The frugal Republican administration just spent tens of millions of our tax dollars dollars to send people letters telling them to expect their $300 and $600 checks. You may have gotten one yourself.
‘This mailing was a complete waste of taxpayer money,’ said Republican Congressman Peter Hoekstra, of Michigan, miffed not least because 500,000 letters went out with the wrong information, leading to further expense in correcting them.
In any event, the checks have begun going out. The lower the last 2 digits of your Social Security number, the sooner yours will arrive. (Those ending in 00-09 arrive this week; 90-99 will arrive in late September.)
If you run balances on high-interest credit cards, that is unquestionably the place to apply your windfall: pay off those balances! Not having to pay 21% (or even 11%) on a credit card, is like earning 21% (or 11%) tax-free, risk-free. Get off the debt treadmill!
But if you don’t particularly need the money, you may want to join those who have decided to support some charitable or political cause they care about.
One possible recipient (not my own choice) is the RNC. If you are pleased with the vision of George W. Bush, Trent Lott, Tom DeLay, et al, endorse your check over to the Republican National Committee and mail it to:
Robert M. Duncan
Republican National Committee
310 First Street, SE
Washington DC 20003
1. Note that political contributions are NOT tax-deductible (and that only U.S. citizens and permanent residents may make them).
2. Endorse your check: “Pay to the order of the Republican National Committee” (and sign it).
3. Include a business card or a note with your OCCUPATION and EMPLOYER for the RNC’s report to the Federal Election Commission. (This can be “homemaker/self” or “retired/none” — whatever applies.)
Maybe include, also, a note to let the RNC know which of their policies you particularly applaud – ‘Drill the Arctic Wildlife Refuge!’ ‘Preserve the gun-show loophole!’ ‘Shut down the Korean peace process!’ ‘Scuttle the nuclear nonproliferation treaty!’ ‘Cut alternative-energy research!’ ‘Criminalize abortion!’ ‘Help Big Tobacco!’ ‘Abolish tax on America’s 4,000 wealthiest estates!’
(My personal favorite: ‘Global warming, global schwarming!’)
You could of course just stick to the traditional ‘Cut taxes!’ and ‘Smaller government!’ But that’s getting a little frayed around the edges. For one thing, the federal payroll got significantly bigger under Reagan/Bush, not smaller. It was under Clinton/Gore that the federal payroll shrank sharply – both military and non-military.
And it was under Reagan/Bush that taxes on the average American, when you include hikes in Social Security payments, went up, while only taxes on those at the top were slashed.
I happen to think it was right to slash my taxes. The top federal bracket had been a preposterous 90% under Eisenhower, a nearly as preposterous 70% from Kennedy all the way through Johnson, Nixon, Ford and Carter, a still-too-high 50% in Reagan’s first term and then 28% in his second.
Reagan deserves a lot of credit, I think, for slashing that 70% top bracket. It’s just that by going all the way down to 28% – much as we lucky few loved it – he overshot the mark. The result: Huge deficits and a quintupled National Debt.
I think we got the balance about right under Clinton/Gore, leaving income tax rates unchanged for 98% of taxpayers, lowering them to even further-below-zero for the working poor (via an expanded earned-income tax credit), but raising the top brackets to 36% and 39.6%.
Do I love paying 39.6% of my marginal income to Uncle Sam? I do not. But I did love the prosperity of the last 8 years, and the extraordinary feeling that we actually had begun, finally, to pay down the $5.5 trillion national debt.
It’s not that I’m fixated on paying off the debt. As I’ve written many times: we don’t need to. But paying it down in good times will give us that much more cushion and flexibility to weather, or even largely avoid, bad times.
So before you write, ‘more tax cuts!’ on your note to the RNC, remember that tax cuts have consequences. Already, deficits seem increasingly likely . . . which could lead the bond market to demand higher interest rates, your adjustable mortgage payment to rise, the dollar to weaken, imported products to become more expensive – just think back to the last Bush economy. The Bush tax cut, let alone all the time bombs it contains down the road, will pretty much put an end to significant debt reduction. It was nice while it lasted.
That said, I recognize many of you disagree with me. I really do invite those of you who are excited by the direction that Bush / Lott / Helms / Armey / DeLay are taking the country to send your refund checks to the RNC.
For those of you not so inspired, there is a whole different set of groups to whom you might endorse your check. (See, for example, the set of choices suggested at RejectTheRebate.com.) Your church, your child’s school, Indian earthquake relief – the list is practically endless.
Kathryn Lance: ‘A colleague has suggested that we all send our $300 tax refunds as donations to the Democratic Party. Great idea, or what?‘
Well, perhaps not surprisingly, I do think that is a great idea (and Kathryn was only one of several of you who have suggested it to me).
The DNC is probably the one place, above all others, that President Bush, Karl Rove, et al, would not like to see people send their checks.
If this appeals to you, you might want to print this out or address your envelope now to have handy when the great day arrives:
1. Remember that political contributions are NOT tax-deductible (and that only U.S. citizens and permanent residents may make them).
2. Endorse your check: “Pay to the order of the Democratic National Committee” (and sign it).
3. Include a business card or a note with your OCCUPATION and EMPLOYER for the DNC’s report to the Federal Election Commission. (This can be “homemaker/self” or “retired/none” — whatever applies.)
4. Maybe include, also, a note – ‘Reproductive rights!’ ‘The environment!’ ‘The national debt!’ ‘Stem cell research!’ – to let the DNC know what you care about.
(On the issue of stem-cell research – frustration over which, as you may have seen on the front page of the Wall Street Journal last week, drove one of our top scientists to emigrate to England where his efforts are ardently sought – may we assume that today’s opponents will, on principle, agree to forgo, and deny their children, the miracle therapies that will likely result?)
5. Include your e-mail address to help the DNC extend its effectiveness.
6. Mail to:
Democratic National Committee
430 So. Capitol St., SE
Washington, DC 20003
Think of it as poetic justice.
Unlike the RNC, the DNC actually needs the money.
Quote of the Day
Follow a tip from a company's president and you will lose half your money. Get a tip from the chairman and you'll lose all of it.~Bennett Goodspeed (The Tao Jones Averages) quoting a canny Scot.
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