President Obama made it clear he wasn’t going to be satisfied with the tax increase on upper income earners that he forced on Congress during the showdown over the fiscal cliff. Though in fact all wage earners suffered a loss this week as the payroll taxes surged, the president and his liberal supporters are determined to inflict even more pain on more people in any upcoming budget talks. However, one of the leading advocates for the president’s redistributionist position, the New York Times editorial page, is worried that in settling for a deal that raised taxes on those earning more than $400,000 a year, he has made it harder for the left to foist another job-killing tax increase on the country. So, to make this bitter pill easier for Americans to swallow, the Times claims that plans to confiscate more private income for government use is actually “reform.”
Leaving aside the fact that trying to squeeze more revenue for the government out of taxpayers won’t do much, if anything, to avert the budget crisis, the use of the word reform in this context is straight out of Orwell. Reform implies making the system fairer, which for some on the left is synonymous with soaking the rich. But a genuine reform of the system is one that will incentivize achievement, not penalizing it as well as making the labyrinthine code simpler and more understandable. But when liberals use this word it is merely code for policy driven by left-wing ideology and not pragmatism or the country’s economic health.
In the view of the Times, anything that creates a more progressive system in which more money is siphoned out of the private sector and into the hands of Washington is a form of reform no matter how convoluted the system might be. That’s a distraction from the country’s real problems that have everything to do with spending and little to do with not enough taxes. But it is also pure liberal cant rather than sensible economics.
But the Times is right on target in one respect. Having bulldozed Congress into the fiscal deal tax hike, the president and his followers are in no position to push for even more tax hikes. The payroll tax windfall for Uncle Sam also makes this argument difficult to sell to a skeptical public, let alone a Republican House of Representatives that is determined that it won’t be scammed in this manner again.
We can expect to hear more of this distorted argument in the coming weeks and months, but the main takeaway from this discussion ought to inform the way the upcoming debt ceiling fight is covered. Redistribution isn’t tax reform. It’s actually a way to avoid reform as well as irrelevant to the cause of preventing the country from sinking into bankruptcy. The Times editorial as well as the rhetoric coming out of the Democrats in recent days makes it apparent that instead of this confrontation being one between extremist Republicans and a sensible White House, the real ideologues in this argument are among the ranks of the president’s supporters.