Most people think of savings as that portion of a family’s income that they put away for emergencies, a big purchase, or their kids’ college education. It seems that some in the media want to change that definition.
The Hill ran an article equating tax increases with “savings” in terms of the budget deficit:
Senate Democrats claim they are close to agreement on a spending plan that would reduce borrowing by more than $4 trillion over the next decade, with about half the savings coming from higher taxes.
To review: Savings come from spending less, not taxing more. Higher taxes cannot be savings for the government, because the income wasn’t the government’s to begin with. The extra revenue that would come from those tax hikes belongs to the American families and businesses that earned it. The government cannot “save” it by taxing it away from those who earned it.
Politicians, the media, and other commentators exhibit this troubling way of thinking far too often when discussing the federal budget. For example, it comes up often when they refer to the “cost” of tax cuts. Just like tax hikes can’t be savings for the government, tax cuts can’t cost the government anything because the money was never the government’s to begin with. Or, more accurately, it is only the government’s money once it has been extracted from the taxpayer.
President Obama, his allies in Congress, and other backers of an ever-expanding federal government welcome this dangerous redefining of simple words like budgetary “savings,” “tax costs,” and “mandatory spending.” Such misrepresentations make it easier for them to raise taxes to fund their big government programs.
After all, if our income belongs to the government in the first place, it is hard to object to government keeping more.
It is important that taxpayers remember that tax hikes are not necessary to lower the deficit to sustainable levels. Tax receipts will rebound once the economy picks up in the next few years and surpass their historical norm of around 18.5 percent of our economy by 2017. If Congress restrains spending to its customary level of 20 percent of our economy or less, then deficits will fall to sustainable levels without raising taxes a dime. We show in great detail how to do this in The Heritage Foundation’s new, comprehensive Saving the American Dream plan.
Getting spending under control, strengthening the economy, and holding the line on taxes will truly be savings to already beleaguered American taxpayers.
