Mr. Giuliani's No-Tax Pledge
"IWOULD RULE out a tax increase for that purpose or for any other purpose. I think a tax increase would be very damaging to the American economy." That was former New York mayor Rudolph W. Giuliani genuflecting Wednesday to the anti-tax wing of his party at a meeting of the conservative Club for Growth. The subject was Social Security, and the question was whether Mr. Giuliani would rule out an increase in the payroll tax as part of a solvency fix. Mr. Giuliani's answer was disappointing. It's no more responsible for Republicans to rule out tax increases than it is for Democrats to insist on no benefit cuts.
Mr. Giuliani said he "would want to follow the example that Ronald Reagan followed in the sense of a bipartisan commission," but his answer reflected just the opposite of what Mr. Reagan actually did on Social Security. Mr. Reagan agreed to a fix that combined tax increases with benefit cuts. A rise in the payroll tax was speeded up, taxes on the self-employed were increased, and some Social Security benefits for higher-income retirees were taxed, while the retirement age was gradually increased from 65 to 67 and an increase in cost-of-living adjustments was delayed. In other words: just the kind of bipartisan blend that comments such as Mr. Giuliani's would preclude.
As it turns out, Mr. Giuliani gave a perfectly acceptable answer a few weeks ago, telling the Associated Press that he would appoint a bipartisan group to come up with recommendations on Social Security, maybe even before his inauguration. "I am opposed to tax increases, but I would look at whatever proposal they came up with and try to figure out how we can come up with a bipartisan way to do it," he said. The refusal to abjure any tax increase, at any time, amounts to heresy in some Republican circles. Club for Growth President Patrick J. Toomey, having rapped Mr. Giuliani's knuckles for those comments, pronounced himself "very pleased" with Mr. Giuliani's retreat. Mr. Giuliani has his eyes on the nomination, but if he were to win the White House, he would quickly come to regret remarks limiting the flexibility the next president will need on this issue.
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