Frank--Find%20the%20Taxes%20That%20Do%20Double%20Duty

Frank--Find%20the%20Taxes%20That%20Do%20Double%20Duty -...

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Reprints This copy is for your personal, noncommercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customers here or use the "Reprints" tool that appears next to any article. Visit www.nytreprints.com for samples and additional information. Order a reprint of this article now. February 18, 2011 Find the Taxes That Do Double Duty By ROBERT H. FRANK THE nonpartisan Congressional Budget Office projects a cumulative federal deficit of nearly $3.8 trillion over the next four years. So the $100 billion in annual spending cuts advocated by House Republicans will have a negligible impact on that total. More troubling, many of their proposals promise only to increase it. Nutritional support for low-income women and infants was cut by more than $1 billion, training and employment grants to states by $1.4 billion. Such programs exist not only to help people in need, but also to prevent costly problems down the road. Cutting them will make future deficits larger, not smaller. Clearly, reduced spending alone can’t solve our deficit problem. With baby-boomer retirements looming and the electorate unwilling to embrace large cuts in Social Security and Medicare , we must also raise additional revenue. The good news is that doing so will not require difficult sacrifices from anyone. But it will require a Congress that is willing to redesign tax policy from the ground up. Although Tea Partiers and others decry taxes of all kinds, many levies actually make the country richer, not poorer. The way forward lies in greater reliance on these kinds of taxes. A tax on any activity not only generates revenue, but also discourages the activity.
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This note was uploaded on 03/08/2011 for the course ECON 220 taught by Professor Cai during the Spring '08 term at Rutgers.

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Frank--Find%20the%20Taxes%20That%20Do%20Double%20Duty -...

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