During the run-up to the tax cuts (givaways) of 2001 and 2003, one of the tactics employed by the Bush Administration and Republican congressmen was to add in sunset clauses that would cause many provisions of the tax cuts to expire in the next few years. This kept official estimates of the budgetary impact of said tax cuts to a level where they would pass. However, it was naive for anyone to expect that these provisions would actually be allowed to expire, as many of them related to child tax credits, marriage tax credits and Alternative Minimum Tax relief. The time has come for the predictions about making permanent the tax cuts. In the 2005 budget under debate in the House and Senate, there are provisions to, you guessed it, make the tax cuts permanent. This shows the deliberate tactic of misleading the public as to the true long-term effects of the tax cuts on the U.S. fiscal situation. In a Center on Budget and Policy Priorities (CBPP) report from May 18, 2004, using estimates from the Congressional Budget Office (CBO) and the Urban Institute-Brookings Institution Tax Policy Center, they estimate that making the tax cuts permanent would cost $601 billion over the next ten years. Given the fact that we have, using the most conservative CBO estimates, the prospects of $2 trillion of deficits over the next ten years and will by the end of 2004 have a debt of $4.3 trillion, we cannot afford to maintain, let alone extend the tax cuts of 2001 and 2003.

Furthermore, as the CBPP report notes, the tax cut extensions do not address the most important tax policy issues over the next ten years, especially to the middle class: the expanding number of people who, due to problems with the Alternative Minimum Tax, will see their tax bills increase greatly without a corresponding increase in their income. This is alarming, particularly given how great a boon the tax cuts were to the very, very wealthy. So much for shared sacrifice in a time of war.

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©2004 Richard B. Goud, Jr.
Updated on 21 May 2004 at 14:28 PST