By: Jack Burgess
(this is from an article posted in the Chillicothe Gazette)
That’s right, the debt ceiling is an artificial problem—a self-inflicted wound. Most countries don’t have a debt ceiling. Neither did we before World War I, when conservatives in Congress put a limit on the national debt. Since then it’s been raised many times, including 17 times under President Reagan, the ultimate conservative Republican. National debt only becomes a problem when one political party wants to scare voters, to stop the other party’s programs, or make a President look bad. Like Speaker McCarthy and Sen. McConnell want to make President Biden look bad.
Actually, a lot of the debt came from the Trump administration, when the Republicans-cut taxes by $1.5 trillion, while the government was giving away money to help us—and the economy–cope with the Covid crisis. The Trump tax cut of 2017 cut corporate taxes from 35 to 21%, the largest corporate tax cut in US history. President Trump promised the cut would trickle down to workers, with “around a $4,000 pay raise.” So the Communications Workers of America sued several large corporations for a $4,000 raise, but it didn’t happen.
Wait, you say. Don’t all budgets have a limit? Even a rich family has to pay its bills. But the US is not a family. A family has a life cycle — a “sunset,” if you will. But our nation doesn’t. Uncle Sam doesn’t retire, or earn less in later years. The US is increasing in value every year. And the United States is the richest country in the world, based on our natural resources, great location and climates, and a great workforce.
Our taxes have barely tapped the wealth of the nation. Taxes on wealth are very low. Some super moguls, who stash their wealth abroad, for instance, pay no taxes at all. Working-class Americans pay nearly a quarter of their wealth in taxes every year, but the richest 25 people pay around 3.4%. Billionaires don’t have to cheat on their taxes to whittle them down to that level — it’s all legal.
Back in the Eisenhower years of the ‘50’s—and he was a Republican—the tax rate was 90% on top tier earnings. Today it’s around 28%.
Actually, the 14th Amendment to the US Constitution says, “The validity of the public debt…shall not be questioned.” Legal scholars have argued the President could ignore the debt limit, but who knows how our current Supreme Court would view that. Meanwhile, President Biden and Speaker McCarthy are negotiating.
Republicans want work requirements for government assistance, but not all recipients can work. Many are children. And the impact of millions of low-wage workers into the economy would put a downward pressure on wages. Democrats oppose that. Most Republicans seem to think it would be a good idea, advocating the notorious “trickle down” idea that when the rich get more money they typically share it. That idea was the driver in Reagan’s conservative economic policies—which resulted in the most increase in the national debt ever in peacetime. And recession.
So, what happens if President Biden and the Republicans don’t reach a deal before the June 1 deadline? No one knows for sure, but the Treasury Department could pay only some of the bills — like Social Security benefits, federal workers’ wages, and Medicare and Medicaid — or make reduced payments overall — or delay payments until an agreement is reached. Or close the national parks.
Whatever happens, it’s a big deal, especially for government employees, who don’t make a lot of money, or folks with only Social Security to live on.
So let’s remember who’s responsible for the problem—conservative politicians that want to cut government services and cut taxes mostly to benefit their wealthy contributors, so they’ve set up this unnecessary hurdle for the nation to jump. Let’s hope voters remember in November.
Jack Burgess is a retired teacher of American & Global Studies, who also served as Chief of Arbitration Services for the State of Ohio.