how they vote when they actually have to pay for what they vote for, instead of everyone else paying for what they vote for.
A neighbor of mine, and a friend, is poor. He’s 73 years old. He grew up black in North Carolina. He didn’t get much schooling because he had to work from a young age to help support his family. He never had a job any better than driving a truck locally. He never worked anywhere that provided him with health insurance or a pension. He never made enough money to save or invest.
He and his wife now try to live on a very small Social Security payment (he did always make F.I.C.A. “contributions”) and he works whenever he’s healthy and can find any work at all.
So, he has “income”, both from S.S. and from the small amount of work he can find.
He should pay your flat tax of what, 25% of the little he now gets? He’s barely got enough to live now, and he WON’T take charity.
Politically, he thinks government at all levels has ruined our country.
“Poor” ……
You should follow me around the world and see the places I have to see. There are actually poor people there. Here, in the United States, THERE ARE NO POOR PEOPLE.
Let’s use your description of your friend:
“He’s 73 years old. He grew up black in North Carolina.”
He had all the opportunities the “Great Society” set aside for black people. If he didn’t use those opportunities to get an education, then that was his choice. I, nor is anyone else in the entire country, responsible for anyone’s poor choices. We should not subsidize poor choices. Subsidizing poor choices only propagates more poor choices, and increases the frequency of poor choices among the population.
“He didn’t get much schooling because he had to work from a young age to help support his family.”
Again, the “Great Society” subsidized poor families so the children could get an education. He chose to not get an education. I am not responsible for the choices he made.
“He never had a job any better than driving a truck locally.”
Was he the type of person who showed up for work every day… on f*****g time, worked all day, did what he was paid to do every day, and became reliable? If so, then he would have done a lot better than you describe.
My first cousin worked a career as a route man for Coca-Cola, driving a delivery truck and filling the machines. He never had much “schoolinig”. Over time he bought land, built a house, raised two daughters, always had a truck for himself and a car for his wife, always had enough to buy birthday and Christmas presents, and in addition earned enough to enjoy his favorite hobby, hunting. But, he showed up for work every day on time, did what he was paid to do every day, and became reliable in the work force. Obviously, your “friend” didn’t do that. That was his choice. I, and no one else, is responsible for the choices he made.
“He never made enough money to save or invest.”
Because he never became reliable in the workforce. Refer to the above example of my cousin.
Yes, he should pay the flat tax.
Calculations put a reasonable flat tax between 10 and 15 percent. But, if the Democrats aren’t stopped, that won’t be enough.
Perhaps if your “friend” had to pay for what he votes for, he just might not vote for some goddam Marxist communist muslim extremist just because he’s (half) black.
DBWriter must be a very lonely old man. Not many friendship opportunities out there for stupid, crazy, and racist.
Craig ran away from this. Perhaps you can answer this post. I’ll help you. Here’s the post again:
“Poor” ……
You should follow me around the world and see the places I have to see. There are actually poor people there. Here, in the United States, THERE ARE NO POOR PEOPLE.
Let’s use your description of your friend:
“He’s 73 years old. He grew up black in North Carolina.”
He had all the opportunities the “Great Society” set aside for black people. If he didn’t use those opportunities to get an education, then that was his choice. I, nor is anyone else in the entire country, responsible for anyone’s poor choices. We should not subsidize poor choices. Subsidizing poor choices only propagates more poor choices, and increases the frequency of poor choices among the population.
“He didn’t get much schooling because he had to work from a young age to help support his family.”
Again, the “Great Society” subsidized poor families so the children could get an education. He chose to not get an education. I am not responsible for the choices he made.
“He never had a job any better than driving a truck locally.”
Was he the type of person who showed up for work every day… on f*****g time, worked all day, did what he was paid to do every day, and became reliable? If so, then he would have done a lot better than you describe.
My first cousin worked a career as a route man for Coca-Cola, driving a delivery truck and filling the machines. He never had much “schoolinig”. Over time he bought land, built a house, raised two daughters, always had a truck for himself and a car for his wife, always had enough to buy birthday and Christmas presents, and in addition earned enough to enjoy his favorite hobby, hunting. But, he showed up for work every day on time, did what he was paid to do every day, and became reliable in the work force. Obviously, your “friend” didn’t do that. That was his choice. I, and no one else, is responsible for the choices he made.
“He never made enough money to save or invest.”
Because he never became reliable in the workforce. Refer to the above example of my cousin.
Yes, he should pay the flat tax.
Calculations put a reasonable flat tax between 10 and 15 percent. But, if the Democrats aren’t stopped, that won’t be enough.
Perhaps if your “friend” had to pay for what he votes for, he just might not vote for some goddam Marxist communist muslim extremist just because he’s (half) black.
On a more fundamental level. I disagree with all flat tax plans like yours. They are not Constitutional.
The Constitution clearly limits the government in it’s ability to tax.”All Direct taxes must be Apportioned.” “All Indirect taxes must be Uniform.”
I will be glad to explain any of that simple statement that you can’t understand.
I’ll also ask you a question- “Can you describe a tax on wages in such a manner as to make it clear that a tax on wages is Indirect?
Well, Craig, perhaps you can explain to everyone here that there was no such thing as an income tax when that phrase was written into the Constitution. That phrase was specifically referring to the taxation of states, relative to their respective populations as compared to the population of the country as a whole.
It has nothing to do with a graduated income tax scale for individuals, which didn’t exist at that time. It required an Amendment to the Constitution to collect taxes from individuals.
You’d know that if you knew anything at all about the Constitution.
You know as much about the Constitution as Obama, which is next to nothing. It would help our image if the president who was supposedly a constitutional lawyer actually had read the Constitution at least once in his life.
Taxes on “income” were levied prior to the 16th Amendment.
Just prior to the 16th Amendment, a man named Pollock, who had a business renting out carriages for profit, sued the government, claiming that a tax on the profit he derived from renting carriages was the same as a tax on the carriages themselves, which made the tax in question a Direct tax and therefore illegal unless Apportioned.
Amazingly enough, the Supreme Court agreed with him and invalidated the tax. (Pollock v Farmers Loan & Trust Co., essentially overruled by later cases)
In their opinion on the Pollock decision, the Court talked about the validity of a tax on wages and salaries, and the essential characteristics that would place any tax in the category of Direct- but that wasn’t the issue in question, so they didn’t rule on it.
Because the tax declared unconstitutional by the Supreme Court provided the federal government with the majority of it’s revenue, Congress got right to work amending the Constitution with the 16th Amendment- a direct response to the Court’s ruling in Pollock.
The language of the 16th Amendment makes this obvious. The intent of the 16th Amendment was to separate income from it’s source. (Mr. Pollocks carriages).
The first tax related Supreme Court case subsequent to the ratification of the 16th Amendment was Brushaber v Union Pacific R.R. Co. In the court’s opinion on that decision, they talked about the fact that the 16th Amendment did not add anything new to the taxing power of Congress, nor did it remove the Constitutional requirements that Direct taxes must be apportioned and Indirect taxes must be uniform.
The Court went on to say that interpreting the 16th Amendment to allow Direct taxes to be levied without apportionment would cause widespread and serious harm to our Constitutional system.
In among the discussions in the opinions on both Pollock and Brushaber is the reiteration of the certain legal maxim that it is the substance and effect of a tax that controls it’s legality under the Constitution, NOT it’s form. Congress cannot change reality by definition.
No matter how Congress (or you) want to squirm and wiggle and define wages (and salaries) as “income”, the substance and effect of any tax laid on wages (or salaries) is Constitutionally Direct and illegal unless it is apportioned.
A flat tax as you describe it, with wages being defined as “income” certain is a tax on wages. You are suggesting a tax on wages.
Since you are so expert in the area of taxation, I’m sure you’re aware of the “standard exemption” and the “deductions” for dependents that were included in the very first version of our current “income” tax law?
That tax was sold to the American people in this way- An exemption will be made in an amount adequate for an individual to support himself. A deduction will be allowed in an amount adequate to support each dependent.
Of course, at the time, our money was still tied to gold and silver, so the American people had no experience of inflation (and didn’t remember the inflation caused by fiat money during the Civil War), so the People believed that the wages and salaries of working people would be exempt from the tax, forever. AS usual with “progressive” programs and policies, that was a lie.
I didn’t mention that his family was very poor. Please tell me about all their opportunities.
Then tell me how an honorable young man, who, had he finished, would have graduated from high school in 1957, in a poor rural area of North Carolina, would have gotten all these “Great Society” programs you’re talking about? They didn’t exist.
He isn’t poor by the standards of poorly governed tribal countries, but he is poor enough that the government should not be taking from him the bread he earns.
I know people exactly like that. They worked every day. And, they raised famililes. Those that were irresponsible ended up with nothing. Those that acted with concern for their family first and worked every day had a middle-class living standard. It doesn’t matter what you’re race is. If you are willing to work every day, you won’t be poor.
Thanks for the history lesson. It is very informative. But, it is not relevant.
Because the 16th Amendment is a fact of life and a current part of the Constitution, Congress can tax individual income.
Let’s go back to the original argument about the flat tax concept. The proposal is:
All people over the age of 18 should file a statement of income. A flat tax will be applied to pay for the government’s spending during that tax year minus all other revenue collected by the government.
EVERYONE pays.
Then, we’ll see how people vote when they have to pay for what they vote for.
The 16th Amendment is superfluous. As the Supreme Court clearly said, it did not add any new taxing power, nor did it modify the existing limitations on the taxing power.
Congress ALWAYS had the the power to tax anything, at any rate, subject solely to the limits that Direct taxes must be apportioned and Indirect axes must be uniform.
Congress still has that power, and those limitations are still in effect.
Any tax, laid on any object, no matter the arbitrary definitions Congress might apply, or the arbitrary classification of that object by Congress, is still subject to the Constitutional limitations on the taxing power.
If the substance and effect of a tax is Direct, that tax must be apportioned. it is the substance and effect that control the legality of ANY tax, not it’s form.
A tax which has the form of an income tax, but which is, in substance and effect, a Direct tax, must be apportioned to be legal.
You are a very ignorant person. Guess what genius not everyone is as cool as you. By what your saying is that if someone is down on their luck you should just kick them and move on. People make mistakes in life. THAT’S LIFE. It’s pretty ignorant of you to say that people that are down on their luck are all drug addicts. Next your going to tell me how your pro-life right? How you believe in Jesus right?
I have been down on my luck. I have lost everything I owned twice. I made the decisions, and my venturers weren’t successful. I invested everything I had, and lost everything I had. It was my choice. When I was down on my luck, I began to pick myself up by living under a bridge (the bridge was the one connecting Corpus Christi to Portland in Texas) and cleaning bathrooms in Corpus Christi Beach. You can bet the bathrooms they let me clean were the ones that were so filthy the store employees didn’t want to clean themselves. I cleaned dumptster sites at apartment complexes on garbage day. I dug ditches. I hung drywall and roofed houses. I worked in a house framing crew, hammer framing, not nail gun cake framing. I did this for about 5 years until I got another job for a degreed professional.
If a person doesn’t do everything available to them when they’re “down on their luck” then I don’t buy any bullshit they spit out about being “poor”. If they can afford to not do the kind of work I had to do, then they’re not poor. They’re actually rich. They can afford to not work. That is the definition of “rich”.
EVERYONE pays the flat tax. No exceptions.
Pro-life….
hmmmmmm….
Well, I guess that discussion begins with the question “When does life begin?”
What’s your answer?
I guess you have to define “life” to answer that question. What is “life”? (Remember your definition has to apply it to all species.)
At what point does something begin to become what it will eventually be?
Jesus….
Yes, I believe he existed. Yes, I believe he is accurately descirbed in the jewish, muslim and christian texts. I don’t see any historical differences between the three.
Is he God?
I don’t know. I can’t even define God.
Did he give instructions for a way to live that centers around peace and love and tolerance and giving to other humans?
Unquestionably, yes.
Deos that answer your questions?
… and then you can enlighten us as to why virtually 100 percent of the black population votes for Obama. Is it because he’s the same race? Is it because he’s going to make the other races pay to support black people? Is it because all black people hate the United States? Is it because all black people support the muslim terrorists trying to destroy our country? Is it because all black people are Marxist communists?
Please explain to us why Obama gets virtually 100 percent of the black vote. Is it because virtually 100 percent of black people are racists?
How about we get one of those ole traditional patriotic chants going ….
Everybody. All together….
“God DAMN America!”
Now, doesn’t that make you feel better.
Whenever I need to convince anyone about the crazies in the Tea Party, I have them read these posts. Some of these posts set back the Tea Party movement and scare people away.
Well, there’s certainly nothing scary about the Republicans and Democrats, and where they’ve led our country!
How about this to scare those people away:
Get a job. If you can’t find a job, there are 30 million illegal aliens here. Take one of those jobs.
And, everyone’s going to have to pay their fair share of the government they voted to create. EVERYONE.
And, you can’t call yourself “poor” if you have booze to drink, drugs, designer hoodie, eat every day, sleep indoors, play basketball at midnight, and have the luxury of being idle all goddam day.
There are no poor people in the United States.
Perhaps we need some. Then, people might actually understand what it means to be poor and make the decisions necessary to avoid that life.
Wow Mr. Writer!
Here’s a suggestion, quit your job. Write yourself a resume that says “high school graduate, job experience in several unskilled areas, no bad work record, one child with health problems.”
The go see if you can get one of those vacated jobs the illegals used to have- millions of them left you know.
Been there. Done that. I grew up on a small subsistence farm in south Louisiana with semi-literate parents. We had a big family. My father worked all the time. That’s how he did it. I used the GI Bill to get an education.
I don’t expect anyone to do anything I didn’t have to do.
My friend is not you.
In any case, he did what he did, and he is where he is today, and it’s entirely too late for him to go back and finish high school or enlist in the military, and you want to tax what little he manages to earn.
And by the way, those numbers you mentioned- a 10% flat tax? Is that going to just replace current revenue, or will it be enough to avoid more deficit spending? Will it be enough to meet the rapid growth in Social Security and Medicare spending? Will it be enough to start paying down the national debt?
How long do you think it will take for the rate to climb to 15%, or 20%, or 30%? or even higher?
When flat taxation was studied, at the level of government spending prior to the recent explosion of government spending, a reasonable estimate for a flat tax was 11 to 12 percent.
If the Democrats continue on the current path, those numbers may not be what is required today.
The only way to get spending under control is to threaten the positions of people controlling spending – Congress.
If everyone had to pay their fair share of the cost of the government they voted for, I’m sure they would put people in Congress that didn’t cost them so much. And, anyone who wanted to stay in Congress would have to explain very well to their constituency why they had to pay what they’re paying.
The bottom line is, no free rides. EVERYONE pays for the government.
So you admit the flat tax you want to see levied on my poor friends wages will be, even initially, much higher than 12%.
Or do you want to continue borrowing and deficit spending, and never pay down our National Debt?
Craig Sickler said on November 19, 2012
On a more fundamental level. I disagree with all flat tax plans like yours. They are not Constitutional.
The Constitution clearly limits the government in it’s ability to tax.”All Direct taxes must be Apportioned.” “All Indirect taxes must be Uniform.”
I will be glad to explain any of that simple statement that you can’t understand.
I’ll also ask you a question- “Can you describe a tax on wages in such a manner as to make it clear that a tax on wages is Indirect?
Thought I’d move this down so as not to be confused with other topics.
Craig, are you aware of the fact that when the phrase ” all direct taxes must be apportioned” the individual income tax didn’t exist? In fact, an amendment to the Constitution was required to collect income taxes from an individual.
The part of the Constitution you reference refers to taxes from states. The Constitution states that a state with a small population does not have to pay the same amount in taxes as a state with a larger population.
You really don’t know much about the Constitution, do you?
You seem to know as much about the Constitution as Obama. You’d think that a president who supposedly was a constitutional lawyer would have read the Constitution at least once.
Craig wrote: I’ll also ask you a question- “Can you describe a tax on wages in such a manner as to make it clear that a tax on wages is Indirect?
A tax collected on wages is a direct tax.
I didn’t suggest a tax on wages. I stated with no uncertain verbiage everyone over the age of 18 should be required to submit a statement of INCOME. It doesn’t matter if that income is from wages, or interest on savings, or any other source. If money is paid to an individual from any source, that is income.
Corporate tax law can be addressed, if necessary. That would fall under the category of “other revenue to the government” that would be subtracted from the government spending during that year to calculate the percentage of the flat tax every indivudual in the entire country over the age of 18 would have to pay.
You suggest a tax on “income” which you define to include wages. Therefore, you suggest a tax on wages.
You agree that a tax on wages is Constitutionally Direct.
How does that tax escape the Constitutional requirement that Direct taxes must be apportioned?
“Apportioned” was a term used in the Constitution prior to individual taxation. It applied to states. A small state, or a state with a relatively small population, cannot be required to pay the same amount in taxes as a large state, or a state with a large population.
As used in the Constitution, the word “apportioned” applies to the constitutionally allowable taxation that existed at that time. The 16th Amendment changed that. Direct individual taxation is not related to the constitutional requirement tha taxation from the various states must be approtioned.
The term apportioned, when used in the Constitution, applied to both taxation and representation.
When the people who wrote, and ratified, the Constitution, granted the Congress the power to tax, they most certainly contemplated that the taxing power, broad and inclusive as it was, might be extended to individuals. That’s exactly why they included the limitations on the taxing power. Apportioning Direct taxes, such as taxes on property, on wages and on salaries as intended as a check on that power that would make it extremely difficult to levy Direct taxes.
The Founders imagined that the national government would be held to it’s few enumerated powers, and that import tariffs would be adequate to furnish all the revenue necessary to accomplish the duties of that government.
Again, paraphrasing the Supreme Court when they spoke of the original taxing powers granted by the Constitution- “The taxing powers granted by the Constitution are broad and inclusive. They encompass every type of tax that has been imagined, or might be imagined, and they may be levied without any limitation other than those found in the Constitution; Direct taxes must be apportioned, and Indirect taxes must be uniform.
The 16th Amendment changed nothing. It was a direct response by Congress to the Supreme Court’s decision in the Pollock case, a decision that was later essentially overruled, making the 16th Amendment superfluous.
Misrepresenting reality does not change it.
I haven’t actually dropped out of this discussion Mr. Writer, it’s just that my comments seem to be “awaiting moderation”, and I’m waiting for the moderator to tell me why.