Reducing the Deficit: Raise Taxes on the Poor

I have been following with interest the current debate on letting the tax cuts expire.  President Obama has encouraged new legislation that would allow the tax cuts to continue for only the middle class while resuming the old higher tax rates for families making more than $250,000.   The Republicans and some Democrats in Congress would prefer to continue the lower tax rates for everyone, including the very wealthy.  They argue that we should not raise taxes during the severe economic downturn that the country is enduring.

The same conservatives also argue that the budget deficit is much too high and should be lowered immediately.  They propose that we cut national spending.  However, they do not want to cut defense, medicare, social security, or payments on the national debt.  Nor are they prepared to stop pork barrel spending in their own districts or states.  A reasonable person might get the sense that their position is an untenable one.

Don’t despair.  A practical solution is at hand.  We must increase taxes on the poor immediately to save the country from economic disaster.  I propose an immediate tax of 35% on welfare payments, food stamps, Section 8 subsidized housing, and Medicaid benefits.  My plan has several advantages:

1. There are far more poor people than very rich people, so that the tax increases will be spread among a larger number of people, thus avoiding penalizing the comparatively small number of rich people.

2. It is more equitable to raise tax rates on poor people to the same rate that rich people pay.  After all, they are receiving benefits funded by the taxes of the more well-to-do.

3. The lobbyists and interests groups for the poor are far less powerful than the lobbyists for the wealthy.  As a practical matter, it would be much easier to raise taxes on the poor than on the rich.

The economic health of our great nation is at stake.  Hopefully, the new Congress will quickly implement this practical solution to our economic woes.