Op-Ed on Government Priorities and the Wealth Gap
IF TAXES CUT, WILL NATION BLEED? YES: EXCEPT THE VERY RICH, OF COURSE
Publisher's note -- this article appears with the permission of the author and was distributed by the Knight-Ridder/Tribune wire service. (c) Copyright Holly Sklar.
by Holly SklarIf your family saved up money by neglecting your kids, going without health care and ignoring needed home repairs, would you say you had a budget surplus? Now imagine giving much of your ``surplus'' to the wealthiest people in town. That's what Congress wants to do.
The richest 1 percent of households already have more wealth than the entire bottom 95 percent combined, and Congress wants to give them tax cuts averaging more than $46,000 a year. The wealthy campaign donors Congress represents will be laughing all the way to the bank.
The families in the poorest 20 percent would get an average tax cut of $24, according to Citizens for Tax Justice. The richest 1 percent of households would get tax cuts averaging more than 1,900 times as much as the bottom 20 percent.
When the Senate passed its first version of legislation giving tax cuts to the rich, it voted down an increase in the minimum wage. The House-Senate compromise bill provides tax cuts worth double an average worker's yearly pay for those at the top and half a day's pay at minimum wage for those at the bottom.
The dirty little secret behind the tax-cut schemes is that there is no real budget surplus. The paper surplus is largely a product of past and future cuts in everything from school repair to bridge repair to health care.
Just like the budget-busting Reagan tax-cut boondoggle of 1981, Republican leaders want to use tax cuts to reward the rich while gutting government programs that serve everyone else.
To come up with the ``surplus,'' tax cutters assume that over the next decade federal discretionary spending -- defense, law enforcement, highways, mass transit, air traffic control, job training, education, community development, environmental protection, disease control, veterans hospitals, national parks, research and development, and so on -- would be cut by 15 percent, adjusting for inflation and population growth. And there won't be any emergency spending for hurricanes, tornadoes or anything else.
Since Congress has a habit of giving the Pentagon more than it asks for, not less, nondefense discretionary spending would likely be cut by at least 36 percent, according to figures from the Congressional Budget Office and the Center on Budget and Policy Priorities.
We do have some very real surpluses. We have a surplus of more than 43 million Americans, many of them children, who don't have health insurance of any kind. Lack of health insurance is associated with a 25 percent higher risk of death.
We have a surplus of 13 million people who live in severely substandard rental housing or pay more than half their income for rent. Federal funding for low-income housing was cut by 80 percent from 1978 to 1991, adjusting for inflation. Between 1994 and 1998, the number of HUD-assisted units dropped by 65,000. Waiting times for Section 8 housing vouchers have risen to 10 years in Los Angeles, eight years in New York, seven years in Houston and five years in Memphis, Tenn., and Chicago.
We have a surplus of 1 million eligible kids who can't get into Head Start because there aren't enough slots. We have a surplus of kids going to school in overcrowded buildings that are literally falling apart. According to the Government Accounting Office, we need $112 billion more for school repair.
We have a surplus of people who work, but don't earn enough to make ends meet. According to a recent Census Bureau report, one out of five Americans lives in a household with difficulty in meeting basic needs like rent, utilities, health care and food. The American Journal of Public Health reported in 1998 that 10 million Americans -- including more than 4 million children -- do not have enough to eat.
What kind of Congress would cut taxes on the wealthy while letting millions of children go hungry in the richest nation on Earth?
Congress's tax cuts would widen the growing gap between the rich and everyone else, shred the remaining safety net and deepen the education, public works, research and other deficits that are undermining our future prosperity.
is co-author of the new book ``Shifting Fortunes: The Perils of the Growing American Wealth Gap'' and author of ``Chaos or Community? Seeking Solutions, Not Scapegoats for Bad Economics.'' Find out more about "Shifting Fortunes" right here.
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