A Wartime Budget: Will Americans be called to sacrifice?
By Congressman Adam Schiff
Published in the Pasadena Star News, January 22, 2003
NEXT week the President will deliver his State of the Union address, setting
out the challenges facing America in the war on terrorism and his plans for our economic recovery.
This address, before the assembled members of the House and Senate, Supreme
Court justices and cabinet officers, is watched around the world by friend and foe alike. Filled
with pomp and ceremony, it can set the nation's agenda for a year or a generation. The speaker's
platform is the granddaddy of all bully pulpits.
From my seat in the middle rear of the chamber, I will be listening for one
word in particular sacrifice.
The word "sacrifice' should be a natural for a State of the Union address given
at a time when the nation is at war, when we are confronted with the need to defend against new and
varied threats to our security - everything from small pox to shoulder-launched missiles that can
shoot down commercial aircraft.
Our men and women in uniform are certainly making sacrifices. Tens of thousands
have been called up, leaving their jobs, their families, often on very short notice and at great
financial and personal cost. But what about the average American who is not on active duty or in
the reserves? How will we be called upon to make our own contribution to the security and prosperity
of the United States?
The centerpiece of the Administrations new agenda - and president's likely
State of the Union speech is a $674 billion dollar tax cut, weighted heavily toward America's
wealthiest families. Can this be the sacrifice we will be called upon to make, with our most
prosperous families being asked to make the largest sacrifice - by suffering their taxes to be
cut the most? In every other conflict since the civil war, the commander-in-chief has called for
an increase in revenues to meet the national defense. Is this war different? Can we have more
butter, more guns, and no sacrifice?
Apparently not. Senate appropriators just cut $8 billion for increased security
at ports, cut $362 million for border security, cut $500 million for police and fire departments
who will be first on the scene of any terrorist disaster, cut $534 million from job training,
and cut $1 billion from our schools - underfunding the president's own education initiative.
The president's proposal also does nothing to alleviate the states' own budget crises, and their
correspondingly massive cuts health care, education and welfare.
Ending the double taxation of dividends might be good tax policy in a vacuum,
taking some of the vast fluctuations out of the market. Coupled with reforms that end the no
taxation of other corporate earnings, the provision could be revenue neutral. But the
administration's proposal is not coupled with other reforms, and at a cost of $364 billion is
far from revenue neutral. Because the plan would have little effect on current spending and is
permanent, it would also do little to boost our sagging economy while doing a lot to increase
our long-term national debt.
But more important, the president's proposal is not made in a vacuum. We
have so much work to be done to protect the homeland, and we still suffer the lingering effects
of a recession. We have lost almost two million jobs in the last two years and cannot afford tax
cuts that will neither stimulate the economy nor help those most in need. Many of us that
supported tax cuts when we were at peace and enjoying historic surpluses will vigorously oppose
them now that we are at war and in debt.
As the president's own economic advisors will be the first to admit, small
business is the driving force for growth and the government's ability to positively affect the
economy through fiscal policy is limited.
Probably the most significant contribution the federal government made to the
prosperity of the 1990s was the difficult decision to balance the budget and keep interest rates
low. But now we are back to the days of deficits as far as the eye can see, and where have the
fiscal conservatives gone? White House Budget Director Mitch Daniels can say only that the new
red ink is nothing to hyperventilate about. Two other words to listen for in the State of the
Union will be "deficit' and "debt.'
Americans are a proud and generous people who are more than willing to sacrifice
in a worthy cause. If instead we are to give ourselves a gift no other war generation has given
themselves, we will denude our ability to defend the homeland, or at best, shift to our children
the responsibility to pay for our economic health and safety.
And so I will be listening for our president to call on the American people -
each of us - to do our part to provide for the common defense.
Rep. Adam B. Schiff, D-Pasadena, is a member of the House Judiciary Committee
and its subcommittee on Crime, Terrorism and Homeland Security.
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