BY W. JAMES ANTLE III | FEBRUARY 27, 2013
The tax man is coming for the middle class
There’s debt denial and debt denial denial, but there is one wave of liberal truth-telling sweeping the land. We are increasingly hearing admissions that paying for the promises the federal government has made will require higher taxes on everyone, not just the rich.
Exactly a month after President Barack Obama was re-elected by promising that only the super-wealthy would have to pay more, Howard Dean let the cat out of the bag. The former Vermont governor, presidential candidate, and Democratic National Committee chairman confessed he had “mixed feelings about striking a deal where the rich folks pay more taxes.”
“This is, initially, gonna seem like heresy from a progressive,” Dean said in an interview with MSNBC. “The truth is, everybody needs to pay more taxes, not just the rich. That’s a good start, but we’re not gonna get out of this deficit problem unless we raise taxes across the board.”
The old screamer repeated this “heresy” in an interview with the pollster Scott Rasmussen over the weekend. “This is the fundamental problem in American politics and it’s the fundamental problem with democracy in general,” Dean said. “Somebody has to tell the Middle Class that either your taxes are going to go up or your programs are going to get cut or else we’re going to go into financial oblivion, and nobody really wants to tell them that.”
Cue Walter Mondale at the 1984 Democratic National Convention. “Mr. Reagan will raise taxes and so will I,” Mondale said en route to a 49-state landslide defeat. “He won’t tell you. I just did.”
In fact, Mondale came within fewer than one vote per precinct of losing all 50 states. That’s a pretty good indication of why Democratic politicians no longer talk like that, including Dean himself when he ran for president.
But liberals who don’t need votes from the American people are still allowed to do math. To pay for the social programs they want, they will ultimately need more tax revenue from the middle class as well as high earners.
Speaking at the Sixth & I Historic Synagogue in Washington, D.C., earlier this month, the economist and New York Times columnist Paul Krugman also uttered this inconvenient truth.
“The year 2025, the year 2030, something is going to have to give. … We’re going to need more revenue. … Surely it will require some sort of middle class taxes as well,” he said.
Krugman averred we “won’t be able to pay for the kind of government the society will want without some increase in taxes,” possibly including a value-added tax, and “decisions about health care,” which is a nice way of saying rationing.
Krugman concluded: “So the snarky version … which I shouldn’t even say because it will get me in trouble is death panels and sales taxes is how we do this.”
This is actually not a new revelation from Krugman, or even a new line. He said the exact same thing in 2010.
Since the 1980s, the two parties have had a tacit agreement. We get the Republicans’ tax rates in exchange for the Democrats’ spending programs. There were some upward adjustments of the top rates under George H.W. Bush and Bill Clinton in the early ’90s and in the fiscal cliff deal at the end of last year, but this has basically held. The price has been chronic deficits.
Now those deficits are becoming unsustainable and the major entitlement programs will soon be in the red. Republicans made the first move toward admitting that spending will have to be reined in to keep relatively low taxes when they more or less embraced Paul Ryan’s budget plan. Now Democrats are starting to drop some hints on taxes too, such as when the White House celebrated the presumed death of the anti-tax increase pledge.
In his recent interview with Rasmussen, Dean told another truth. “People don’t like government spending, but they don’t want to cut anything because they like all the programs government spending buys them,” he said.
This is generally true. But in an age of 401(k)’s and other private investment accounts, will the middle class really want to pay higher taxes for slightly higher benefits? Is spending restraint — even when it involves real cuts — so undesirable a future compared to “death panels and sales taxes?”
The plain fact is that big government has actually limited the political options available to the American people, leaving them with only unpleasant options. But at least we can be honest that the bill is about to come due.
W. James Antle III is the editor of The Daily Caller News Foundation and author of the forthcoming book “Devouring Freedom: Can Big Government Ever Be Stopped?“