Friday, December 30, 2005

New taxes won't solve the real problem.

IACT, the Indiana Association of Cities and Towns, recently announced that its members could solve their financial problems if they were allowed to impose and raise more taxes. In the words of my slightly past teen-age son, "Well, Duh-uh". Couldn’t we all. Unfortunately, this is the same plan shared by politicians across the state and nation. The thought of reducing spending to ease the problem, while discussed occasionally, especially during campaigns, is never really honestly considered.

While Hoosier politicians play "pass the blame" with property taxes, food and beverage taxes, income taxes, the ever-popular local option income taxes, etc., the citizens of Indiana are left facing one glaring truth. There is only one place for any arm of the government to go for money, and the more money that government spends, the more money we as taxpayers will have to fork over. The latest round of property tax haggling between the state and local entities has produced forecasts by some lawmakers that those taxes will increase by 10% per year for the next three years. The main argument consists of who will collect the bounty and distribute the spoils. When you reach the point that you can no longer afford to pay the taxes on your home, will it really matter whether the state legislature or the county council sent you the bill?

When the federal budget was passed in Washington recently, the Republicans claimed a victory for fiscal conservatism, and the Democrats were upset that too many programs had been cut. Their reactions might make the casual observer think that spending had actually been reduced. (Our congressmen must have believed that too, because they felt so good about it they voted themselves a raise!) In reality, the only thing that was reduced was the rate of growth, and even then only by a minuscule amount. The Medicare prescription plan added more to the budget than all of the so-called reductions removed, and the federal budget, which has doubled in the last 15 years, continues to grow at a rate that will double it again in the next 10.

Politicians and economists will continue to argue about whether the actual federal debt is $5 trillion or $8 trillion, or $44 trillion as the Congressional Budget Office estimates, but the cold hard facts remain that working Americans will pay higher taxes in some form today, next year and 10 years from now as we pay $40 billion per month just for the interest on that debt. With the current attitude towards uncontrolled spending in congress today, the principle will not be addressed without, yes, you guessed it, raising taxes.

As taxpayers, we continue to bear the brunt of errant spending decisions from officials at all levels of government. From school boards spending millions on programs and buildings that have nothing to do with education, and city and county officials that use our tax dollars to provide special favors for special businesses. From state officials that spend millions on football stadiums for multi-millionaire team owners and players, and national officials that spend billions on bridges to nowhere in particular and breast enlargements for our soldiers. All funded by your ever increasing taxes.

Our current crop of politicians, top to bottom, have proven time and time again that they are either unable or unwilling to control their spending binges. Sooner or later, we are going to have to send in someone who can and will.



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