Whew! I just talked to an eminent tax expert and discovered that I don’t make enough money to be hit hard by Rep. Charlie Rangel’s mammoth tax hike, the largest proposed tax hike in history. It may even be that I will get to keep several hundred dollars a year more, or that I if I lose money, it will be, at most, around the same amount. The tax code is so complicated I don’t dare speculate.
Either way, though, I personally won’t suffer immediate pain.
Being a single woman, I won’t be affected, as will many far-from-rich families, by what the Rangel tax hike would do to married women who work. (See my colleague Carrie Lukas’s analysis of this at iwf.org.)
Why, then, am I terribly worried about the proposals?
Well, not for reasons of sycophancy towards the rich. My reasons for intense opposition to the tax hike are based on justice, concern for the economy, and self-interest. Yes, self interest. Even if the tax rates don’t directly and immediately empty my pockets, I know that eventually I will be adversely affected.
We all benefit when the economy hums, but the Rangel hike, as it is written, will stick it to small businesses, the engines of the economy, and especially to small businesses engaged in manufacturing. This will affect employment and investing. Bad as this is, worse would very likely follow. Rangel is just the beginning.
This is because Mr. Rangel’s tax proposals, says J. D. Foster, a tax analyst at the Heritage Foundation, are a political statement. They won’t become reality with George W. Bush in the White House, but they could signal the direction of a White House with a different philosophy. The most important fact to absorb about the Rangel proposals is that it would be a trillion dollar tax increase. And that, gentle reader, would not be the end of the matter.
“The only justification [for the Rangel hike],” Foster told me, “is that Congress wants to spend more money, and the Rangel bill is a down payment on the tax increases the Democrats will need to spend all the money they want to spend.”
If the Rangel tax hike were enacted into law, government spending would skyrocket. Pay-go would become very go-go. I don’t have a crystal ball, but I am going out on a limb here and predicting that, if the Democrats control the White House and both houses of Congress, the Bush tax cuts will be repealed. With go-go spending, and projects that those in power deem worthy, there won’t be enough money to do all these good things. There will be only one thing to do: increase taxes on people who haven’t yet been hit by the Rangel hike. So those who breathe a sigh of relief that we won’t have to cough up more than a few hundred dollars, are living in a fool’s paradise. We will-and it won’t be that far off.
Flush with cash (at least until the economy is chocked by high taxes), the government will spend recklessly. My least favorite programs are the entitlement programs that create a permanent underclass. The number of these programs will grow exponentially, and the number of people injured for generations will rise. It is not just to force self-reliant taxpayers to fund the indigence and, worse, the moral destruction of others.
When taxpayers are allowed to keep their earnings, they fund charities that they approve. These charities, if they have oversight and time limitations, can be far more effective than crippling entitlement programs.
Sometimes when I say my prayers at night, I thank the good Lord for allowing me to have my modest success with book sales while George W. Bush is president. Welcome added income, most of it has gone towards retirement.
And, frankly, I refuse to believe that there is anybody more deserving of my earnings than…well, me. I maintain that this is good for Uncle Sam, too, because the more I save, the less he’ll end up doing for me. It’s a win-win.
And don’t call me selfish. It is selfish of Mr. Rangel & Co. to want to take my money for their programs. But they do.
Charlotte’s Web is a weekly column by Charlotte Hays, Senior Editor for the Independent Women’s Forum and can be contacted at [email protected].
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