Tax Increases Are Spending Cuts
Late in Obama’s long budget speech – right about the time Joe Biden lost consciousness – the President finally laid out the broad outlines of his balanced budget proposal:
“This is my approach to reduce the deficit by $4 trillion over the next twelve years. It’s an approach that achieves about $2 trillion in spending cuts across the budget. It will lower our interest payments on the debt by $1 trillion. It calls for tax reform to cut about $1 trillion in spending from the tax code. And it achieves these goals while protecting the middle class, our commitment to seniors, and our investments in the future.”
Okay, so we’ve got $2 trillion in spending cuts, $1 trillion less interest, and we’ll cut $1 trillion in spending from the tax code… hey, wait a second! How do you cut a trillion bucks in spending from the tax code? The tax code is how the government takes in revenue. It doesn’t “spend” money.
Let’s apply a little Obama logic. If the government is the rightful owner of all resources, then every dollar retained by private citizens is a dollar the State “gives” them. That’s why socialists describe tax cuts as a “gift” or “expense.”
Obama used this reasoning several times in his speech. He said we made our fiscal problems worse “with trillions of dollars in unpaid-for tax cuts,” which were a boon to “every millionaire and billionaire in the country.” These cuts will “force us to borrow an average of $500 billion every year over the next decade.” He claimed that “in the last decade, if we had simply found a way to pay for the tax cuts and the prescription drug benefit, our deficit would currently be at low historical levels in the coming years.”
To Obama, the matter at hand does not involve reducing the cost of government to match its revenue, or returning economic liberty to the people by lowering their tax rates. It’s a question of “paying” for tax cuts, which must therefore be something the government purchases, and dispenses to lucky citizens as a gift.
The game was conclusively given away when Obama declared, “There’s nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires.”
There’s our trillion dollars in “spending” cut from the tax code! If tax cuts equal spending, then tax increases equal spending cuts. That’s the kind of spending cut this hopelessly out-of-touch President can eagerly get behind.