THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Saturday, April 8, 1995 TAG: 9504080239
SECTION: LOCAL PAGE: B1 EDITION: FINAL
TYPE: Column
SOURCE: Guy Friddell
LENGTH: Medium: 59 lines
At last a caller to a talk show has said something sensible. And the caller's views are similar to those advanced by some of the country's leading economists.
About 10 o'clock Thursday night on the Tom Leykis Show on WNIS Radio the caller advised that we forgo the GOP's proposed tax cuts.
Had there been a car phone within reach, I'd have urged that we junk President Clinton's tax-cut plan along with Newt Gingrich's ``crown jewel.'' The difference that makes Clinton's preferable is that it costs a sixth of the GOP version.
With the deficit towering above the nation, a gigantic disaster moving in on us like a tornado on a trailer park, it is simply obscene of Congress to offer a whopping reduction in taxes.
The caller said he was a Republican who'd voted for the GOP in November. Recently, he said, he'd earned a lot of money - ``made a better mousetrap'' - yet the tax cut would give him $500 for his daughter.
He'd rather forfeit the tax cut, he said, and save his child from a legacy of debt that imposes a crushing burden on the country.
Here and there, from town halls, focus groups, and various polls, opposition is rising to the notion of any tax cut.
In Wednesday's Washington Post, business writer Steven Pearlstein reported that ``economists generally deride it. . .''
He quotes a former Reagan official, William A. Niskonen of the conservative Cato Institute, as saying: ``There's not a single part of this bill that I consider an improvement over the current system.''
His fear is that the tax changes would encourage more business investment in new equipment but not stimulate additional saving to finance it and wind up increasing the already large amount of money that the United States is forced to borrow abroad.
``It's a tax bill defined by ideologists and political tacticians, not by businesses or economists,'' said Robert Shapiro, vice president of the centrist Progressive Policy Institute.
He doubts that Congress will find the $90 billion in annual spending cuts that will be necessary to pay for the tax cuts by the year 2005 when the full effect of the tax provisions kicks in.
Among others with qualms, Harvard's Dale Jorgensen said, ``A number of things in this bill go in the right direction, but economically the whole thing just doesn't hang together.''
Pearlstein noted that in surveys, business executives have generally put tax cuts below regulatory reform, legal reform, and balancing the budget on their list of priorities.
The Republicans' push for a tax cut mocks their advocacy of a balanced budget amendment. Clinton, who backed away earlier from a tax cut, should denounce the Republican offer as a political ploy and renounce his counter proposal in what has become a bidding war to national bankruptcy. by CNB