A Government Cut Is a Taxpayer Keep

by | Apr 11, 2015 | Taxation

When Obama castigates spending cuts he is really criticizing your just demand to keep what you earn. So don't feel so bad.

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Say a group of criminals shakes down local merchants every week.  One week, the merchants bravely ask the leader of the gang to take a little less.  The criminal scoffs.  “Don’t you realize,” the criminal says, “if we steal less from you, it will mean I have to lay off one of my crew, and we will each have to drink one less shot of whiskey per night.  That’s not fair to us.” Of course, such a response on the part of the criminals is preposterous.  It is not their money to begin with so how could they interpret the proposed cut as an injustice?

Yet, this is exactly the position of the Obama administration with respect to the sequester cuts in 2013.  According to them, if the mandated budget cuts go through, a vast injustice will be committed upon the poor souls in Washington D.C., and fire and brimstone will pour down upon the nation as the mad run riot in the post-sequester apocalypse.

But does the sequester actually cut anything?

In his post, Earth to New York Times: Please Show Us these “Deep Spending Cuts” You Keep Writing About, blogger Dan Mitchell shows that the budget cuts mandated by the so-called sequester are actually not cuts at all.  In fact, based on CBO projections, these cuts merely impede the increase in growth of government spending – by a tiny amount.  In other words, these “savage” cuts are just a tiny cut in the rate of increase, not even an actual cut!  Senator Rand Paul has called out the Obama administration on its “doom mongering” and “histrionics” over these supposed cuts and introduced his own bill to cut the amount of mandated spending without any layoffs.

But let’s say these were real cuts and let’s assume that, gasp, actual federal bureaucrats got laid off as a result of said cuts.  As was the case in the criminal example, when the government spends money, it is spending someone else’s money.  The government ultimately can only fund itself through taxation, that is, through the expropriation of one person’s earnings for the unearned benefit of another.  In what sense is it a “cut” when all this means is that the government will stop stealing a little bit of money for awhile and pissing it down the federal government budget toilet?  For this reason, a “cut” should be thought of and referred to as a taxpayer “gain” or to be more accurate a taxpayer “keep.”

Remember, when Obama castigates spending cuts he is really criticizing your just demand to keep what you earn. So don’t feel so bad.

1 Comment

  1. The analogy with the criminal racket is exactly what the left in Sweden says with respect to tax cuts. At present, those who do home repairs can deduct a portion of their expenditures from their income taxes. The Left claims that the Swedish tax office is thus subsidising homeowners to improve their homes at the expense of those who depend on welfare programmes. Some nerve! Whose money is it anyway??!

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Doug Reich blogs at the The Rational Capitalist with commentary, analysis, and links upholding reason, individualism, and capitalism.

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