Cutting Taxes

CONGRESSIONAL Republicans are struggling to pass a tax cut the economy doesn't need and taxpayers are not clamoring for. With President Clinton also proposing a $250-billion targeted cut, it's clear these proposals are nothing more than the candy politicians love to pass out before elections.The assumption underlying these proposals is that the federal government will realize a $3 trillion surplus over the next decade. While the economy has been performing extremely well for the past nine years, it is presumptuous to assume that the current recovery will last another 10 years.

WHO IS the real John G. Gary? The hot-headed loudmouth who picks fights with school superintendents and Circuit Court judges, or the practical government executive who supports some of the most innovative welfare reform programs in the state, if not the nation?In the next five weeks, Mr. Gary will have to redefine himself for Anne Arundel County voters if he wants a second term.Without referring to polling data, I'd be willing to bet that Mr. Gary's negatives are rising.After battling for five months over the education budget, many county residents identify Mr. Gary as a combative bully who eschews negotiation, rather than as an able manager who has maintained county services even as tax revenues have been frozen in place.

During a furiously paced campaign sweep through the state last week, Gov. Parris N. Glendening found himself ready to shake yet another hand at a new adult day care center in Cambridge.Staring back at him from a wheelchair was Doris J. Horney, 75, who thanked him, with tears in her eyes, for the state's help in making Pleasant Day Medical Adult Day Care a reality."We pay taxes all our lives, and then you get something like this building, something worthwhile," Horney said.Glendening seemed genuinely touched, but just as clearly pleased.

ELLEN R. Sauerbrey will be elected governor Nov. 3 because she is the best candidate, has run the best campaign and will make the best governor.She is a person of fundamental decency and integrity. Everyone who has worked with her, including politicians from both parties, acknowledges that when Ms. Sauerbrey gives you her word, you can take it to the bank. She does not switch gears every time the political winds change.By contrast, Parris N. Glendening is known as a person whose word cannot be trusted.

IN YOUR March 1 editorial, you warn that we should "go slow on cutting taxes." The reason we have a tax surplus is that we are overtaxed in the "Great Society" state of Maryland.Your worry that tax revenues might fall flat or decline is typical of your paper's Democratic tax-and-spend philosophy.If tax revenues decline, our legislators will have to do what every business or household does when cash flow is strained: cut spending. Not all government "programs" are vital to the well-being of Maryland citizens.

TAXES, taxes, taxes. Who should pay how much and in what manner? It's an age-old question that forever is being debated. Taxes are inherent in civilized society, as prominent observers noted centuries ago."In this world, nothing is certain but death and taxes," Benjamin Franklin said in 1789, although novelist Daniel Defoe had said it some 50 years earlier.But who should pay taxes? Russell Long, who headed the U.S. Senate's tax-writing committee when he was a senator from Louisiana, explained the pressures on him from various constituencies: "Don't tax you, don't tax me, tax that fellow behind the tree."

In the tough years of the early 1990s, the states raised taxes that hit the poor harder than the affluent. Now that the booming economy has made the states flush with money, they are cutting taxes -- for the affluent.Sales and excise taxes, which fall more heavily on people at low income levels, were raised $11.7 billion from 1990 through 1993, data from the National Conference of State Legislatures show. These taxes have been cut by $200 million, or less than 2 percent of the amount of the increase, since 1994.

HAPPY ANNIVERSARY! The long Wall Street bull market began 14 years ago this week -- Aug. 12, 1982 -- with the Dow Jones industrial average at 776.92 (that's no misprint.)This morning, with the Dow index perched at 5,647.28, the blue-chip indicator stands 4,870.36 points -- 626 percent -- above its level of 14 years ago.Speaking of stocks, here are excerpts from Fortune's Aug. 19 "Future of Retirement" cover story:"Maximize 401(k) contributions -- and after that, sock some more into an IRA. Invest aggressively; your nest egg may need to last another 20 years or more."

WASHINGTON -- Ever since the Republicans won control of Congress last Nov. 8, the party's leaders have been proclaiming the result as a mandate for their "Contract with America."The fact that several polls have indicated that most voters had never heard of it at the time they cast their ballots has not inhibited House Speaker Newt Gingrich from making that claim.Now comes further evidence, in a New York Times/CBS News poll of 1,190 adults, that for all the publicity the contract has received since Nov. 8, most say they still don't know anything about it.Furthermore, a majority of Americans in the poll say they disagree with some basic tenets of the contract, and are more concerned about problems that are not its major features.

House Speaker Casper R. Taylor Jr., eager to prove that Maryland Democrats heard the message of voters in November, said yesterday that the General Assembly should consider cutting taxes this year.The Allegany County Democrat said that he was not pushing any particular proposal but that he was convinced that most Marylanders believe their tax burden is too high and thinks the legislature should respond to that complaint.He said the plan of legislative leaders and Gov.-elect Parris N. Glendening to limit the increase in state spending next year to 4.5 percent, combined with an improving economy, could create a surplus of $250 million or more.

Hemorrhaging jobs - 5.6 million in a year - gets one focused on how we can stop this carnage. I was part of a blitz of 350 U.S. factory owners and managers who spent two days last week meeting with members of Congress to share with them some ideas on how we can reverse this trend and get back to growing manufacturing jobs in the United States. The U.S. manufacturing industry is still the biggest in the world; we want to keep it that way. Despite common misperception, our manufacturers ship more than China.

It's easy to look like a hero when you walk through the door, say corporate crisis managers. But then it hits you: You have to run the dump. It's worse than you thought. You can't blame the previous CEO forever. The turnaround manager named Barack Obama is getting his reality check even before he gets the keys. Since August, U.S. employers have shed 524,000 jobs, the government reported yesterday. That's the worst two-month loss since right after the 2001 terrorist attacks. Before that, you have to go back to the 1982 recession to find a poorer performance.

Tired of the claims about cutting taxes I've read in these pages for a couple of weeks now, Howard County Republicans complain about the fact that the Democrats are now looking for ways to cut taxes. Frankly, I'm tired of it, and it's time to put some of this stuff to rest. It is claimed that if Democrats had been serious about cutting taxes, they should have passed Gail Bates' "Aging in Place" bill. Unfortunately, Ms. Bates' bill wasn't about true "aging in place." What it said was, "If you are a Howard County homeowner, and you are a certain age, you get a property tax cut."

CHICAGO - At the age of 50, I get few chances to try something entirely new. Come Nov. 2, I plan to take one of those rare opportunities. I'm going to vote for a Democrat for president. I've never done it before, and I hope I never have to do it again. But George W. Bush has made an irresistible case against his own re-election. His first term has been one of the most dismal and costly failures of any presidency. His second promises to be even worse. John Kerry is not an inspiring candidate.

States and counties cutting taxes to boost job growth are likely undermining their own efforts, an economist argues in a new book - the latest salvo in a battle over the impact of taxes on economic development. Robert G. Lynch, author of the study and chairman of the economics department at Washington College in Chestertown, said he found little proof that tax breaks and incentives create jobs or encourage businesses to move from one state to another. The study was released today by the Economic Policy Institute in Washington, which focuses on the interests of low- and middle-income workers.

HE'S NOT going to raise your taxes, but he might do something creative with the automobile registration fee. Like doubling or tripling it, or whatever. If a tax increase is in his cards at all, it'll be a smallish one at the gas pump. With a transportation trust fund deficit reaching several hundred million dollars, these options or a combination of the two are on the Ehrlich administration's table. The goal would be to raise $300 million. A 10 cent increase in the gas tax would do that.

ANOTHER PRESIDENT BUSH. Another mushrooming budget deficit. Another clamor from Democrats for an economic summit that would provide bipartisan cover for a deal to raise taxes -- or least forgo tax cuts that have not yet taken effect. At the former summer White House in Maine, fallout from the latest estimates of the widening gap between federal income and outgo must be invoking terrible memories of the 1990 economic summit. The resulting bargain took the first crucial step toward reversing three decades of red ink. But it cost George H.W. Bush his presidency.

TODAY'S COLUMN is about corporate income taxes -- but wait! Don't go away! We're serving bagels and coffee, and anyone who reads this column will be eligible for an all-expenses-paid trip to the Cayman Islands with your choice of escorts -- Jennifer Lopez, The Rock, robbed-of-gold Olympic figure skater Jamie Sale or Czech hockey hunk Jaromir Jagr. OK, I made up the part about the bagels. And J-Lo never got back to me. But look, I only make these empty promises because I'm like you -- when someone mentions corporate income taxes, a crust forms on my eyes.

ELLWOOD CITY, Pa. - George Lias was just standing behind the counter of his paint shop, unprepared for the out-of-nowhere question: Does he like President Bush's $1.6 trillion tax-cut proposal? Shifting his thinking from paint to politics, he seemed at first to warm to the idea of tax relief: "They should give it back instead of keep it. Politicians have a tendency to keep it." But after a moment of collecting his thoughts, he added that "paying the national debt and helping the elderly with their fuel bills" should be much higher priorities than cutting taxes.

CONGRESSIONAL Republicans are struggling to pass a tax cut the economy doesn't need and taxpayers are not clamoring for. With President Clinton also proposing a $250-billion targeted cut, it's clear these proposals are nothing more than the candy politicians love to pass out before elections.The assumption underlying these proposals is that the federal government will realize a $3 trillion surplus over the next decade. While the economy has been performing extremely well for the past nine years, it is presumptuous to assume that the current recovery will last another 10 years.