In the mass of numbers that fill the budget President Reagan sent Congress on Monday, one statistic stands out--so much so that even the unemotional green-eyeshade people who work for budget director David Stockman put it in italics.
Overall, they said, the tax cut that the president cheered through Congress in the summer of 1981 has "reduced revenues as projected under current economic assumptions by more than one trillion dollars over 1984-88."
That is quite a sum. It amounts to about $1,000 a year for every man, woman and child in this country. Back in 1972, when George McGovern proposed writing everybody a $1,000 check every year--in lieu of the existing welfare programs--he was laughed out of town and trounced for the presidency. Reagan has done the equivalent of what McGovern only talked about-- and is kind of bragging about it.
But, of course, Reagan's benefaction was not shared out equally. The richer you are, the more you have gotten from what can accurately be called the most effective welfare program for the wealthy--the most deliberate effort to increase America's financial disparities and inequities--in a half-century of this country's history.
The Congressional Budget Office estimated that the original tax bill would save the $10,000 family $120 in 1983 but the $80,000 family a nice $15,250. I hope you enjoyed your share of the loot and what it has bought you.
But you might ask yourself what that money might have bought if the government had not abandoned its claim to collecting it.
Well, if Reagan had been as persuasive in holding down federal spending as he was in urging Congress to give up the money, the trillion dollars would have erased the total federal debt he inherited from Jimmy Carter and all the other presidents who preceded him. It would even have taken a big bite out of the $1.6 trillion debt we are looking at by the end of next year, when the bills are in on Reagan's latest budget proposal.
Think for a moment what it would mean for the federal government to be debt-free or, at least, well on the way to erasing its red ink. Think what that would do to bring down interest rates, revive housing and autos and send the stock market soaring. Then you can measure what you have paid, and will pay, for your share of the trillion-dollar giveback.
Another way of asking the question is to consider what could have been bought with that trillion dollars if some of it had been used by the government itself. A tiny fraction of that trillion dollars would eliminate the need for the government to try to shift $58 billion of health-care costs onto the backs of the ill, the aged and their families in the next five years, as Reagan is proposing. A tinier fraction would spare the child-nutrition programs from planned cuts--and the special- feeding programs for pregnant women and their infants.
The list could go on and on, but there is no need to belabor the point. The president himself acknowledged in an interview last week that there is "no way" to balance the budget, now or in the future, at the levels of taxation that were mandated by the 1981 tax law.
To hear him and Stockman tell it now, it was wretched excess on the part of Congress in that summer of 1981 that drove the tax base well below the target Reagan originally had set--20.6 percent of gross national product. It's a nice story, but it doesn't wash.
The charts in Reagan's own budget show the tax burden was barely higher than that level--just over 21 percent-- when he whipped up the great tax-cutting fever in 1981. A modest change in individual or corporate rates would have offset the scheduled increases in Social Security taxes and the effects of "bracket creep."
But Reagan in 1981 was not interested in modest changes of the kind advocated by Fritz Hollings, Jim Jones, Dan Rostenkowski and most of the other congressional Democrats.
You may recall that on July 27, 1981, when the alternative tax bills were ready for a vote, Reagan went on television and used those clever charts to ridicule the "so-called" tax cut that came out of the Ways and Means Committee and to point with pride at the "real" tax cut in what he called "our bipartisan bill"--the same bill he and Stockman now complain was excessive.
"The lines on these charts," he said, "say a lot about who is fighting for whom. On the one hand, you see a genuine and lasting commitment to the future of working Americans; on the other, just another empty promise."
Eighteen months later, the perspective is different. Faced with these staggering deficits, even Reagan has become a tax-raiser. But the damage has been done, and the steps he is recommending even now to repair it are woefully inadequate for the task at hand. Restoring the economy and rebuilding the tax base are the urgent needs of this country.