Marketplace commentary September 24, 2003
The President is asking Congress for an additional $87 billion in emergency spending for Iraq. But where will the money come from? Next year's budget is already almost $500 billion in the hole.
The simplest and most obvious place to get the money: Postpone next year's tax cut for the richest 1 percent of Americans, those earning more than half a million dollars a year. That would generate about $87 billion right there, the whole extra cost of the war.
Again and again in wartime, America has imposed a war tax on the very wealthy. The estate tax, which overwhelmingly hits wealthy families, began under wartimeRepublican president Abraham Lincoln and was resumed by Republican wartime president William McKinley. And it was maintained from World War I all the way up through the end of the Cold War. Now, of course, the estate tax is being phased out.
During World War I, the income tax rate on the wealthiest rose to 77 percent, and during World War II it rose to more than 90 percent, and stayed there. In 1953, with the Cold War raging, Republican president Dwight Eisenhower refused to reduce it on the richest Americans. By 1980, the top rate was still up there, at 70 percent. Now the top rate is 38.6 percent, and it's heading downward.
Even though the White House has no plan to pay for the extra costs of invading,occupying, and rebuilding Iraq, it's busy shifting the tax burden away from therich. The President says this will stimulate the economy. But the rich won't spend the extra cash. They already spend as much as they want. They're more likely to invest it wherever around the world they can get the highest return.
Look, I'm not even saying raise taxes on the rich. Just keep the tax rate whereit is. This alone would give us enough to pay the extra costs.
It's only fair. Most Americans are still imperiled by recession -- their wages going nowhere and their jobs precarious. Someone's got to pay for the extra costs, and it might as well be the only people in America who can afford to.
This isn't about class warfare, folks. It's about real patriotism during a time of war.
