Give Numbers, Name Names on Tax Cuts

GOP front-runner George W. Bush reportedly will announce a tax plan within the next few weeks. It is said that the plan will include some reduction in tax rates, phasing-out of the estate tax and other staples of Republican tax policy. It will, no doubt, be praised by the usual people who have never seen a tax cut they didn’t like.

The real question is whether the Bush plan is going to attract any voters to him that he isn’t going to get anyway.

As someone who has been pushing tax cuts since the 1970s, I certainly applaud any political candidate’s support for an issue I hold dear. Yet I cannot deny that those who think like me represent a declining fraction of the electorate.

Back in the tax revolt days of Proposition 13 in California, voters seemed to want their taxes cut to the exclusion of everything else. Today, that simply isn’t the case.

Indeed, even among the wealthy, who now pay a majority of all federal income taxes, tax-cutting appears to be a low priority. This is a puzzle because federal taxes as a share of the gross domestic product are the highest in U.S. history, 21.9% of GDP.

Despite this fact, however, poll after poll shows that tax cuts rank well below debt reduction, saving Social Security, improving education and strengthening Medicare among voters’ priorities.

High taxes still are the main concern of a significant number of Americans, but they seldom rise above third or fourth on the list of priorities and are dwarfed by the combined percentage of those with other concerns.

President Clinton would have us believe that Americans have simply been won over to his vision of activist government and now reject the small-government philosophy of most Republicans.

Yet overwhelming percentages of Americans still believe that their taxes are too high, and specific tax cuts are very popular.

However, there is a deep distrust for politicians who promise tax cuts. One poll that stands out is from Fox News/Opinion Dynamics in March. Registered voters were asked if they believe politicians when they promise lower tax rates. A staggering 87% said no; only 9% said yes.

Another factor that stands out is hostility to “targeted” tax cuts. That word is equated in most voters’ minds with: “Someone else will get their taxes cut, but not me.”

Yet at the same time, voters say they support every specific tax cut they are asked about. Large majorities favor expanding individual retirement accounts, cutting the capital gains tax, eliminating the marriage penalty and abolishing the estate tax. A large majority also support radical tax reform, such as adopting a flat rate tax system.

So how do we reconcile these contradictory opinions, and what will it mean for candidate Bush?

My interpretation is that voters feel they have been burned by vague tax promises that were broken. Bush’s father, unfortunately, is a major culprit, with his famous “read my lips” pledge that was broken two years later. Clinton also is guilty, having promised a middle-class tax cut in 1992 that turned into a tax increase the following year.

On the other hand, politicians like Virginia Gov. Jim Gilmore, who promise very specific tax cuts, such as abolishing the state’s car tax, continue to prosper.

This suggests that George W. Bush needs to persuade voters that he is serious about whatever tax plan he puts forward. He also needs to be specific enough that most voters feel that they can realistically expect to see some meaningful tax savings quickly.

For myself, I am less interested in the details of Bush’s tax plan than I am about whom he will pick to sell it if elected.

As they say in Washington, “Personnel is policy.” That means if someone with an impeccable record as a tax cutter is appointed Treasury secretary--a Jack Kemp, Steve Forbes or Jim Gilmore--then I can be confident that tax cuts will be at the top of his agenda and that they will be pushed with vigor and tenacity.

For reasons I have never understood, presidential candidates never want to tell us much, if anything, about whom they will staff their administration with before the election. I think this is essential information that voters ought to have.

At least the top few Cabinet positions--State, Treasury, Defense and Justice--ought to be chosen and revealed to voters. At least as far as tax cuts are concerned, the choice of a tax-cutting Treasury secretary would lend great credibility to Bush on this issue--and also guard against the kind of backsliding that got his father into trouble.