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April 02, 2004,
8:26 a.m.
The Fiscally Promiscuous Candidate
John Kerry has proposed $2.76 trillion in new spending. Ouch.
John Kerry believes that we need a smaller and smarter government that wastes less money … John Kerry will reduce the size of the Federal government. — Kerry for President website
One of the great things about being a candidate for the presidency is that you can promise everything to everyone with few bothering to tabulate the costs. Fortunately, a few people have been tallying Sen. Kerry’s many campaign promises. If he keeps even a fraction them, the size of the federal government will do anything but shrink.
According to the non-partisan National Taxpayers Union, as of March 8 Kerry has proposed a whopping $2.76 trillion in new spending over the next 10 years.
While Kerry has developed a bit of a reputation for trying to be on both sides of every issue (recall his justification for voting against the $87 billion to support our troops in Iraq: “I actually did vote for the $87 billion before I voted against it.”), this is ridiculous.
Some taxpayers may wonder what they’re getting for their $2.7 trillion. Below is a brief example of how President Kerry would spend your tax dollars. (Figures are for over 10 years.)
$35 billion in free tuition for students who agree to participate in something called a “National Service Plan” after graduating.
$17.5 billion in expanded unemployment benefits. (One wonders why this is necessary since Kerry has promised to virtually eliminate unemployment.)
$57.5 billion more for Head Start.
$10 billion to the auto industry for the development of “energy-efficient” vehicles.
While such profligate spending might strike some as extreme, this is nothing new for Sen. Kerry. A close examination of his career in the Senate reveals a long history of fiscal promiscuity.
Citizens Against Government Waste describes Kerry as “hostile to taxpayers,” giving him a score of 13 percent for 2003, and a lifetime score of just 25 percent. Meanwhile, NTU has given Kerry an “F” in its “Rating of Congress” for every year but one since it began the ratings in 1992. NTU also calculated that Kerry voted to approve $218 billion in new spending and proposed $45.2 billion in new spending in the 107th Congress alone.
One wonders how Kerry would reduce the size of government when he has proposed, and voted for, so much new spending. Then again, in a world in which Kerry implies his vote against the first Gulf War was actually a sign he supported the war, and his vote for the most recent Gulf War demonstrated his opposition to it, maybe he believes you can make the federal government smaller by voting for massive increases in spending.
Kerry implies he will pay for all of this new spending by repealing President Bush’s “tax cuts for the rich.” Unfortunately, under even the best circumstances, this massive tax increase won’t come close to paying for all his proposed spending — raising perhaps $700 billion over 10 years and leaving a $2 trillion deficit gap. In fact, the Washington Post recently reported that “Kerry's aides privately admit the Democratic candidate cannot fulfill all of his campaign promises and still reduce the deficit by half as promised.”
However, even that estimate is generous. Tax increases rarely raise as much revenue as predicted because of their negative effects on the economy. A tax hike equals slower economic growth which equals less revenue flowing into Washington.
For instance, one of Senator Kerry’s proposed tax hikes would increase the top personal income-tax rate. Kerry hopes Americans will back this tax hike as an effort to soak the rich. Unfortunately, the top wage earners in this country are those who invest their earnings in America’s economy, helping it grow and creating jobs and wealth. When Uncle Sam picks pockets, Americans don’t invest as much, the economy typically slows, and fewer jobs are created.
Further magnifying this mistaken policy is the fact that the majority of small businesses in America do not pay corporate taxes, but rather personal income taxes. This means the Senator’s plan to soak the rich is actually a massive tax increase on small businesses. Even the most fervent proponents of wealth distribution must realize the disastrous effects this would have on the economy.
Finally, one might point out that the federal government is already doing a pretty good job at soaking the rich. According to IRS data, the top 1 percent of wage earners in America pay 34 percent of all income taxes, while the top 5 percent pay 53 percent. The bottom 50 percent of wage earners pay a mere 4 percent of total income taxes. Someone needs to inform Sen. Kerry that it is unwise to kill the goose that lays the golden egg.
So, while listening to Kerry campaign for the presidency over the next several months, remember that if something sounds too good to be true, it probably is.
— Cesar Conda, former assistant for domestic policy under Vice President Dick Cheney, is a board director at Empower America. Eric V. Schlecht is a writer living in Arlington, Va., who has worked on tax, budget, and economic policy issues in both Congress and the private sector.