Ex­cess in­come: Obama’s and his gov­ern­ment’s

The Washington Times Weekly - - Commentary -

It is be­com­ing a ver­bal tic, the ten­dency on the part of the pres­i­dent to tell wealthy Amer­i­cans (“peo­ple like me” he’s al­ways care­ful to add) that they have made more than enough money and will have to cough up more of it for the gov­ern­ment. Speak­ing for him­self on July 11, the pres­i­dent of­fered that he had “hun­dreds of thou­sands of dol­lars that I don’t need.”

The pres­i­dent is of course wel­come to do­nate as much of his ex­tra money as he likes to the fed­eral trea­sury. He knows Ti­mothy Gei­th­ner per­son­ally and can prob­a­bly get a guar­an­tee that his check will be cashed with­out de­lay. And since the pres­i­dent is so ready to im­pute un­pleas­ant mo­tives (like greed) to those who op­pose tax in­creases, per­haps we should im­pute some sort of moral fail­ing to him for not hav­ing thus far con­trib­uted his spare change to the gov­ern­ment.

I can think of many ex­cel­lent rea­sons to op­pose higher taxes that have noth­ing to do with greed.

The gov­ern­ment is a spigot. Just when you think that spend­ing has passed some sort of gasp-in­duc­ing peak, it blows right past it. Some of us thought the half-tril­lion-dol­lar deficit at the end of the Bush ad­min­is­tra­tion was ver­tigo-in­duc­ing. In just the past two years, Pres­i­dent Obama and the Democrats have tripled the deficit and added $3 tril­lion to the na­tional debt. This added spend­ing, 40 per­cent of which was bor­rowed, was ad­ver­tised as re­quired to cre­ate thou­sands of jobs, kick start an eco­nomic re­cov­ery, pro­mote “green” en­ergy, “save” thou­sands of jobs that would other­wise have dis­ap­peared and pro­vide long-term un­em­ploy­ment in­surance for those out of work.

The stim­u­lus bill suc­ceeded only in the last goal. (Slo­gan sug­ges­tion to the Repub­li­can 2012 pres­i­den­tial can­di­date: “If you want an un­em­ploy­ment check, vote for Obama. If you want a job, vote for ___.”)

The pres­i­dent may be per­fectly con­fi­dent that the best use of his ex­cess cash is to pay more taxes. Those who live in the real world may con­sider the gov­ern­ment hope­lessly waste­ful and in­ef­fi­cient.

If the pres­i­dent re­ally wants to get the most bang for his char­ity buck, he’d be far bet­ter ad­vised to do­nate to the Boys and Girls Clubs of Amer­ica or the Wounded War­riors Fund than to the IRS.

Even the spend­ing Democrats con­sider their great­est achieve­ment, Medi­care, is grossly wasted. Writ­ing in the Weekly Stan­dard, Jef­frey An­der­son re­cently sum­ma­rized his Pa­cific Re­search In­sti­tute study on the costs of Medi­care and Med­i­caid. It’s a fa­mil­iar Demo­cratic re­frain that gov­ern­ment spend­ing keeps in­creas­ing be­cause it is at­tempt­ing to keep pace with ris­ing health care costs. But that may be back­ward. As An­der­son shows, the costs of these two flag­ship fed­eral health pro­grams have grown much faster than other health care costs in Amer­ica.

Since 1970, “health costs apart from Medi­care and Med­i­caid have grown 41 per­cent per pa­tient in re­la­tion to GDP,

Ev­ery time the pres­i­dent de­mands higher taxes, he is re­sist­ing re­form that could transform our gov­ern­ment, our econ­omy and our fis­cal predica­ment.

while Medi­care’s and Med­i­caid’s costs have grown 89 per­cent and 91 per­cent, nearly dou­bling, as a share of GDP.” An­der­son men­tions one rea­son for the dis­par­ity: “In Medi­care, if providers get it right the first time, they get paid once. If it takes them four or five times, at se­niors’ in­con­ve­nience and some­times at their peril, they get paid four or five times as much.”

Fur­ther, as Mer­rill Matthews and Mark Li­tow ar­gue in The Wall Street Jour­nal, Medi­care en­cour­ages waste­ful be­hav­ior. Among sim­i­larly sit­u­ated pa­tients, Medi­care uti­liza­tion is 50 per­cent higher than pri­vate in­surance cov­er­age. “When peo­ple are in­su­lated from the cost of a de­sir­able prod­uct . . . they use more.” And then there is fraud, which ac­cord­ing to GAO es­ti­mates, cost tax­pay­ers more than $70 bil­lion in 2010 alone.

Ev­ery time the pres­i­dent de­mands higher taxes, he is re­sist­ing re­form that could transform our gov­ern­ment, our econ­omy and our fis­cal predica­ment.

Even the fac­ulty club set from whom he takes ad­vice must re­al­ize by now that with­out sub­stan­tial new growth, the United States is in real trou­ble. The pres­i­dent him­self agreed in 2009 that “you don’t raise taxes in a re­ces­sion.”

We are not tech­ni­cally in a re­ces­sion. But we are in the kind of slug­gish econ­omy that the heavy boot of gov­ern­ment cre­ates. Re­sis­tance to tax hikes is short­hand for “no to all that.”

Mona Charen is a na­tion­ally syn­di­cated colum­nist.

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