Sunday, December 13, 2009

What Happens When Congress Gets In A Hurry

There has been a lot of rushing around in Congress lately, as if there is no time to evaluate what laws are being passed.

The economic stimulus bill was rushed through as an absolute necessity. $787 billion was allocated for spending and agreed to in just a few days. And yet, the results are just the opposite of what was expected – unemployment continues to rise far beyond what we were told it would be if we would support the stimulus package. There have been no firm connections made between the stimulus bill and an economic turnaround. Things have become decidedly worse in our economy.

Now, healthcare is being rushed through Congress, even though such a bill has far-reaching and long-lasting effects. Revamping healthcare could have serious consequences – life and death consequences – if not properly done. And yet, thousands of pages are being written, Congress is voting on it without reading it, and our leaders are breaking their promises to allow it to be posted on-line for 72 hours before taking a vote. We are rushing toward something – but what?

The most recent penalty for a hurried attitude came recently when the Internal Revenue Service announced that they had erred in the release of the tax tables in 2009 – a result of President Obama’s signature tax credit offered as part of the stimulus package. The credits were designed to give individuals as much as $400 in “money back” and couples as much as $800. Because of an oversight, the tax tables for many couples were posted incorrectly, allowing them to claim more credit on their 2008 return than they were allowed. It is estimated that as many as 15 million people will now owe the government $250 or more – some as much as $400. Most of those affected are working couples, but the error also spills over onto single students and Social Security recipients (another error in which the government overlooked the possibility that someone might claim a new Social Security bonus and the above-mentioned tax credit – they are eligible for only one of these credits). Affected people in any category will have to make the correction, either through more tax liability for 2009, or in a reduced return. One thing is for sure – the government will get “its money”, even if they were the ones who made the error.

It feels to me that we are rushing to our own economic destruction. The tax credit was given to Americans with the instructions to “spend the refund in order to stimulate the economy”. How long can that tactic work? Is such a design sustainable? Isn’t there another route we can take – namely, to require the government to spend less, resulting in a lower tax burden, and allowing each individual to keep more of their own money to invest and use as they see fit? Imagine the economic strength of a nation where everyone was free from the worry of debt, and could concentrate on superior products and innovative ideas.

What is lost in nearly every news article that I read is that the tax money started out as ours. We work hard for our paychecks and we make many decisions about how to spend and save. And yet, the assumption made by so many is that the government has a right to take it from us at their whim. True – per the Sixteenth Amendment to the Constitution, Congress can collect taxes at will. What may have been forgotten is that before 1913, they did not have the right to collect taxes from our incomes (see a previous article here). They continue to abuse this law, taking more and more of our money to fund their own unread and poorly crafted laws. And we continue to send them cash with every pay stub.

I came across this interesting quote recently, from Herbert Hoover:

“Every collectivist revolution rides in on a Trojan horse of 'emergency'. It was the tactic of Lenin, Hitler, and Mussolini. ... And 'emergency' became the justification of the subsequent steps. This technique of creating emergency is the greatest achievement that demagoguery attains.”
The “emergency” has certainly been declared again, and we are falling for it just as surely as economic ruin awaits us if we continue on this course. What should we do? It’s time to get involved – write a Congressman, elect leaders who understand this principle, or work to repeal the Sixteenth Amendment. Without our income tax to spend, Congress just might get downsized. Would that be a bad thing?

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