Our View: Not one ‘cliff,’ but three
We know all about the “fiscal cliff,” though it seems now it may prove little more than a gently sloping knoll. No less a power broker than Sen. John McCain, R-Ariz., believes this lame-duck Congress will kick the proverbial can down that knoll — and into the next full session.
Still, as a number of observers have hastened to point out, the “cliff” is not merely “fiscal” — but something deeper or, to be more accurate, steeper. Writer, lawyer, and radio talk-show host Mark Levin says the “cliff” is “societal.” Social scientist Charles Murray calls it “philosophical.” They are both on to something. This is more than about mere finances, and all about how we look at ourselves, as individuals, in relation to government.
Still, for the moment, fiscal and economic arguments are being made, particularly with regard to “fairness,” or how much certain folks — “the rich” — should fork over to Uncle Sam. Let’s dispense with all that by going to the calculator. If income tax rates were raised on the wealthy, the top 2 percent, to Clintonian levels — 39.6 percent, as President Obama apparently desires — revenues would increase by a “mere” $82.4 billion annually, or enough to fund the federal government for 81⁄2 days at current spending levels.
So what’s the point here — except to score cheap political, or punitive, points at the expense of that segment of society which happens to create most of the nation’s wealth, for others as well as themselves?
Simply stated, we will never tax our way out of this fiscal mess. Nor, it’s been said by some, can we grow our way out of it either. Nonetheless, for the benefit and well-being of all Americans, a growth strategy is the best, and only, place to at least start this process. The key: get more people working and paying taxes, fairly levied.
How best to do that? Implement policies that inspire investment, innovation, and risk-taking. Free all that capital languishing on the economic sidelines. Raising taxes on the entrepreneurial class is not the way to do it (read Thomas Sowell’s column at right).
Granted, even growth will not prove sufficient — that is, if we don’t rein in spending, ultimately on entitlements.
Now we hear that Republicans are willing to place “revenue” (read, “higher taxes”) on the table — so much the better, goes the argument, to force President Obama’s hand on entitlement reform. That may sound like good politicalstrategy, but raising taxes is as counterintuitive as it is counterproductive — that is, if your intent is to grow the economy and put more Americans back to work.
Such “strategery” may avert, at least momentarily, a plunge off the “fiscal cliff,” but what of the “societal” and “philosophical” cliffs?