A $21 Trillion Tax Cut

by James Ostrowski, Mises.org – 3/20/2001

President Bush has proposed a $1.6 trillion tax cut. I would like to suggest that the president modify his tax proposal. He should increase the size of his tax cut to $21 trillion.

Well, it’s not really a $21 trillion tax cut. It’s a $2.1 trillion tax cut. I got the $21 trillion figure by projecting it for ten years, just as Bush does with his. I don’t know why Washington projects these tax cuts for ten years, since federal budgets are only good for one year and can be changed any time thereafter.

But, you say, isn’t $2.1 trillion the entire federal budget for one year? Right you are. Let me explain my proposal, using fourth-grade math. [Note: If the following figures are off by a couple billion bucks, blame the OMB press office for not returning my phone call.]

The feds are going to extort $2,084 billion from us this year. But they are only going to spend $1,868 billion. If we eliminate all overpayments, you have a $216 billion tax cut. Now, let me give you back $210 billion more, which is what we pay in interest to those who were silly enough to lend money to the government. This has a side benefit of discouraging anyone from lending to the government again, as well as encouraging sound fiscal policy in the future.

Total tax cut so far—$426 billion.

Let’s do some more easy tax cuts. Let’s eliminate a bunch of departments we could do without. In the name of the Ninth and Tenth Amendments, I hereby abolish

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