In his Aug. 20 op-ed article, "Good Reasons for a Tax Cut," Robert M. Dunn Jr. offers a number of arguments for sizable federal tax cuts.
Mr. Dunn first notes that federal tax revenues as a percentage of GDP are at a peacetime high. But he fails to mention that the majority of the increase in revenues comes from capital gains and payroll taxes, not the individual income taxes that he advocates cutting.
In addition, assuming that Mr. Dunn does not favor a return to big deficits, the more relevant measure is that of federal spending as a percentage of GDP, which is at a 28-year low. The point is not that tax revenues are so high today but that they weren't high enough in the past to pay off our expenditures.
His second argument is that the middle class is paying more in income taxes than most people think. This is unsupported by the data. Last year the Treasury Department reported that a family of four making about $50,000 pays a smaller percentage of income in federal income tax than in any year since 1966. And the Congressional Budget Office estimated that middle-income families in 1999 paid federal income taxes of about 18.9 percent, a level lower than any year since 1983.
Mr. Dunn concludes with an oft-repeated Republican argument: Money from surpluses belongs to the taxpayer, not the government. In response, I would ask him to explain whose money the government spent while running up the tremendous deficits of the 1980s.
The correct use of any potential surplus is to pay off the $5.6 trillion debt. Reducing the debt would keep interest rates low, which in turn would benefit -- through lower mortgage and credit card payments -- most taxpayers more than any tax cut.
Considering Washington's continuing obsession with morality, how moral would it be to pass on our financial excesses to future generations without taking advantage of the opportunity to correct them when we have the chance?