From: egl1@cunixf.cc.columbia.edu (Elizabeth G. Levy)
Subject: Re: DC Myth # 302 : A tax increase will lower the deficit
Keywords: taxes, deficit, lower
Reply-To: egl1@cunixf.cc.columbia.edu (Elizabeth G. Levy)
Organization: Columbia University
Date: Thu, 28 Jan 1993 18:14:36 GMT

In article <C1JuCC.Csy@news.cso.uiuc.edu> kkopp@uxh.cso.uiuc.edu (koppenhoefer kyle cramm) writes:
>thf2@ellis.uchicago.edu (Ted Frank) writes:
>>In article <C1JI84.7Cu@news.cso.uiuc.edu> kkopp@uxh.cso.uiuc.edu (koppenhoefer kyle cramm) writes:
>>>  Why do people inside the beltway still believe a tax increase will lower
>>>the deficit?  The following numbers would dispute this:
>>>
>>>         Year             Federal Taxes per person
>>>
>>>        1983                    $2,490
>>>     
>>>        1993                    $4,438     ( projected )
>>>
>>>( from a Tax Foundation report , Sept 1992 )
>>>
>>>   Of course, while the tax burden nearly doubled, the deficit spireled 
>>>through the roof.  
>
>>Gee, you didn't happen to mention that inflation nearly doubled also in the
>>same time period, did you?  Naaaah.  
>
>Do you have inflation numbers ( I don't, and that's why I didn't post them)?
>If you actually have some, then maybe we can make a comparision.            
>

Arguably, one should be aware of such a criticism and have the
inflation numbers handy in case of challenges.  In any case:

From _The World Almanac 1993_:

With 1982-1984 as a base, CPI for June 1992 is 140.2.  The exact
numbers are:

1983	3.2
1984	4.3
1985	3.6
1986	1.9
1987	3.6
1988	4.1
1989	4.8
1990	5.4
1991	4.2

In any case, about half your tax increases are accounted for by
inflation.

I'm also curious how your tax figures are computed.  I recall a NYT
article on our tax burden a month or two ago that noted our tax
burden, as a percentage of population, hasn't really changed since
1981 or so.  The distribution has, regressively.

Punching some numbers from the Almanac into my calculator, (namely,
Distribution of Total Personal Income, on page 136), I get, for
"personal taxes" divided by a population estimate:

Year	Pop		Tax Revenue	Tax/Pop
	(millions)	(billions)

1991	250		616.1		2464.4

1983	230		410.5		1784.8

These are in nominal terms, so the tax increase is approximately
accounted for by inflation.  What were the components of "Federal
Taxes per Person"?

>>>[ no need to flame Reagan/Bush, they tried to decrease 
>>>spending, but Congress wouldn't do it ] 
>
>>Why do you pose such a canard?  Bush asked for *more* spending than 
>>Congress actually approved on *every* *single* *budget*.  
>
> You know that the presidential budget is a wish list!  Besides, when 
>it came to crunch time Reagan made a deal with congress that tax increases 
>would be accompanied by spending cuts so as to keep the deficit down.  
>Obviously only the tax increases survived!  

Well, Congress is to blame, just as much as the GOP administrations.
Congress has followed the Reagan/Bush budget proposals in general, and
have even returned budgets with smaller deficits at least half the
time.  If you want a balanced budget, get the President to propose one.

Also, look in David Stockman's _The Triumph of Politics_.  Stockman
was Reagan's first OMB chief, and he blanched at the numbers the
Administration gave him to work with.  Big deficits because Reagan's
people insisted on massive defense expenditures without either cutting
spending elsewhere or raising taxes.


--
	Who's "the loneliest monk?"