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Tax cutters's vision: Them that has, gets

Posted: Wednesday, July 26, 2000

Congress has been as busy as a bigamist on his wedding night of late, keeping the world safe for rich people. Hardly a day passes that they don't bring out another bill that would reduce taxes, do away with taxes or help people avoid taxes, all in the name of tax fairness. The measures have largely been sold as tax relief for the poor and downtrodden taxpayer of modest means - and they do give some small relief to the lower middle classes - but it you look closely, you'll find that most of the benefits wind up in the pockets of people with deep pockets.

President Clinton has promised to veto most or all of the Republican proposals - ``In good conscience, I cannot sign one expensive tax break after another without any coherent strategy for safeguarding our financial future,'' he said - but they are starting to pick up support from Democrats. You would think it's an election year or something.

Don't get me wrong here - I am not a big fan of paying taxes. I would perfectly happy if Congress were to pass a bill exempting just me from taxes altogether.

But somehow that doesn't seem fair, does it? I mean, we do need money to run the government - build roads to attract traffic jams, put up useless missile shields, pay special prosecutors to martyr Cabinet officers, that sort of thing - so it only seems right that we all share in the expense.

And if the government does have money left over and wants to cut taxes, it seems even righter that it start with people who are having a tough time making ends meet, rather than people who are in the market for a vacation home.

Part and parcel of this whittling away of our tax base is the talk of tinkering with Social Security. I fear that if we elect young Bush president and give him a Republican Congress, we shall soon see some sort of individualized privatization of Social Security: basically another leap toward the ``Them That Has, Gets'' Society that we've been galloping toward for the past 20 years.

One of the conceptual problems with our Social Security system is that it's been misrepresented from the very beginning, as a retirement trust fund; that is, a system that allows working people to put away money that will be waiting for them in their old age. It's never been that. Rather, it is a pay-as-you-go system that funds retirement payments out of current tax revenues.

True, we have this special tax that goes into a ``fund'' that's earmarked for Social Security, but that's really an accounting fiction. That money, as it's collected, is immediately loaned to the government, which uses it for anything it wants to, some for payments to retired people, some not.

(It's that, by the way, that makes it seem as though Social Security funds only draw 2 percent interest, a falsehood much favored by the privatization people. The Social Security ``Trust Fund'' seems to draw that lousy interest because much of it isn't invested at all, but is instead paid out immediately in benefits.)

The Social Security program is one of the cornerstones of social justice in our society. It is central to the intergenerational pact older people make with the young. We say to our youngsters: ``We will raise you, educate you at public expense and keep you safe from harm as best we can. In return we expect you to make sure we don't have to spend our old age eating dog food and unable to afford decent medical care.''

At present, we are doing a much better job with the second half of that bargain than the first. Poverty among the aged has been reduced dramatically in recent decades, even as poverty and general wretchedness among the young has increased.

I think if we have money left over in the form of a budget surplus, we should spend it on our young, whom we depend on to support us someday - particularly on their education - rather than improving the lives of well-to-do people whose lives are already pretty good, if not great.

If we expect our current crop of kids to take care of us when we're old, we going to have to take better care of them now.

Don Kaul is a columnist for Tribune Media Services.



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