February 4, 2000 12:59 PM | Permalink |
|Related CTJ Publications:|
The huge cost of the upper-income tax cut plan put forward by Texas Gov. George W. Bush would far exceed officially projected non-social-security budget surpluses over the next decade. A new analysis by Citizens for Tax Justice shows that as a result and despite Gov. Bush’s promise to protect Social Security, the Bush tax plan would raid as much as three-quarters of the ten-year projected Social Security surpluses.
Over the next decade, the Congressional Budget Office projects budget surpluses, excluding Social Security, of $838
|Effects of the Bush Tax Plan on Social Security, 2001-10|
|Surplus Projections (without Social Security):|
|A. CBO: adjust appropriations for inflation||$ +838 billion|
|B. Adjust for inflation & population||+399|
|C. Maintain share of the economy||–14|
|Cost of Bush Tax Plan||$ 1,779 billion|
|Projected Social Security Surplus||$ +2,314 billion|
|Percentage of Social Security Surpluses used up by Bush Tax Plan|
|Appropriations Scenario A||41%|
|Appropriations Scenario B||60%|
|Appropriations Scenario C||78%|
billion–assuming that discretionary appropriations will merely stay even with inflation. If one instead assumes that discretionary appropriations will keep up with population growth as well as inflation, these projected budget surpluses fall to only $399 billion. If, as is probably most likely, appropriations keep up with the economy, then the entire non-social-security surplus disappears.
Meanwhile, over their first nine years (fiscal 2002-10), the Bush tax cuts would cost $1.8 trillion (including $265 billion in added interest costs). As a result, over the next decade, the Bush tax cuts would far exceed all reasonable projections of upcoming non-social-security surpluses. That would require dipping deeply into the Social Security trust fund to pay for the Bush tax cuts. In fact, over the next decade, the Bush tax plan would use up between 41% and 78% of projected Social Security surpluses.
“Gov. Bush may somehow think he can have a giant tax cut for the well-off and protect Social Security at the same time, but the figures show he’s simply wrong,” said CTJ director Robert S. McIntyre.