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“Read My Lips: Don’t Cut Taxes!”

© Glenn Hameroff

The American public is being hoodwinked on the issues involving the Deficit and the proposed tax cuts that are being discussed during this campaign season. The Deficit and the National Debt are two distinct measuring tools that are related, but not the same. When the President says that we have eliminated the deficit, he is discussing a single year's budget. During this single year the government has either collected an amount of revenue equal to what it spends or as in the case of a surplus-has collected more than it spends. When the President projects a surplus of 1.7 trillion dollars over the next decade he is talking about the Deficit.

The National Debt is the total accumulated borrowing of the United States government. It is approaching 6 trillion dollars and growing. Reckless government spending and unwise tax cuts can accelerate the growth of the National Debt. This 6 trillion dollar figure includes the accumulated Social Security surpluses because for many years the government has been borrowing the Social Security surplus by demanding that the Trust Funds invest in government bonds. These bonds place a debt obligation on the federal government. While we have been experiencing surplus budgets the National Debt has continued to grow. The government does not collect its tax revenue in an even flow so that it is forced to borrow money for operating expenses. You might recall those infamous government shutdowns. They were actually caused by the President and Congresses' inability to reach a compromise on raising the ceiling (borrowing limit) on the National Debt.{Our Crushing National Debt- http://home.europa.com/~blugene/deficit/... }

While economists have differing opinions on that impact of the National Debt on our economic well being, there is no doubt that an expanding National Debt imposes an increasing obligation on our children and grandchildren. As the size of the debt increases the portion of our current budget allocated to paying the carrying charges on the debt increases. When I was in High School debt maintenance consumed 3 cents out of every dollar of government spending. Today that figure is over 15 cents of current expenditures budgeted for debt expenses. If present trends continue will 25 cents of our children's tax dollars go to pay for our borrowing?{Grandfather Economic Report on the National Debt- http://home.att.net/~mwhodges/debt.htm}

I would use the real surpluses, reported surplus minus Social Security surplus, to pay down the debt. By actually retiring government bonds, we will be providing our posterity with more income and fewer heart wrenching decisions regarding such items as medical care for the elderly. If we allow the debt to grow our future taxpayers will be caught between the proverbial rock and a hard place. They will have to make the painful budget cuts that we did not have the courage to undertake and they may be tempted to "monetarize the debt"(print more money) thus stoking the engines of hyperinflation.{U.S. Debt Clock- http://www.toptips.com/debtclock.html }

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