Twisted Tax Logic: Whatever the Government Doesn’t Tax, It “Spends”

Pete Kasperowicz of the Washington Examiner has an illuminating article that highlights the Newspeak that surrounds the taxation and spending policy among the Democrats in Washington. In “Dems cave, agree to massive federal spending cuts”, Kasperowicz reports on Rep. Gwen Moore (D, Wisconsin) at a House Budget Committee hearing, in which she spoke of a need to cut spending in the form of tax hikes.

Yes, really. Here’s how the skewed logic works:

The root of the argument is the feudal Democratic theory that says all things belong to the upper government nobility, and these things only reach the hands of the vassals when the ruling class wants that to happen. It the modern world, it means any money the government never bothered to take before was a gift, one that can be reclaimed at any time.

In their view, tax policy is viewed not in terms of how much the government should take from the earnings of its populace. Instead, it’s how much the government decides not to collect out of the population’s earnings. As Rep. Moore was quoted in the article:

“The tax breaks that we all voted for on Nov. 15 is spending, people,” she told the hearing. “It’s spending. You can say we’re putting monies back into our constituents pockets, whatever you want to say. It’s spending.”

Having established that a forbearance to take by taxation equals “spending”, a “spending cut” takes place when less amount is allowed to leak from the government to the population, I.e., tax hikes:

“Where is the greatest opportunity to cut spending?” she asked at the hearing, chastising Republicans for daring to cut things like the federal Women, Infants and Children program. “I mean, is there more money in, like, Head Start, WIC, than there is in these tax expenditures?”

For Moore, “tax expenditures” is precisely the federal program to cut.

Here is a bare bones explanation of how the income tax portion of the federal tax code works: gross income minus deductions equals taxable income; tax equals the rates imposed on taxable income, minus credits. To put it in concrete terms: if you earn $100 of income, it is subject to a possible tax. However, if you give $30 to a charity, the Internal Revenue Code allows a deduction, such that only $70 would be subject to the income tax. You still have to earn the $100 and give the $30 to charity in order to get the discount on tax. The statement by Rep. Moore would have it that the government had a right to confiscate all $100, and that by relenting and issuing a tax on $70, allowing you to keep the $70 (minus the tax) is as if the government earned all of the money and was gracious enough to give some of it back to you.

This logic imputes a government confiscation of earnings that were we ever required to be confronted with the full ramifications of it, would be highly unconstitutional. As it is, it’s just cheap rhetoric to get to an end result of justifying higher taxes.

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