To the extent that this fundamental principle is honored, current voters would face the correct incentives in terms of approving federal investment yielding future benefits. It is clear both that the Reagan defense policy played an important role in the collapse of the Soviet empire and that the absence of the Soviet Union represents a huge asset for future generations. Ask instead whether the services that they will receive will be worth the future taxes that they will have to pay to retire the debt left to them. But an explicit increase in current taxation to pay for these programs would not be feasible politically, precisely because they are not worth their costs to current voters. That is what it means to say that Social Security, for example, offers a low rate of return to young workers.
Government exists to serve the people, who always have first claim on their own taxpayer dollars.
That view is quite contrary to the implicit belief of the permanent government class, which is that once revenues are sent to Washington, the list of rationales available to avoid returning them to the taxpayers is infinite. During the 1990s, taxes supposedly could not be cut because of the budget deficit, while now they cannot be cut because of the budget surplus. Reagan had the insight to ask whether the taxpayers are getting their money's worth and whether substantially higher tax payments have yielded more and better federal services. Those questions answer themselves, and that is why taxes should be cut. Benjamin Zycher Is an Adjunct Fellow at the Claremont Institute.