The bogus White House 'tax cut' plan

By Vin Suprynowicz
web posted January 10, 2000

It's part of the enduring charm of gonzo journalist Hunter S. Thompson that, to this day, no one is quite sure whether he was serious when he proposed in 1972 that Democrat George McGovern's campaign slogan should be "Acid, Amnesty, and Abortion."

But it's hard to argue the Dakota Democrat could have fared much worse, had he followed the Rolling Stone correspondent's advice to let the true Democratic agenda "all hang out."

Robotic incumbent Richard Nixon was not exactly an easy fellow to warm up to. The war in Vietnam had already cost one incumbent president his office, and was still draining the nation's youth like a hospital IV tube plugged into wall suction. And then there was that little dust-up at the Watergate.

Sen. McGovern, on the other hand, had established a reputation as a decent and dignified fellow. He'd even honorably flown a full rotation of combat missions over Germany in 1944, while Lt. J.G. (later Lt. Cmdr.) Nixon was piling up his political grubstake, cleaning out the Pacific theater's rear-echelon guys in those legendary poker games.

Why, then, did George McGovern and the Democratic ticket garner only an ignominious 17 electoral votes, to Richard Nixon's 520?

For the same reason Bill Clinton had to work so arduously 20 years later to position himself as a "new Democrat" of the "centrist" sort, of course. Americans haven't voted for a presidential candidate or national platform that reeked of socialism and the cradle-to-grave nanny state -- "liberalism," as it's now called in polite society -- since 1964.

And George McGovern's 1972 platform was so socialist it actually called for a "reverse income tax."

Of course, subsequent Democratic congresses actually enacted such a scheme -- it's now euphemistically dubbed the "Earned Income Tax Credit" -- just as Washington's incumbent party has been surreptitiously enacting, piecemeal, the "Hillarycare" nationalized health scheme, so widely ridiculed by appalled voters when publicly rolled out in 1994.

The lesson, apparently, is that Americans will tolerate any amount of creeping collectivism so long as you hide it behind the curtain and call it by another name.

Which brings us to the so-called "tax cut" proposals which White House spokesmen say Mr. Clinton will re-issue in his final State of the Union address, Jan. 27.

A naive observer might be surprised to learn Mr. Clinton plans to call for a "tax cut," so soon after he vetoed last summer's modest $792 billion GOP tax cut plan -- inadequate in itself, but still real tax relief for a broad range of taxpayers, eliminating the so-called marriage penalty and estate taxes, while reducing levies on capital gains (secondary taxes on successful investments made with after-tax income.)

Wasn't it Mr. Clinton who famously said "We could give the money back" to the American taxpayers, but then "You might not use it for the right things"?

The answer to this conundrum, of course, is that Mr. Clinton, like Lewis Carroll's Humpty Dumpty, believes that "When I use a word, it means just what I choose it to mean."

In fact, the president's new "tax cuts" will again involve a call for such "tightly targeted" schemes as his "Universal Savings Accounts" -- $250 billion in excess taxes collected from productive citizens over the next decade, and then handed over to "poor" Americans in the form of "tax credits" worth up to $300 per year.

(Gosh, three hundred bucks. Only $4,700 short of most investment funds' "minimum buy-in." We're in the money, we're in the money ...)

In addition, Clinton chief economic advisor Gene Sperling said recently the administration is "working on health care tax incentives that would go beyond what was proposed in last year's package."

Last year's stillborn proposal included a plan to give $1,000 "tax credits" to help people with disabilities or lasting illness pay for long-term care; and $1,000 "tax credits" to make it easier for people with disabilities to return to work by paying for their transportation and job-related expenses.

The big question, of course, is how such "tax credits" can possibly help those who today pay little or no federal income tax in the first place -- as is the case with most of the disabled and the truly poor.

Would such folks qualify for "refunds" -- government cash handouts -- if the application of such "tax credits" ended up showing their "tax obligation" as a negative number?

To offer such a new income-transfer scheme as a "tax cut," when it would involve higher tax collections from those who actually pay taxes, "reducing" the taxes only of those who pay hardly any taxes in the first place, is different from Mr. McGovern's rejected 1972 socialist "reverse income tax" scheme in only one important regard:

Sen. McGovern was honest enough to call a spade a spade -- and to pay the political consequences for his honesty.

Which is one problem the current White House obviously needn't worry about.

Vin Suprynowicz is assistant editorial page editor of the Las Vegas Review-Journal. His new book, "Send in the Waco Killers: Essays on the Freedom Movement, 1993-1998," is available at $24.95 postpaid by dialing 1-800-244-2224; or via web site

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