Permanent tax cuts unsound policy

There is a great deal of discussion that significant changes in Social Security are needed now because of the 75-year shortfall in funding in the program. Yet, the cost of the tax cuts, if made permanent, is more than three times the size of the Social Security shortfall. This does not mean that policymakers should avoid Social Security reform. Nevertheless, this comparison helps to illustrate why the tax cuts are unaffordable, and why making them permanent does not represent sound policy. It also shows how distorted the claims are that the tax cuts were moderate and reasonable while the Social Security shortfall is massive. In fact, the Social Security shortfall is modest compared to the size of the tax cuts.

In 1990 and 1993, Presidents Bush and Clinton took a balanced approach toward deficit reduction that included revenue increases and spending cuts. Today's long-term fiscal problems are so big that they can't be solved simply by repealing the tax cuts. But is it sensible to address the deficit problem simply by eviscerating federal programs? A more balanced approach would be to reverse the tax cuts as much as possible (certainly not make them permanent), close unproductive corporate tax loopholes, make responsible reforms that will restore long-term solvency to Social Security and Medicare, and develop ways to slow the rapid rate of growth in health-care costs in the United States.

It's not a solution to keep running up bigger and bigger deficits. Ultimately, it will be necessary to take action to prevent deficits from getting so large on a sustained basis that they damage the economy. If we are willing to raise revenues, take a balanced approach to reducing spending and address the structural problems in our health-care system, we can address our fiscal problems while ensuring that public programs that serve crucial functions are preserved.

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Karen Crompton is executive director of Voices for Utah Children, a nonprofit child advocacy organization based in Salt Lake City.