Wednesday, October 5, 2005

Shared sacrifice: Tax hikes for spending cuts

Commentary by David Reinhard


By DAVID REINHARD

David Reinhard

This has never happened here before, and it has taken some getting used to on the part of your scribe. House Minority Leader Nancy Pelosi has actually done something that makes sense, while President Bush has taken a position that's disappointing in the extreme. There, I said it.

Yes, the almost invariably wrong-headed San Francisco Democrat offered up $70 million out of the $129 million in special projects she had won for her district in the recent transportation bill to offset hurricane relief costs.

And Bush? The usually sound president opposed raising taxes in order to help pay for Gulf Coast reconstruction.

Now, I yield to no one in my zest for tax cuts in general. The Bush tax cuts have been a good deal for the post-9/11 economy and government revenues. I also believe that if we didn't want to add federal red ink to pay for the Gulf Coast cleanup -- and there's no reason we shouldn't add to the deficit to pay for some of these long-term disaster-related investments -- we could find all the money in offsetting spending cuts. But it seems self-evident that, when you're in the middle of fighting a war and confronting epic natural disasters, a temporary tax increase tied to spending cuts is a responsible response, provided the temporary taxes won't hurt the economy.

Call me quaint, but Democrats and Republicans should be working in times like this to craft a tax-and-spending compromise of shared sacrifice. Pelosi's pledge to forgo some pork-barrel spending is a step in the right direction. Bush's reflexive refusal to consider any tax hike is not.

Obviously, Pelosi's is only a small piglet step. In the transportation bill alone, there are some 6,000 "earmarked" projects totaling almost $25 billion. After Katrina and Rita, Republicans and Democrats should be offering up their pork-barrel projects -- "vital" local projects of dubious national importance -- and trimming other government spending.

Can even a member of Congress look at the Gulf Coast wreckage and fret about the deficit and then go ahead with plans for a $200 million "bridge to nowhere" to serve an Alaskan island with 50 residents? Or a $75 million Washington, D.C., metro extension? Or $15 million for a new ferry system in the New York City area? Or even $2.5 million in federal cash for the Blue Ridge Music Center?

Yes, I know these porkers are far from Oregon. What of home-style pork? The transportation bill includes 133 specific projects for Oregon totaling $366 million. There is $1.2 million to build a new light-rail station in Gresham, and $4 million for the Portland streetcar project.

Surely, those who say they're worried about the Gulf Coast cleanup's impact on the deficit can bring themselves to delay such projects until the next transportation bill. Surely, those who champion higher taxes would want to slice their own pork to retain a shred of credibility on tax increases.

In fact, they'll have to go beyond simply delaying transportation earmarks. They'll have to embrace significant cuts in other spending programs. Don't tell us every last dime of federal domestic spending is more critical than the hurricane relief effort.

The Republican Study Committee "Operation Offset" includes $500 billion of specific savings, and Sen. Lindsey Graham, R-S.C., and Sen. John Ensign, R-Nevada, have suggested across-the-board cuts in non-defense spending. Ensign said he would be open to revoking tax cuts if necessary.

It's not clear we need to go that far. You don't want to do anything that would harm the economy and, thus, hurt hurricane recovery efforts and reduce revenues to the treasury. But, again, a temporary tax that's part of a compromise crisis package with budget cuts and pork-barrel givebacks seems right.

It might include a minor surtax or a temporary fuel tax. In addition to paying for storm damage and the war on terror, it would promote energy conservation and reduce our dependence on autocratic oil-producing states that have financed global terrorism.

In advocating a fuel tax, The Washington Post's editorial page pointed up this compelling irony: "Because of the energy tax, producers would face lower demand and lower market prices; they would, in effect, pay perhaps a quarter of the energy tax, with consumers picking up the balance. Fuel-tax revenue would ease the pressure to raise taxes to plug the budget deficit, so Americans would come out ahead; they would be getting Saudi Arabia's help. . . ."

I have no illusions that a truly bipartisan accord with a temporary tax increase and spending cuts would get very far along Pennsylvania Avenue. Today's political world is too polarized. But I continue to long for a better politics that recognizes things have changed since 9/11, that we're all in this together and we all need to compromise and sacrifice.

So, I continue to have hope. After all, I never thought I'd be praising Nancy Pelosi for pushing away a helping of pork.




 Local Weather 
Search archives:


Copyright © 2024 Express Publishing Inc.   Terms of Use   Privacy Policy
All Rights reserved. Reproduction in whole or in part in any form or medium without express written permission of Express Publishing Inc. is prohibited. 

The Idaho Mountain Express is distributed free to residents and guests throughout the Sun Valley, Idaho resort area community. Subscribers to the Idaho Mountain Express will read these stories and others in this week's issue.