Dole Cut: Details, Please
Would Bob Dole's tax plan work? Would it fundamentally change the growth pattern of the US economy as we move into the next century and our rendezvous with massive baby-boom Social Security and health-care costs? Or would it balloon deficits and debt instead of shrinking them?
To answer that epic question, Mr. Dole now needs to spell out more specifically how he would cut federal expenditures to pay for his three-stage 15 percent tax cut for all taxpayers, plus assorted tax credits and reductions.
He estimates that leaving some $548 billion in the hands of citizens rather than the IRS would stimulate economic growth enough to create some $148 billion in new tax revenues. That's possible, if still a subject of hot debate among economists. But it leaves $400 billion still to be achieved by cuts in federal spending.
The former Senate majority leader is a serious man on fiscal matters. He has spent years shaping his views on responsible budgeting, and many weeks recently debating with advisers before launching his new proposal. So his ideas deserve serious scrutiny.
We're pleased to have this issue become a focus of national debate. But, like the leaders of the Concord Coalition, we trust that the sweet allure of tax cuts will not turn the coming campaign into a bidding war in which budget-balancing and the need to reform entitlements get lost.
Polls indicate that more than two-thirds of Americans are skeptical about campaign pledges to cut taxes. No wonder. Look at what happened in the past two elections: Bill Clinton's pledge of a tax cut turned into a tax increase. George Bush's "no new taxes" left lip-readers paying more.
But some state governors, notably Christie Whitman in New Jersey and Bill Weld in Massachusetts, have fulfilled pledges to cut taxes by stages. So we have case studies for sober debate.
But let no one forget that such debate also has to deal with entitlement reform and saving the next generation from a crushing debt burden.