By By Matthew G. Binanz

The House and the Senate recently both passed tax-related bills. The odd thing is the Senate was praised as being more fiscally conservative for only proposing a $50 billion tax cut compared to the $95 billion tax cut of the House. Since when did a tax cut larger than the net worth of the richest man in the world qualify one as a fiscal conservative? Further, as the third or fourth round of tax cuts under the Bush administration, one must ask if such a measure is prudent or necessary.

Each year the U.S. government spends between $2 and $2.5 trillion on everything from Social Security to the Army to the National Parks. Since the Bush administration has taken office the government has spent about $2.5 trillion a year, while only collecting taxes in the $2 trillion range. This is a problem, as eventually someone will have to pay the difference. Right now this difference is being pushed off on future generations under the theory that the U.S. economy will grow fast enough that inflation will make the amount of debt smaller. This works, so long as the national debt is kept at a constant level. The problem is the debt is not being kept at its current level. It’s growing, and its rate of increase is growing as well. The latest tax cuts are not part of some larger shift of monetary policy or a temporary discrepancy caused by a change in the tax system, but rather a seemingly annual event where the government cuts the taxes and keeps the voters happy.

One must ask then: when is it a good time to cut taxes? The answer is simple, when you have a net surplus and when you need economic recovery. Right now the U.S. government is about $7 trillion away from a net surplus-so that can’t be the reason. The question then is whether the United States needs economic recovery right now. The obvious answer is no. The stock market is up, corporate profits are at all time highs and the amount of people without jobs is holding steady. Yes, oil prices are higher, but that hasn’t destabalized the economy. Further, much of the tax cuts relate to dividend income, which actually increases with higher oil prices. This means the proposed tax cuts make it more profitable for oil companies to raise gas prices.

A second major component of the tax plan in Congress is the changes to the Alternative Minimum Tax. The AMT will quickly increase the taxes many Americans pay. The problem is in reducing the AMT, Congress has not reapportioned the tax burden to make up the difference. Further, the people affected by dividend tax cuts and the AMT are not your average Americans. The average American household’s income is $44,389. The AMT doesn’t usually kick in until a person’s before tax income reaches $100,000 or taxable income reaches $60,000. Further, dividends are only earned on stocks. There are 91 million Americans who own some sort of stock, but only 23 million own individual stocks outside of a retirement account. In a nation of 300 million, where 40 million Americans have inadequate health coverage, tens of millions of dollars of college aid is being reduced and thousands of Americans are homeless, it seems odd to be giving money to people who are already rich enough to invest on their own. I know Christ said he would reward those who used their gifts for good, but he also commanded that those who are rich help those who are not rich.

That is why America must re-embrace a more progressive tax system. This is not to say I support a socialized form of government, but rather that the government should put the priority of balancing its own accounts and planning for the future over the enriching of currently rich individuals. Taxes are annoying and no one enjoys paying them, but we all must share the financial burden of the government’s services. Putting those payments off to tomorrow to reward the rich of today is plainly wrong. This latest tax cut serves no higher economic purpose and is solely an exercise in vote buying. If Michael Bloomberg spent $106 per vote in his mayoral campaign, the Congress just spent $166-$316 per vote to buy votes and should be justly rewarded by being voted out of office.