EDITORIAL: Tax cuts hinder funding for poor

Editorial Board

Two years ago the United States was reaping the benefits of a $5.6 trillion budget surplus. A surplus that contained possible funding solutions to our nation’s schools, many beset by crippled infrastructure and underpaid teachers. A surplus that could help provide healthcare to the poor and elderly, ensuring the survival of Medicare, Medicaid and Social Security.

Instead of funding vital social service programs, though, President Bush issued a refund check to taxpayers across America, providing a small, pleasant addition to household budgets but doing nothing to address critical infrastructure problems that only government, not individuals, can solve.

Now we face a $2.1 trillion deficit for the next 10-year period, a $304 billion deficit for the next year alone. Bush blames the deficits on recession and war, but still proposes an “economic stimulus” package that would make his tax cuts of 2001 permanent and eliminate the taxation of stock dividends. Altogether, these tax cuts add up to $1.3 trillion over the next decade, in addition to the $1.35 trillion tax reduction passed in 2001. Bush said that eliminating the taxation of stock dividends will put $20 billion into the economy. That is small potatoes, though, when compared to the amount of money the government will lose.

Deficit-laden states are feeling the money pinch. In a recent meeting of the National Governors Association at the White House, the governors agreed on a statement asking the federal government to pay more for the cost of federal mandates in education, Medicaid and domestic security. Bush told them the federal government did not have the capability to help, and restated his support for tax cuts to stimulate the economy.

State governors were told that under a proposed plan, they would no longer have to match federal funds for Medicaid, the federal-state program for 45 million low-income people. Under the administration’s proposal, states would still have to cover most welfare recipients and poor children, but would receive new power to change or eliminate benefits for other recipients, including many who are elderly or disabled. The governors worried aloud that the proposal could eventually cap the federal contribution to state Medicaid.

Even Bush’s own programs, like the No Child Left Behind Act, are being reduced. After-school learning programs have lost more than 41 percent of their funding; initiatives to improve teacher quality have been cut by $173 million. And his budget includes no money for a possible war on Iraq.

Fiscal irresponsibility should not be the hallmark of a truly compassionate conservative. Nobody wants an oversized bureaucracy, but Bush’s budget has slashed and burned its way through education, Medicaid and homeland security, only to give tax cuts to the rich, spindly checks to average Americans and half of new government spending to the defense department. Editorial Board: Cavan Reagan, Amber Billings, Ayrel Clark, Charlie Weaver, Katie List