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 enator
Ted Kennedy is arguably the biggest spending politician in the history
of the United States. There may be no member of Congress in either
party whose spending initiatives are more responsible for our $4
trillion national debt than Ted Kennedy. For more than 30 years,
Kennedy has been a major driving force in Congress for expansions
in Medicare and Medicaid, food stamps, and public housing, and hundreds
of other pricey federal programs that have caused a quadrupling
in the size of the budget since Ted's father bought him a seat in
the United States Senate. He cosponsored this year's dreadful education
bill that will nearly double the federal education budget over the
next five years.
The National Taxpayers Union has given Kennedy a lifetime "F"
grade for his disservice to the taxpayers and his utter disregard
for fiscal sanity.
So there is
more than a little irony in Ted Kennedy now giving holier-than-thou
lectures about fiscal responsibility. What's next, Arthur Andersen
CEO Joseph Berardino preaching about business ethics?
Kennedy blasted
the Bush tax cut from last May, blaming tax relief for the recession,
the disappearing surplus, rising interest rates, higher unemployment,
and just about the breakdown of Western civilization. But here's
a short list of the logical inconsistencies in Kennedy' anti-tax-cut
screed:
Kennedy blames
a tax cut — 75% of which has not even taken effect yet, for
an economic downturn that began at least six months before the tax
plan was even passed into law.
Kennedy says
that tax cuts are causing higher interest rates when interest rates
have fallen, not risen during the Bush presidency.
Kennedy says
that the tax cut is responsible for the $150 billion reduction in
the surplus in 2001, but the only tax cut that has taken effect
so far has been the $40 billion tax rebate, which was the Democrats'
own idea. Tax-rate cuts can't possibly have caused the shrinkage
of the deficit because tax rates haven't been cut yet. (You have
to wait till 2005 or so for those cuts.)
Kennedy manages
to slither to the left of his Majority Leader Tom Daschle by calling
for one of the largest tax increases in American history. Kennedy
would raise income-tax rates on the rich; he would resurrect the
death tax; and even tax rates on many middle-income families would
be raised in Kennedy's $1 trillion tax-hike scheme.
What we have
here is Kennedy-economics. But it is certainly not John F. Kennedy
economics. It was almost exactly 40 years ago when President Kennedy
called for a 30% across the board income-tax-rate cut. JFK argued
that high tax rates were one of the primary deterrents to prosperity.
He believed that without tax cuts, "it is a paradoxical truth
we will never reach our industrial potential to balanced the budget."
He said that every American should receive a tax rate reduction,
because "a rising tide of prosperity will lift all boats."
There was none of this class warfare, hate-the-rich rhetoric that
has become such an unhealthy obsession with his younger brother,
Tom Daschle and the modern-day Democratic party.
In fact, JFK's
tax cut was a much larger tax cut for the rich than Bush's. JFK
cut the top income-tax rate from 91% to 70%. Bush only cuts the
top tax rate from 40% to 35%. JFK understood what his little brother
can't comprehend: that when the rich face lower tax rates, they
will save, invest, work, and hire more.
Ted Kennedy's
speech on the evils of tax cuts, is not so much an indictment of
the economic policies of Bush as it is the economic policies of
his brother.
Kennedy has
also introduced a new and baffling economic theory unknown and unarticulated
until today. According to this Kennedy theory, the way to get out
of a recession is to raise taxes on Americans so that families can
spend less, and the government can spend more. This new theory is
inconsistent with classical economics, supply-side economics, and
even Keynesian economics. Kennedy seems to be making the nonsensical
argument that if we increase the tax penalties on investment, business
expansion, and job creation, we will get more investment, business
expansion, and job creation.
Kennedy's prescription
for more economic recovery is not new, nor is it fiscally responsible.
It is boilerplate liberalism: more government spending. On top of
the 11% increase in government spending already approved by Congress
for 2002, Kennedy seeks at least $50 billion more federal domestic
expenditures for 2002. Apparently, Kennedy and his economic wise
men are unaware of the catastrophic failure of these tax-and-spend
policies in Japan.
The reassuring
news for tax-cutting Republicans is that they not only have economics
on their side; they have politics on their side too. The latest
CNN poll shows that by a 2-to-1 margin, voters oppose the Kennedy
idea of terminating the Bush tax cut.
Kennedy and
Daschle continue to push the Democratic party further and further
to the loony left — away from the center ground that the Clinton
New Democrats of the 1990s successfully captured for their party.
The first rule of politics is that when your enemy is busy digging
himself into a ditch, let him keep digging.
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