Wednesday, February 08, 2006

Cost to Whom?

This week, President Bush sent Congress a $2.77 trillion budget plan. CNN reported on Monday that the plan "would also make his first-term tax cuts permanent, at a cost of $1.4 trillion over 10 years, and still achieve his goal of cutting the deficit in half by 2009." (Emphasis added)

The "cost" is that some taxpayers get to keep a little bit more of their money over the next decade. It does not mean that Americans have lost $1.4 trillion by 2016. Instead, that money will have been spent on goods and services that people value. It will be invested in companies, used to generate wealth and develop new technologies. Just because the money is not in the hands of bureaucrats does not mean it has disappeared.

The real cost to taxpayers is the $2.77 trillion dollars that the government spends. Regardless of whether we see any of the benefits from government programs, we are forced to bear the cost of politicians' spending whims. There's no way to 'opt out' of these programs, even if we can fully demonstrate that we are not the recipients of the benefits the programs offer. I can't say "Mr. President, I am not going to pay for your 'No Child Left Behind' initiative. I obtain no benefit from the program. I have no children, and if someday I do, I will use my own money to educate them."

According to the article, "Democrats attacked what they said were Bush's skewed priorities. They said he was trying to impose austere budgets that will harm programs for the poor while protecting tax cuts Democrats said were going primarily to the wealthy." Certainly there are some people who are better off as a result of government programs which take money from others and distribute it (in various forms) to those who did not earn it themselves. Does this mean that Democrats have a valid claim that cutting programs that helped the poor is a costs poor people? It is no more valid than if I claim that if my parents last year gave me a $100 gift certificate and this year gave me a $75 gift certificate, it has cost me $25.

Before we start labeling costs, we'd better ask ourselves one simple question: cost to whom?

No comments: